John Rogers

Last Update: 07-10-2015

Number of Stocks: 187
Number of New Stocks: 4

Total Value: $8,922 Mil
Q/Q Turnover: 9%

Countries: USA
Details: Top Buys | Top Sales | Top Holdings  Embed:

John Rogers Watch

  • John Rogers' Ariel Fund Second Quarter 2015 Commentary

    Investing in small- and mid- cap stocks is riskier and more volatile than investing in large-cap stocks. The intrinsic value of the stocks in which the Fund invests may never be recognized by the broader market. Ariel Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors, and its performance may suffer if these sectors underperform the overall stock market.


    Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains, and represents returns of the Investor Class shares. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the period ended June 30, 2015, the average annual total returns of Ariel Fund (Investor Class) for the 1-, 5- and 10 -year periods were +9.79%, +19.15% and +7.46%, respectively. Ariel Fund’s Investor Class shares had an annual expense ratio of 1.03% for the year ended September 30, 2014. Performance data current to the most recent month-end for Ariel Fund may be obtained by visiting our website, arielinvestments.com.

      


  • A Gas Company Expanding its Portfolio

    In a previous article, we determined that Praxair Inc. (NYSE:PX)´s intrinsic value was above the trading price by 11%, so according to our model and assumptions, the stock seems to be undervalued and subject to a potential “buy” recommendation.


    Manning & Napier Advisors, Inc has recently initiated a new position on Praxair with 30,886 shares, so in this article, let´s take a look at the company´s fundamentals.

      


  • The Market for Tobacco Alternatives Continues to Evolve

    In this article let's take a look at Philip Morris International Inc. (NYSE:PM), the global tobacco giant that sells cigarettes in over 200 countries, which manufactures and markets the number one cigarette brand: Marlboro.


    Next generation of ecigarettes

      


  • John Rogers' Undervalued Stocks Trading With Low P/E Ratio

    John Rogers (Trades, Portfolio) is the founder of Ariel Investment, LLC, which he started in 1983. He began as a small and mid-cap value manager, and evolved strategically to offer three approaches - all of which seek out attractive intrinsic value through relatively concentrated portfolios. The firm uses the market's short-term focus to uncover mispriced companies whose true value will be realized over time.


    His portfolio is composed of 187 stocks, four of which were bought during the last quarter. The total value of the portfolio is $8,922 million with 9% Q/Q turnover.

      


  • John Rogers Increases Holding in Tech Company Qumu

    John Rogers (Trades, Portfolio) of Ariel Investments upped his stake in Qumu Corp (NASDAQ:QUMU) by 56% on June 30, adding 630,204 shares at a price of $8.24 per share. His total holding in the company now amounts to 1,749,277 shares.


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  • John Rogers' Ariel Funds June Commentary

    Last month, we studied year-to-date returns, and this month, we will comment on year-to-date flows. We see returns and flows as two different tools for measuring investment sentiment and think using them in combination is superior to depending solely on one. Recall that in examining U.S. stock returns last month, we noted returns were positive across the board, with growth outperforming value. To us that suggests optimism and an embracing of risk for U.S. equity investors.


    We now turn to asset flows in mutual funds. Last year when we examined 56 categories in the taxable bond, U.S. equity and international equity groups, we saw a fairly clear picture. Investors were hunting for yield, especially in bonds, and seeking safety in equity categories. They were avoiding growth fare and aggressive international investments. All in, we saw broad caution in the first half of 2014. The picture is different and a bit more cloudy this year.

      


  • John Rogers' Investment in Anixter International Inc

    Anixter International Inc. (NYSE:AXE) is a distributor of enterprise cabling and security solutions, electrical and electronic wire and cable products, and OEM supplies. The company is chaired by Sam Zell, the billionaire best known for his real estate business Equity Residential.


    After Zell, the next largest shareholder is Ariel Investments, LLC - John Rogers (Trades, Portfolio) - who added heavily to his position last quarter, bringing his total shares to 2.23 million.

      


  • Top Micro-Cap Picks From the Gurus

    Much like small-cap stocks, micro caps (generally defined as capitalizations between $50-300 million) offer opportunities for very large growth, but also present significant risk and volatility.


    Over the last year, the Russell Microcap Index returned 11.19%, slightly underperforming the Russell 3000 return of 11.86%. When looking over a three-year period, the Microcap index returned 20.89% compared to Russell 3000’s 19.92%.

      


  • John Rogers' Ariel Funds Monthly Commentary - May 2015

    Month Ended May 31, 2015

      


  • Five-year lows: Acacia Research Corporation, Park Electrochemical Corp, Bill Barrett Corporation, Black Box Corp

    According to GuruFocus list of five-year lows, these Guru stocks have reached their five-year lows: Acacia Research Corporation, Park Electrochemical Corp, Bill Barrett Corporation, Black Box Corp


    Acacia Research Corporation reached $9.62

      


  • Ariel Investments' Top Undervalued Stocks

    Ariel Investment, founded by John Rogers (Trades, Portfolio) in 1983, is a firm that looks closely at a company's intrinsic value and its margin of safety (of at least 40%). The prices are given ample time to reflet intrinsic vlaue.


    The firm currently owns 187 positions in its portfolio, valued around $8.9 billion and has a 9% quarter over quarter turnover rate.

      


  • John Rogers' Recent Buy: Versar Inc

    John Rogers (Trades, Portfolio) is the Founder of Ariel Investment, LLC, which he started in 1983. As of Q1 2015 the portfolio has a value of $8,922 million and is composed of 187 stocks.


    On April he increased by 47.61% his stake in Versar Inc (VSR) a project and program management firm that provides the government, municipalities, and the private sector with solutions for infrastructure, facilities management, construction, environmental quality, professional services, defense and homeland security needs.

      


  • John Rogers' Investment Propels Two Stakes into His Personal Top 10

    John Rogers (Trades, Portfolio), founder of Ariel Investment, LLC, is known to like to invest in small and medium-sized companies whose share prices are undervalued, believing that patience, independent thinking and a long-term outlook are critical to achieving good returns. Ariel had a 44.68% return in 2013 and a 20.32% return in 2012.


    In the first quarter, Rogers made additions to two stakes – Kennametal Inc (NYSE:KMT) and Blount International Inc (NYSE:BLT) – that were sufficient to land them in his Top 10 by volume.

      


  • 5-year lows: American Public Education Inc, Quiksilver Inc, RealNetworks Inc, Universal Technical Institute Inc.

    According to GuruFocus list of 5-year lows, these Guru stocks have reached their 5-year lows: American Public Education Inc, Quiksilver Inc, RealNetworks Inc, Universal Technical Institute Inc.


    American Public Education Inc reached $23.26

      


  • Risk & Reward with Gilead Sciences Inc. (GILD)

    I realize that biotech stocks are not really value investments, per se. They constantly need R&D to keep up with competitors and the competitive advantages from drug patents have a limited, albeit long, time frame. However, with Gilead (NASDAQ:GILD) there could be some reward owning at this level.


    The Company’s areas of focus include human immunodeficiency virus (HIV), liver diseases such as chronic hepatitis B virus (HBV) infection and chronic hepatitis C virus (HCV) infection, oncology or inflammation and serious cardiovascular and respiratory conditions.

      


  • John Rogers' Ariel Fund Monthly Commentary for April

    In the March monthly commentary, we discussed how our investment activity drove Ariel Fund’s strong bull market performance, examining focus, concentration and the trading of portfolio holdings. In our traditional value quarterly letter from the same period, we examined K. J. Martijn Cremers’s Patient Capital Outperformance: The Investment Skill of High Active Share Managers Who Trade Infrequently, to explore the benefits of being highly active managers with long holding periods. This month, we will bring the two topics together and dive deeper to study portfolio turnover.

      


  • 5-year lows: Bridgepoint Education, Pendrell Corp, Gulf Island Fabrication, and Commercial Vehicle Group Inc.

    According to GuruFocus list of 5-year lows, these Guru stocks have reached their 5-year lows: Bridgepoint Education Inc, Pendrell Corp, Gulf Island Fabrication Inc, and Commercial Vehicle Group Inc.


    Bridgepoint Education Inc (NYSE:BPI) Reached $8.78

      


  • Growing And Undervalued: Aflac Inc.

    From my watch list, let’s have a short view ofAflac Inc (AFL). It looks undervalued based on the Peter Lynch value, discounted cash flow and is trading below the Peter Lynch earnings line


    Aflac Inc (AFL)

      


  • Guru Investors Are Piling Into National Oilwell Varco

    Plenty of top name super investors continue to buy into this stock, and rightfully so.


    National Oilwell Varco (NYSE:NOV) is a beast!

      


  • John Rogers' Ariel Fund Q1 2015 Commentary

    Investing in small- and mid-cap stocks is riskier and more volatile than investing in large-cap stocks. The intrinsic value of the stocks in which the Fund invests may never be recognized by the broader market. Ariel Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors, and its performance may suffer if these sectors underperform the overall stock market.


    Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains, and represents returns of the Investor Class shares. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the period ended March 31, 2015, the average annual total returns of Ariel Fund (Investor Class) for the 1-, 5- and 10-year periods were +19.54%, +16.12% and +7.89%, respectively. Ariel Fund’s Investor Class shares had an annual expense ratio of 1.03% for the year ended September 30, 2014. Performance data current to the most recent month-end for Ariel Fund may be obtained by visiting our website, arielinvestments.com.

      


  • John Rogers' Ariel Fund Monthly Commentary on March

    We will not beat around the bush: We are very proud of our flagship Ariel Fund’s performance record. Within its Morningstar1 MidBlend Category, the Fund ranks in the top decile over the trailing 1-, 3-, 5-, and 15-year periods as of March 31, 2015. True, no fund has a spotless record: Ariel Fund ranks in the 70th percentile over the 10-year period. That decade-long period contains the 2006-2008 period when the Fund struggled. But just as there are periods where a fund is out of favor, there are periods where everything clicks. In the six years between the March 9, 2009 bottom and March 9, 2015, Ariel Fund ranks number one in the 259 funds in this same category. Moreover, its performance over that stretch has been balanced. Among funds that existed in March 2009 as well as March 2015, Ariel Fund ranked number one among 259 category peers in the three years from March 9, 2009 to March 9, 2012, and it ranked number four among 322 in its category in the three years from March 9, 2012 to March 9, 2015.


    True to our fiercely competitive form, we are not resting on our laurels but are investigating the period in order to keep the streak alive. We want to deeply examine our activities in the periods from 2009 to 2012, and 2012 to 2015 to determine what lessons we could draw that we can apply going forward.

      


  • John Rogers Expands Stake in MTS Systems

    Guru John Rogers (Trades, Portfolio) did something in February that he has done in nearly every quarter for the last two years – he bought stock in MTS Systems Corp (NASDAQ:MTSC), a provider of test systems and industrial position sensors based in suburban Minneapolis.


    MTSC announced three weeks ago that it had reached an agreement with McLaren Applied Technologies (NASDAQ:MAT) to manufacture a next-generation vehicle dynamics simulator (VDS).

      


  • Analyzing John Rogers' Top Holding: Gannett Co.

    John Rogers (Trades, Portfolio) is the Founder of Ariel Investment, LLC, which he started in 1983. As of 2008, the firm had over $15.5 billion in assets under management. John manages Ariel's small and mid-cap institutional portfolios, as well as the Ariel Fund (ARGFX) and the Ariel Appreciation Fund (CAAPX). He is also a long-term Forbes columnist writing a column called "Patient Investor."


    Rogers has concentrated his investment selection on small and medium-sized companies whose share prices are undervalued. He believes that patience, independent thinking, and a long-term outlook are essential to achieving good returns. His fund seeks to purchase companies whose prospects include high barriers to entry, sustainable competitive advantages, and predictable fundamentals that allow for double digit cash earnings growth. Rogers purchases companies when they are trading at a low valuation relative to potential earnings (p/e less than 13x forward cash earnings) and/or a low valuation relative to intrinsic worth (40% discount to private market value - PMV).

      


  • Weekly Guru Bargains Highlights: NOV, PBR.A, EC, VALE, SSL

    According to GuruFocus updates, these stocks have declined the most since Gurus have bought.


    National Oilwell Varco Inc (NYSE:NOV): Down 28% since David Dreman (Trades, Portfolio) bought in the quarter ended on 2014-12-31

      


  • John Rogers' Top Growth Stocks

    John Rogers (Trades, Portfolio) is the Founder of Ariel Investment, LLC, which he started in 1983. As of 2008, the firm had over $15.5 billion in assets under management. Rogers manages Ariel's small and mid-cap institutional portfolios as well as the Ariel Fund (ARGFX) and Ariel Appreciation Fund (CAAPX). He is also a long-term Forbes columnist writing a column called "Patient Investor."


    Web Page: http://www.arielmutualfunds.com/

      


  • Weekly 3-Year Low Highlights: IBM, ABEV, ITUB, OXY

    According to GuruFocus list of 3-year lows, International Business Machines Corp, Ambev SA, Itau Unibanco Holding SA and Occidental Petroleum Corp have all reached their 3-year lows.


    International Business Machines Corp (NYSE:IBM) Reached $157.08

      


  • Mario Gabelli´s Last Bet

    Mario Gabelli (Trades, Portfolio) is the founder, chairman, and CEO of Gabelli Asset Management Company Investors (GAMCO Investors) a $30 billion dollar global investment firm headquartered in Rye, New York.


    The investor reported increasing his stake in Superior Industries International (NYSE:SUP) on March 11, according to GuruFocus Real Time Picks. With the transaction, Gabelli’s position increased by 1.06% to 2,132,001 shares. The fund initiated a position more than five years ago, and during 2014 Gabelli added and reduced the stake to reach 2.1 million shares at the end of the fourth quarter of 2014, worth $41.98 million.

      


  • John Rogers' Ariel Fund February Monthly Commentary

    A year ago, we analyzed performance since the market bottom in March 2009. We often repeat topics but did not anticipate a sequel to that commentary. And yet we are indeed providing an update because the story remains compelling and thought provoking.


    We will summarize last year’s perspective briefly. In the first two months of 2009, pessimism was ubiquitous and powerful. While almost everyone was talking about the preceding decade as “lost” for stocks, we were saying extraordinarily cheap stocks were likely paving the way for a great decade to come. Last year represented the 5-year anniversary of the market bottom marking the end of the financial crisis—an obvious halfway point. For that reason, we weighed in on the market’s progress; the news was very good. Interestingly, it has only gotten better since then.

      


  • January Commentary from Ariel Fund's John Rogers

    In January 2013, we devoted our monthly commentary to asset flows and have since found it a good way to kick off the year. Interestingly, before the 2007-2009 financial crisis, it was a rather dry task to track the amounts investors put into and pulled out of various mutual funds. In the wake of that epic bear market, however, investor behavior shifted dramatically and made the topic more intriguing. The flows from 2012 showed a big preference for bonds over stocks, a huge swing from actively managed equity portfolios to passive ones and a much greater fondness for funds with stellar short-term performance. The 2013 flows looked better, with inflows to taxable bond, international stock and U.S. stock funds (including active U.S. stock funds) and less performance chasing.


    The 2014 flow data show a return to the behavior that concerned us from 2008 to 2012. All four big, traditional asset classes – U.S. equity, international equity, taxable bond, and municipal bond – had inflows in 2014. That said, of the $201 billion flowing into the four groups, $107 billion went to international equity, taxable bond funds attracted $51 billion, $29 billion flowed to municipal bond funds, and U.S. equity received a mere $13 billion. One of the smart, key themes of this century has been a push toward more global portfolios, so many investors have been playing catch up with their international allocations. While the huge inflows to international stock funds therefore make some sense, we are puzzled by muni bonds drawing twice as much money as U.S. stocks.

      


  • Guru Stocks at 52-Week Lows: XOM, AXP, DISCA, RL, SNI

    According to GuruFocus list of 52-week lows, these Guru stocks have reached their 52-week lows.


    Exxon Mobil Corporation (NYSE:XOM) reached the 52-week low of $89.19

      


  • Weekly CEO Buys Highlight: BH, WMS, MBFI, PKY, HOS

    According to GuruFocus Insider Data, these are the largest CEO buys during the past week. The overall trend of CEOs is illustrated in the chart below:


    Biglari Holdings Inc (NYSE:BH): Chairman and CEO, 10% owner Sardar Biglari bought 2,506 shares

      


  • John Rogers Increases His Position in MN

    John Rogers (Trades, Portfolio) of Ariel Investment, LLC recently increased his position in Manning & Napier Inc (NYSE:MN). There are currently 186 stocks in his portfolio, valued at $7.750 billion with a quarter over quarter turnover rate of 8%.


    John Rogers (Trades, Portfolio) showed an interest in the stock market when he was only 12 years old, when his father would buy him stocks as Christmas and birthday presents. As an alumnus of Princeton University where he studied economics, he received the Woodrow Wilson Award in 2008, which is the most prestigious award, given to those who embody a career in national service.

      


  • Still Bullish On Dun & Bradstreet

    In this article, let's take a look at Dun & Bradstreet Corp. (NYSE:DNB), a $4.21 billion market cap company, which is a worldwide provider of business information and related decision support services and commercial receivables management services.


    Little Growth

      


  • John Rogers Ariel Funds Q4 2014 Commentary

    Investing in small- and mid-cap stocks is riskier and more volatile than investing in large-cap stocks. The intrinsic value of the stocks in which the portfolio invests may never be recognized by the broader market. Ariel Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors, and its performance may suffer if these sectors underperform the overall stock market.


    Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains, and represents returns of the Investor Class shares. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the period ended December 31, 2014, the average annual total returns of Ariel Fund (Investor Class) for the 1-, 5- and 10-year periods were +10.95%, +16.62% and +7.16%, respectively. Ariel Fund’s Investor Class shares had an annual expense ratio of 1.03% for the year ended September 30, 2014. Ariel Fund’s Investor Class shares had an annual expense ratio of 1.03% for the year ended September 30, 2013. Performance data current to the most recent month-end for Ariel Fund may be obtained by visiting our website, arielinvestments.com.

      


  • Weekly Guru Bargains Highlights: NFLX, CS, CAT, HAL, SLB

    According to GuruFocus updates, these stocks have declined the most since Gurus have bought.



    Netflix Inc (NASDAQ:NFLX): Down 26% Since George Soros (Trades, Portfolio) Bought In the Quarter Ended on 2014-09-30

      


  • Respected Value Investor John Rogers Of The Ariel Fund Shares His Top Three Picks For 2015

    Where does John Rogers (Trades, Portfolio) see value in 2015.


    He believes industrial companies are well set for 2015 thanks to lower energy costs.

      


  • John Rogers' Ariel Fund December Commentary

    Investments in foreign securities may underperform and may be more volatile than comparable U.S. stocks because of the risks involving foreign economies and markets, foreign political systems, foreign regulatory standards and foreign currencies and taxes. The use of currency derivatives and exchange-traded funds (ETFs) may increase investment losses and expenses and create more volatility. Investments in emerging and developing markets present additional risks, such as difficulties in selling on a timely basis and at an acceptable price. The intrinsic value of the stocks in which the portfolio invests may never be recognized by the broader market.


    Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains and represents returns of the Investor Class shares. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. Performance data current to the most recent month-end for the Funds may be obtained by visiting our website, arielinvestments.com.

      


  • Various Hedge Fund Managers Bet on American Express

    In this article, let's take a look at American Express Company (NYSE:AXP), a $94.23 billion market cap company that is a leading global payments and travel & expense services company.


    Spending patterns

      


  • John Rogers' October Commentary

    Recently, we have been concentrating on fundamentals—by rereading one of our favorite books, A Random Walk Down Wall Street, by Princeton professor Burton G. Malkiel. We highly recommend the 10th edition, which was revised in 2012. It remains a timeless, thoughtful meditation on efficient markets.


    This great tome has become reduced and simplified to one notion in the popular imagination: Buy index funds. While it certainly helped launch passive investing, Random Walk contains a great deal more than one simple lesson. Ironically, the crucial insight embedded in its title all too often gets lost—the stock market follows a random walk. Dr. Malkiel writes: A random walk is one in which future steps or direction cannot be predicted on the basis of past history.

      


  • Johnson & Johnson Fairly Valued – I Will Bet on It

    In this article, let´s consider Johnson & Johnson (NYSE:JNJ), a $297.71 billion market cap that is the world's largest and most diverse healthcare company. It has a trailing P/E ratio that indicates that the stock is relatively undervalued (PE 19.4x vs Industry Median 42.0x).


    Key drivers

      


  • Some Drivers of the World's Largest Automaker

    In this article, let's take a look at Toyota Motor Corporation (NYSE:TM), a $182.43 billion market cap company that is one of the world's largest automobile producers.


    Quality and more

      


  • John Rogers Ariel Appreciation Fund Q3 Commentary

    Investing in mid-cap stocks is riskier and more volatile than investing in large-cap stocks. The intrinsic value of the stocks in which the portfolio invests may never be recognized by the broader market. Ariel Appreciation Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors and its performance may suffer if these sectors underperform the overall stock market.


    Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains and represents returns of the Investor Class shares. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the period ended September 30, 2014, the average annual total returns of Ariel Appreciation Fund (Investor Class) for the 1-, 5- and 10-year periods were +12.22%, +16.54% and +8.80%, respectively. The Fund’s Investor Class shares had an annual expense ratio of 1.13% for the year ended September 30, 2013. Performance data current to the most recent month-end for Ariel Appreciation Fund may be obtained by visiting our website, arielinvestments.com.

      


  • John Rogers' Ariel Fund Q3 2014 Commentary

    Investing in small- and mid-cap stocks is riskier and more volatile than investing in large-cap stocks. The intrinsic value of the stocks in which the portfolio invests may never be recognized by the broader market. Ariel Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors, and its performance may suffer if these sectors underperform the overall stock market.


    Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains and represents returns of the Investor Class shares. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the period ended September 30, 2014, the average annual total returns of Ariel Fund (Investor Class) for the 1-, 5- and 10-year periods were +15.52%, +16.46% and +7.18%, respectively. Ariel Fund’s Investor Class shares had an annual expense ratio of 1.03% for the year ended September 30, 2013. Performance data current to the most recent month-end for Ariel Fund may be obtained by visiting our website, arielinvestments.com.

      


  • Southern Company a Fairly Valued Stock

    In this article, let´s consider Southern Company (NYSE:SO), a $42.29 billion market cap, which has a trailing P/E ratio that indicates that the stock is relatively undervalued (PE 18.9x vs Industry Median 20.1x). The obvious question I’m sure you want to know is – what is the future stock price movement? Although I cannot predict exactly the moment, we can see some drivers of this Atlanta-based energy holding company, which is one of the largest producers of electricity in the U.S., and then try to analyze its intrinsic value and compare it with the actual trading price.


    Principal drivers

      


  • State Street: A Good Business Model

    In this article, let's take a look at State Street Corporation (NYSE:STT), a $29.10 billion market cap bank holding company with more than $27 trillion of assets under custody and $2 trillion of assets under management. It operates in 26 countries and more than 100 geographic markets worldwide.


    Global reach

      


  • 5-year lows: Aeropostale Inc, ASA Gold And Precious Metals Ltd, Nuverra Environmental Solutions Inc, and Multi-Fineline Electronix Inc

    According to GuruFocus' list of 5-year lows, these Guru stocks have reached their 5-year lows: Aeropostale Inc, ASA Gold And Precious Metals Ltd, Nuverra Environmental Solutions Inc, and Multi-Fineline Electronix Inc


    Aeropostale Inc (NYSE:ARO) Reached $2.89

      


  • John Rogers' Ariel Investments Monthly Commentary - September

    We continue to field questions concerning the “active versus passive” investing debate. For our part, we largely agree with Morningstar’s Michael Breen, who wrote in his “Give Peace a Chance in the Active vs. Passive Debate” article: [T]here’s value to both active and index approaches. A number of actively managed funds have beaten the broad market, but index funds tracking the market still delivered solid returns over time in a cheap, low-maintenance package that’s a perfect fit for many investors. Meanwhile, those willing to roll up their sleeves and do a little fundamental research appear to have a good chance of picking winning active funds.1


    More on that last point later, but first we want to address where our philosophy comes from and why this heated debate has become even more pertinent lately.

      


  • Guru-Held Stocks Trading At Historical Low P/B

    Buying stocks based on historical low price-to-book (P/B) ratios has been shown to be an effective investment strategy. At GuruFocus, our “Top 25 Historical Low P/B Ratio Companies” portfolio has outperformed the S&P 500 by 16.13 percent since its inception in 2010. Our portfolio is rebalanced once a year and can be viewed at GuruFocus.com. Below is the latest list of stocks that are trading near historical low P/B ratios and are widely held by the investing gurus we follow:


    Kellogg Co (K) is trading at its 10-year low P/B ratio of 5.81. The company is engaged in the manufacture and marketing of ready-to-eat cereal and convenience foods. Its brands include Kellogg’s, Keebler, Cheez-It, Murray, Austin and Famous Amos. The 10-year median P/B ratio is 8.4. The stock is undervalued since its book value per share has been accelerating to higher 5- and 1- year annual growth rates of 11.8 and 47.8 percent, compared to its 10-year annual growth rate of 4.10. The stock would be priced at $88.10 if trading at its 10-year median P/B ratio. The stock is held by 16 gurus we follow with Hotchkis & Wiley holding the largest position of 2.38 million shares, representing 0.66 percent of the shares outstanding.

      


  • Accenture is a Leading IT Services Provider

    In this article, let's take a look at Accenture plc (ANC), a $52.36 billion market cap company, which is a global management consulting, technology services and outsourcing company.


    A well-positioned company

      


  • Ariel Funds' John Rogers August Commentary

    We have noted before that standardized return periods, especially shorter-term ones, can unfortunately drive investors to make poor decisions. To illustrate the point, below we discuss the trailing three-year returns of the equity markets. These three-year numbers have been rising for several months, and we think they are likely to rise next month—fairly substantially, in fact. This observation is not in any way a prediction; it is based on the known past rather than on the unknowable future.


    Nobody knows what will happen in September 2014, but we do know what happened in September 2011. That is, a short bear market that many seem to have forgotten came to a close. Specifically, from May 1, 2011, through September 30, 2011, the S&P 500 Index fell –16.26%, the MSCI EAFE Index dropped –22.19%, and the Russell 2000 Index lost –25.10%. Many use a drop of –20% as the measurement of a bear market and largely pay attention to the large-cap market, so some view the event as a simple correction. On the other hand, Russell and other experts use a –15% drop to define bear markets; that is our standard at Ariel. Given small caps’ –25% decline alongside sharp drops globally, from our perspective it clearly merits the label of bear market. Whether or not you call the five-month drop in 2011 a bear market, it certainly greatly affects the current three-year return numbers. Obviously, as new monthly returns become a part of the three-year record, older months “roll off.” For this reason, standardized period returns can jump or plummet around inflection points that happened years ago. Below we show the last three-year returns from the past five months to illustrate the point.

      


  • I Feel Bullish on Costco Due to its Business Model

    In this article, let's take a look at Costco Wholesale Corporation (NASDAQ:COST), a $55.22 billion market cap company, which operates about 650 membership warehouses in the U.S., and other countries such as Puerto Rico, Canada, the U.K., Taiwan, Japan, Korea, Mexico and Australia.


    Costs reduction

      


  • Many Hedge Fund Managers Invest in Bed Bath

    In this article, let's take a look at Bed Bath & Beyond Inc. (NASDAQ:BBBY), a $13.10 billion market cap company, which isone of the best retailer of the industry.


    Long-term goal

      


  • Weekly CEO Buys Highlight: OPK, BOBE, CONN, WPX, PHII

    According to GuruFocus Insider Data, these are the largest CEO buys during the past week. The overall trend of CEOs is illustrated in the chart below:


    Opko Health Inc (NYSE:OPK): CEO & Chairman, 10% Owner Phillip Md Et Al Frost bought 103,000 shares

      


  • Accenture: What Amazing ROE During Ten Years

    In this article, let´s see one of the most important financial ratios applying to stockholders, the best measure of performance for a firm's management: the Return on Equity (ROE), and we are going to analyze it in the case of Accenture PLC (NYSE:ACN).


    ROE is calculated as net income applicable to common shares divided by the average book value of common equity: ROE = Net Income / Av. Book Value

      


  • The Top Five Guru-Held Mid-Cap Stocks of Q2

    Using the GuruFocus Aggregated Portfolio Screener you can filter results to see what companies maintain the highest amount of guru ownership. By using this screener, we filtered down to see mid-cap companies which are held by the most gurus. The following five mid-capped companies are held by the largest number of gurus during the past quarter.


    Quest Diagnostics (DGX)

      


  • Weekly 3-Year Low Highlights: GES, QLGC, NPK, PHMD, FHCO

    According to GuruFocus list of 3-year lows, Guess? Inc, QLogic Corp, National Presto Industries, PhotoMedex Inc, and Female Health Co have all reached their 3-year lows.


    Guess? Inc (NYSE:GES) Reached $23.44

      


  • Weekly 3-Year Low Highlights: CHL, TM, STO, NTT

    According to GuruFocus list of 3-year lows; China Mobile Ltd, Toyota Motor Corp, Statoil ASA, and Nippon Telegraph & Telephone Corp, have all reached their 3-year lows.


    China Mobile Ltd (NYSE:CHL) Reached $60.94

      


  • Guru Stocks at 52-Week Lows: CHL, TM, SNY, NVO, TSM

    According to GuruFocus list of 52-week lows, these Guru stocks have reached their 52-week lows.


    China Mobile Ltd (NYSE:CHL) Reached the 52-Week Low of $60.94

      


  • 5-year lows: Aeropostale Inc, Multi-Fineline Electronix Inc, Layne Christensen Co, and Forest Oil Corp.

    According to GuruFocus list of 5-year lows, these Guru stocks have reached their 5-year lows: Aeropostale Inc, Multi-Fineline Electronix Inc, Layne Christensen Co, and Forest Oil Corp.


    Aeropostale Inc (NYSE:ARO) Reached $3.17

      


  • John Rogers' Ariel Fund July Commentary

    Our May commentary addressed U.S. stock market performance from January to May. As you may recall, returns had been up and down, large and mid caps had trounced small caps, and value had beaten growth. While the returns of Ariel Fund and Ariel Appreciation Fund were quite similar, the disparity between benchmarks made Ariel Fund look solid and Ariel Appreciation Fund appear lethargic. This commentary will focus more attention on assessing performance generally and on the Russell Midcap Value Index in particular.


    Dissecting investment results can be tricky. First and foremost—and this is no secret—strong absolute returns sometimes mask poor relative returns, while low absolute returns can actually be solid in a given market environment. That is, a +10% gain is not astounding in the context of a market that is up more than +32%, as the market was in 2013. By contrast, a –10% loss would have been stellar for an equity portfolio in 2008, when the S&P 500 plummeted –37%.

      


  • Widely Held Guru Stocks Near Historical Low P/B Ratios

    Buying stocks at historically low price-to-book (P/B) ratios has been an effective strategy. The model portfolio, “Top 25 Historical Low P/B Ratio Companies”, has outperformed the S&P 500 by 29.51 percent since its inception in 2010. The following stocks are widely held by the investing gurus we follow and are trading near their historical low P/B ratios:


    Kellogg Company (K) is trading at a low P/B ratio of 6.10, near its 10-year low of 5.88. Its principle products are ready-to-eat cereals and convenience foods, such as cookies, crackers, savory snacks, toaster pastries, cereal bars, fruit-flavored snacks, frozen waffles and veggie foods. The 5- and 10-year median P/B ratios are 8.4 and 8.5. At the 5-year median, the stock would be priced at $87.60. Book value per share has been growing at an annual rate of 11.90 percent over the past five years. The stock is held by 18 gurus we follow with Hotchkis & Wiley having the largest holding of 2.43 million shares, representing 0.68 percent of the shares outstanding.

      


  • Goldman Sachs: A Strongest Investment Bank

    In this article, let's take a look at The Goldman Sachs Group, Inc. (NYSE:GS), a $77.3 billion market cap company, which is one of the world's leading investment banking and securities companies.


    Well-Positioned

      


  • This Tobacco Stock Looks Attractive Enough

    In this article let's take a look at an option for investing in the tobacco sector with British American Tobacco plc (BTI), which sells tobacco products in 180 countries. The company holds leadership positions in around 50 of them. Brands like Dunhill, Kent, Pall Mall, and Lucky Strike account for one third of group sales because they are well known and have been gaining share over the past several years.


    Competitive Advantages

      


  • John Rogers' Ariel Fund Q2 2014 Shareholder Letter

    Investing in small- and mid-cap stocks is riskier and more volatile than investing in large-cap stocks. The intrinsic value of the stocks in which the portfolio invests may never be recognized by the broader market. Investing in equity stocks is risky and subject to the volatility of the markets. Ariel Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors and its performance may suffer if these sectors underperform the overall stock market.


    Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains and represents returns of the Investor Class shares. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the period ended June 30, 2014, the average annual total returns of Ariel Fund (Investor Class) for the 1-, 5- and 10-year periods were +29.50%, +24.25% and +7.54%, respectively. Ariel Fund’s Investor Class shares had an annual expense ratio of 1.03% for the year ended September 30, 2013. Performance data current to the most recent month-end for Ariel Fund may be obtained by visiting our website, arielinvestments.com.Investing in small- and mid-cap stocks is riskier and more volatile than investing in large-cap stocks. The intrinsic value of the stocks in which the portfolio invests may never be recognized by the broader market. Investing in equity stocks is risky and subject to the volatility of the markets. Ariel Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors and its performance may suffer if these sectors underperform the overall stock market.

      


  • Guru Held Stocks Near Historical Low P/B

    Buying stocks at historically low price-to-book (P/B) ratios has been an effective strategy. The model portfolio, “Top 25 Historical Low P/B Ratio Companies”, has outperformed the S&P 500 by 25.44 percent since its inception in 2010. The following stocks are the most widely held stocks by the investing gurus we follow that are trading near their historical low P/B ratios:


    Kellogg Co (K) is trading at a low P/B ratio of 6.80, near its 10-year low of 5.92. The company is well-known for its cereal and offers other convenience foods. Some of the other brands it markets are Keebler, Cheez-It, Murray, Austin and Famous Amos. The stock is held by 17 gurus we follow with Hotchkis & Wiley holding the largest position of 2.43 million shares, representing 0.68 percent of the shares outstanding.

      


  • John Rogers Comments on Contango Oil & Gas Co

    Also, natural resources explorer Contango Oil & Gas Co. (MCF) slipped –11.37% after an earnings report that disappointed the Street. Specifically, the company’s first-quarter loss of $10 million was driven by $42 million in dry-hole (a well that produces no commercially viable oil and gas) costs from a Gulf of Mexico well. Investors focused heavily on that unfortunate news—which we see as an unlucky part of the business— rather than on the company’s otherwise solid numbers. We were quite encouraged that the company plans to shift its capital expenditures entirely onshore where dry-hole risks are much lower.

    From John Rogers (Trades, Portfolio)' Ariel Fund Second Quarter 2014 Commentary.  


  • John Rogers Comments on Charles River Laboratories Intl Inc

    Preclinical testing firm Charles River Laboratories Intl, Inc. (CRL) dropped –11.30% as mergers and acquisitions ramped up in the health-care sector. Health-care consolidations have been rising, the most prominent being a proposed $100 billion acquisition of Astra-Zeneca by Pfizer Inc. (PFE), and with mergers come the rationalization of research capabilities. The market tends to react swiftly and sharply to such events. We think such reactions are generally overblown, as the effects tend to be more short-term than long-term; as such we think Charles River has become a better bargain lately.

    From John Rogers (Trades, Portfolio)' Ariel Fund Second Quarter 2014 Commentary.  


  • John Rogers Comments on CBRE Group Inc

    In addition, global real estate company CBRE Group, Inc. (CBG) jumped +16.81% after a very strong quarterly earnings report. Its adjusted earnings per share were $0.25, $0.08 higher than expectations, on the basis of strong revenue overall and nearly across its units. The market seemed especially pleased that management saw more upside than downside for the rest of 2014.

    From John Rogers (Trades, Portfolio)' Ariel Fund Second Quarter 2014 Commentary.  


  • John Rogers Comments on US Silica Holdings Inc

    Industrial sand producer U.S. Silica Holdings, Inc. (SLCA) piled up a +45.60% return after a great earnings report. Recent results were solid, but the key takeaway from management’s comments was the comparison of the current environment to that of 2011 and 2012, when business boomed based on heavy demand. All along, we have viewed Silica as a cyclical business, so we expected it to improve along the way; by the same token, we do not think a great environment will persist forever.

    From John Rogers (Trades, Portfolio)' Ariel Fund Second Quarter 2014 Commentary.  


  • John Rogers' Ariel Fund Second Quarter 2014 Commentary

    Quarter Ended June 30, 2014


    After a slow start to the year, global equities accelerated in the second quarter of 2014. For the quarter, domestic large caps edged out mid caps and foreign equities—with small caps posting a solid but less dramatic quarterly gain. The pattern from the first quarter continued: a preference for yield-bearing investments and equities with a reputation for steadiness and fundamental strength. For instance, across Russell’s main smaller-cap value indexes (2000, 2500 and Midcap), the two top-performing sectors were utilities and energy. Along the same lines, in smaller- cap stocks value topped core, while growth underperformed. The pattern was not as pronounced abroad, where emerging markets stocks outpaced developed markets—with sagging China being a key exception. We had strong returns this quarter, as Ariel Fund gained +6.42%, beating the Russell 2500 Value Index’s +4.20% advance, as well as the +2.38% rise of the Russell 2000 Value Index.

      


  • John Rogers' Ariel Investments 2nd Quarter 2014 Commentary

    We will come right out and say it: this has been a strange year for the markets so far. In 2014, through mid-April, the S&P 500 Index took a bumpy trip to nowhere—or technically a +0.02% gain. Since then, however, it has returned +7.54%. According to the Wall Street Journal, the S&P 500 has also had 16 record closes in the second quarter of 2014, and its volatility has dropped to the lowest level since 2007. At this point in a bull market, you might expect record highs and low volatility to drive unencumbered exuberance, but not this time. On the one hand, the Investors Intelligence Advisors Sentiment Charts show 61% are bullish on the market and 16% are bearish, with the rest expecting a correction. On the other hand, market pundits continue to detect fear, skepticism and worse in market movements. One global strategist recently told Bloomberg Businessweek: “Classically, the market climbs a wall of worry. Now we’re having a wall of hatred.”


    A look at asset flows suggests what investors are doing, and what it might mean. When we examined 56 Morningstar mutual fund categories and find the biggest inflows in dollar and percentage terms in the first five months of 2014, some fairly clear patterns emerge.

      


  • John Rogers and RS Investments Top Guru Real Time Trades of the Week

    The following information is a highlight of the real-time guru activity we saw this week. To view more information on these gurus, check out their guru portfolios. The “Real Time Picks” reports the stock purchases and sells that Gurus have made within the prior two weeks. If a Guru makes a purchase or sell of a company in which they own a greater-than 5% stake, SEC regulations require them to report their transaction within two days. This week we saw notable increases and buys in Real Time activity from John Rogers (Trades, Portfolio) and RS Investment Management (Trades, Portfolio).

    John Rogers (Trades, Portfolio)  


  • Ariel Investments' John Rogers Discusses KKR, First American, Dun & Bradstreet



  • John Rogers' Ariel Investment Fund April Commentary

    At Ariel Investments, three qualities connect our various strategies: patience, focus and independent thinking. Our portfolios now stretch from micro-cap to large cap and range from deep value to traditional value to global, but the philosophy behind them inspires similar activity during market dislocations. That is, when stocks fall, whether across markets or within one of our portfolios, our portfolio managers and analysts get extra busy. As vigilant assessors of value, we gather information and crunch numbers to determine whether the price shifts reflect fundamental, long-term changes in what businesses are worth. If we determine gaps between price and value have widened, hence creating better investment opportunities, we will buy more shares of the companies that have been, in our view, unfairly punished.


    In the first four months of 2014 some areas of the market have gained in quite normal amounts. Large caps are up +2.56% at home and +2.31% in developed markets abroad, as measured by the S&P 500 and MSCI EAFE indexes, respectively. Smaller-cap U.S. stocks, however, have had a mixed year, with some small- and mid-cap indexes up and some down; the bellwether small-cap Russell 2000 Index has fallen –2.80%. Moreover, our portfolios in the micro-cap to mid-cap range have had negative returns in the first four months of the year. We think that has created opportunities for our managers, so this month, we wanted to describe the most significant stock purchases in our smaller-cap deep value and traditional value portfolios firm-wide.

      


  • John Rogers Comments on Laboratory Corp. of America Holdings

    We purchased a previous holding in our mid ca p fund, Laboratory Corp. of America Holdings (LH). LabCorp maintains a leading market position in an indust ry that continues to show promising growth potential du e to technological advances, aging demographics, health care cost containment, and preventative medicine. LabCorp maintains a solid balance sheet, generates a significant amount of free cash flow and has been returning value to shareholders through share repurchases. The company operates with an experienced management team that is conservative yet willing to take slight risks in order to grow the business long-term.

      


  • John Rogers Comments on International Game Technology

    Also, gaming manufacturer International Game Technology (IGT) returned –22.00% after a subpar earnings report. Its revenue and earnings per share both slid below consensus estimates. Specifically, revenues were 2% lower than Wall Street expected, while the (adjusted) EPS of $0.25 did not meet the $0.30 forecast. The miss came from weak regional gaming trends and higher-than-expected operating expenses. We think operating issues can be corrected and believe management is focused on the issue. In the meantime, we see light business as temporary and industry-wide— beyond IGT's control. We would be more concerned if the short-term results stemming fr om lost market share, for instance. Although there have been headwinds for this company, we remain optimistic over the long term.

      


  • John Rogers Comments on Coach Inc.

    A few of our holdings struggled at quarter end. Specialty retailing Coach, Inc. (COH) de clined –10.91% after missing expectations. The company reported EPS of $1.06 after making $1.23 per share last year. Consensus had been $1.11. The main culprit was lower traffic in retail stores. It has been a very difficult winter for many retailers, but for Coach the more important issue is its st yle turnaround. Stuart Vevers, the new creative director, has his first complete line appearing this spring and hitting stores next fall. As long- term investors, a six-month waiting period is not difficult, but obviously, Wall Street is less patient than we are. We believe the company will emerge with its brand largely intact, new products to captivate customers and better financial results to follow.

      


  • John Rogers Comments on Thermo Fisher Scientific Inc.

    In addition, scientific research specialist Thermo Fisher Scientific Inc. (TMO) returned +8.12% after a very solid earnings report. Its revenue was $3.5 billion, up 6% over the previous period, and its earnings per share was $1.43, significantly above the $1.37 cons ensus estimate. Its forecast for 2014 was even more positive : full-year revenue guidance was in the $16 billion-plus ra nge, smashing the $13 billion consensus estimate, and the low end of its EPS guidance was more than $0.40 higher than Wall Street's best guess. Our strategy with Thermo Fisher has been to look beyond the gloom and doom that has cast a dark cloud over the whole sector to see the potential for a bright future.

      


  • John Rogers Comments on JLL Inc.

    Several of our holdings posted strong returns this quarter. Real estate specialist JLL Inc. (JLL), previously known as Jones Lang LaSalle Inc., surged +15.73% due to a strong earnings report. Specifically, in late January the company reported better-than-expecte d (adjusted) earnings per share (EPS) of $3.33; the Street expected $3.09. Revenues topped forecasts, $1.5 billion rather than $1.3 billion. In addition, the company's operating results were boosted by solid investment sales, facility management services and momentum in leasing revenues. Moreover, management signaled continued improvemen ts across its businesses. The market is still applying a cautiously cyclical set of expectations to this firm, but we believe its gradual growth is more secular in nature.

      


  • Cheap Stocks from John Rogers of Ariel Investments



  • John Rogers' Ariel Appreciation Fund First Quarter 2014 Commentary

    Investing in mid-cap stocks is more risky and more volatile than investing in large cap stocks. The intrinsic value of the stocks in which the portfolio invests may never be recognized by the broader market. Investing in equity stocks is risky and subject to the volatility of the markets. Ariel Appreciation Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors and its performance may suffer if these sectors underperform the overall stock market.


    Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains and represents returns of the Investor Class shares. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the period ended March 31, 2014, the average annual total returns of Ariel Appreciation Fund (Investor Class) for the one-, five- and ten-year periods were +25.33%, +28.77% and +8.55%, respectively. The Fund's Investor Class shares had an annual expense ratio of 1.13% for the year ended September 30, 2013. Performance data current to the most recent month-end for Ariel Appreciation Fund may be obtained by visiting our web site, arielinvestments.com.

      


  • Ariel Fund First Quarter 2014 Commentary

    Investing in small and mid-cap stocks is more risky and more volatile than investing in large cap stocks. The intrinsic value of the stocks in which the portfolio invests may never be recognized by the broader market. Investing in equity stocks is risky and subject to the volatility of the markets. Ariel Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors and its performance may suffer if these sectors underperform the overall stock market.


    Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains and represents returns of the Investor Class shares. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the period ended March 31, 2014, the average annual total returns of Ariel Fund (Investor Class) for the one-, five- and ten-year periods were +23.74%, +30.25% and +7.37%, respectively. Ariel Fund's Investor Class shares had an annual expense ratio of 1.03% for the year ended September 30, 2013. Performance data current to the most recent month-end for Ariel Fund may be obtained by visiting our web site, arielinvestments.com.

      


  • John Rogers' Ariel Funds March Commentary

    Plenty of people talk about "endpoint sensitivity," but oftentimes they miss half the story. That is, in a data series there are really two endpoints—the last one and the first one. As standardized one-year, three-year, and five-year periods roll along, people focus great attention on the most recent month and tend to forget about the month that "goes away." Making this mistake in 2014 could prove harmful when examining five-year returns.


    Below are some recent returns for Ariel Fund. One reason we have selected our flagship mutual fund for this illustration is because its relative performance recently has been quite stable. Over the five years ended February 28th, 2014, it was the top-performing fund in Morningstar's Mid-Cap Blend category. It remained on top for the five-year period as of March 31* . At first glance, however, its absolute returns look like they changed a lot in one month:

      


  • Goldman Sachs Is a Sell According to DDM Model

    The Goldman Sachs Group Inc. (NYSE:GS) is one of the world's leading investment banking and securities companies. Its P/E ratio indicates that the stock is relatively undervalued (10.3 versus the 20.5 industry mean). So now let's take a look at the intrinsic value of this company and try to explain to investors the reasons it is a good buy or not.


    In this article, we present a model that is by no means the be-all and end-all for valuation. The purpose is to force investors to evaluate different assumptions about growth and future prospects.

      


  • Different Opinions on Bio-Rad Laboratories

    Bio-Rad Laboratories Inc. (NYSE:BIO) is a manufacturer and distributor of its own life science research and clinical diagnostics products. The company has two primary segments: Life Science and Clinical Diagnostics. The company sells its products and services to a diverse client base comprised of scientific research, healthcare, education and government customers.


    Let's take a look at this company and try to explain to investors the reasons this is an apparently appealing investment.

      


  • John Rogers' Ariel Investments February Commentary

    In the investing world, the worst of times can be the best of times to buy. The markets provided that lesson once again to investors over the last five years. A half-decade ago, with panic at generational highs and expectations near all-time lows, the market bottomed on March 9, 2009. As a result, the five-year results you see ending February 28, 2014 are likely the best month-end returns you will see for a long time. Before we get to those numbers, however, we would like to look back at our view exactly five years ago in the February 2009 commentary.


    Recall that neither we nor anyone could "call the bottom" back then. Indeed, looking straight into the rearview mirror, the financial press was doing close to the opposite, "reporting extensively about the so-called 'lost decade.'" The prevailing notion was that the negative 10-year return for the stock market shattered the status of stocks as a good long-term investment. We noted, however, that "[s]ince the beginning of 1929, the stock market has had negative 10-year returns at month-end only 9% of the time, and only 5% of the time after the Great Depression's damage." Moreover, these "lost" decades tended to be closer to market bottoms than signposts on the way to further losses: We noted that buying "at the end of a difficult 10-year stretch, even if the economy is in poor shape, tends to yield good results rather than bad ones." We used the strong decade-long periods immediately succeeding the negative 10-year returns from December 1974 and August 1982 to make the point. We ended with our core conclusion: "History tells us, however, this is the time to shove fear in the closet, think rationally, and ponder the next 10 years rather than the ten that just ended."

      


  • Ariel Investments' John Rogers Recommends Stocks

    Value investor John Rogers (Trades, Portfolio) recommends JM Smucker (NYSE:SJM), Bally Tech (NYSE:BYI) and Lazard (NYSE:LAZ).
      


  • John Rogers' Ariel Fund Comments on Roche

    Roche (XSWX:RO)'s story is different, and even more provocative. Its revenue growth has been quite steady, shifting only slightly from 9% in the 1991 to 2005 period down to 8% in the 2005 to 2012 period. Its earnings and P/E multiple, however, have been more jumpy throughout the multi-decade period, largely because Roche has had negative earnings years such as 1997 and 2002. Still, there is a very clear drop in sentiment in the recent period not reflected in fundamental results. That is, in 2005 Roche earned $1.37 per share, rising to $3.02 per share last year—a growth rate of +11.9% annually— without any negative earnings years. The recent steady growth is far better, we think, than the volatile rise of 3 +9.8% per year from 1991 to 2005. And yet the market chopped Roche's P/E ratio in half, from 27.3x in 2005 to 13.6x in 2011 (before it recovered a bit recently).


    What we see, then, is two companies with very long, strong track records before one even considers any details about the businesses—and both stocks are much cheaper than they have been historically. That prompted us to investigate, and when we dove deeply we got even more interested...

      


  • Ariel International Fund & Ariel Global Fund - Healthy Ideas

    Dear Fellow Shareholder: As you know, stocks continued a massive global rally this quarter. So we are happy to report a quarter of strong absolute performance and solid relative results. During the quarter, Ariel International Fund gained +11.03%, versus the MSCI EAFE Index, which returned +11.61%. Additionally, Ariel Global Fund rose +8.49%, topping the MSCI ACWI Index, which advanced +8.02%.


    For the one-year period ending September 30, 2013, Ariel International Fund returned +28.11% versus +24.29% for the MSCI EAFE Index. Over the same period, Ariel Global Fund advanced +28.84% compared to the MSCI ACWI Index, which gained +18.37%. For both funds, the top contributing sector was information technology, while the top detracting sector was telecommunication services. For Ariel International Fund, on a stock specific basis, top contributors were Nokia Corp. and Roche Holding AG, gaining +158.31% and +49.23%, respectively. Detractors included NTT DoComo, Inc. and Nintendo Co., Ltd., sliding -2.20% and -9.83%, respectively. Top contributors for Ariel Global Fund were Nokia Corp. and Gilead Sciences, Inc. returning +155.49% and +89.48%, respectively. Detractors included NTT DoComo, Inc., returning -5.47%, and Mobistar SA, falling -19.63%, respectively. Turning to philosophy and process, as we have mentioned before, we are true bottom-up stock pickers, but oftentimes market pressures bearing down on an area cause us to dive into that part of the market to find bargains. In our second-quarter 2013 letter, we explored how this tactic drove a significant weighting in Japanese stocks that worked very well and quite quickly. Mind you, we did not "bet" on Japan, but rather used the market's pessimism toward its overall economy in order to initiate positions in thriving multinationals that happened to be headquartered in Japan.

      


  • John Rogers Comments on Brooks Automation Inc.

    Brooks Automation, Inc. (BRKS) — Based outside of Boston, Brooks produces semiconductor manufacturing equipment, and has recently expanded into the life sciences area. The company has a leadership position in tool automation for semiconductor makers. The company has a pristine balance sheet with excess cash, solid leadership under CEO Steve Schwartz, and currently trades for roughly its book value.

      


  • John Rogers Comments on Superior Industries Intl Inc.

    Superior Industries Intl Inc. (SUP) — Los Angeles-based Superior is the leading wheel supplier to the North American auto industry. The company is solidly profitable, pays a dividend yielding over 4%, and has attractive long-term growth prospects if it is able to effectively increase its capacity. Yet the stock trades below book value, with no debt and significant excess cash.

      


  • John Rogers Comments on RealNetworks Inc.

    RealNetworks, Inc. (RNWK) — Based in Seattle, RealNetworks is best known for its RealPlayer media player software. The company has struggled in recent years, but we were attracted by the return of founder Rob Glaser to a company trading barely above its net cash and below our estimate of liquidation value. Since our initial purchase, the company has introduced RealPlayer Cloud, which along with other new products makes us confident that Mr. Glaser is likely to lead a successful turnaround.

      


  • John Rogers Comments on Vical

    Vical (VICL)


    We typically use these letters to discuss our approach to deep value investing, to outline the case for our favorite stocks, or to comment on trends in the market which we believe will affect our portfolio holdings. This quarter, however, we will share the story of a stock we have held for more than a decade which, at first glance, appears to have "blown up." We want to explain why we have owned it, how our valuation work continues to indicate a bargain within our long-term discipline, and how we will evaluate the company going forward. Most importantly, we want to demonstrate why we think the company is on solid footing and continues to provide a great long-term investment opportunity. On Monday, August 12 th , after announcing that the Phase III trial of its Allovectin compound, a metastatic melanoma therapy, had failed, Vical stock dropped by 57%. Specifically, it did not meet either the primary endpoint of objective response rate or the secondary goal of overall survival. This result obviously disappointed the company, shareholders, and, most of all, cancer patients. Many had hoped this immunotherapy compound would revolutionize treatment for those battling this terrible disease. Although we would have preferred a better outcome on Allovectin, our thesis for Vical was not a simple bet on its success. In our analysis, the company's infectious disease platform – with multiple promising products – was worth well more than the $240 million enterprise value of Vical just prior to the announcement. We continue to believe that is the case. All along, we knew a Phase III failure for Allovectin would lead to a s h or t- term hit to the stock, but we believed in the long-term, Vical was an undervalued infectious disease company. To us, Allovectin represented a free option on a cancer treatment with enormous upside potential. This option proved to be of no value, but our view on the rest of the company has not changed.

      


  • John Rogers' Ariel Discovery Fund - The DNA of Vical

    Dear Fellow Shareholder: This was a disappointing quarter for Ariel Discovery Fund, as our return of +2.47% lagged the +7.59% return of the Russell 2000 Value Index and the +5.24% gain of the S&P 500 Index. Year-to-date, Ariel Discovery Fund has returned +19.67%, as compared to +23.07% for the Russell 2000 Value and +19.79% for the S&P 500 Index. We continue to trail the benchmark since inception due to a tough launch, but even with this tough quarter our two-year annual return of +27.18% is respectable compared to the Russell 2000 Value Index and the S&P 500 Index.


    Top performers during the quarter were Furmanite Corp. (FRM), which gained +47.98%; Emergent BioSolutions Inc. (EBS), up +32.11%; and Gulf Island Fabrication, Inc. (GIFI), which returned +28.51%. On the downside were Vical Inc. (NASDAQ:VICL), losing -60.38%; JAKKS Pacific, Inc. ( JAKK), down -40.71% before it was sold, and Pendrell Corp. (PCO), which fell by -25.67% (although it remains up +52.67% year-to- date). Vical is discussed in detail below.

      


  • Ariel Investments' John Rogers Comments on Janus Capital Group Inc.

    Asset manager Janus Capital Group Inc. (JNS) soared +46.37% on better-than-expected earnings and revenue. Specifically, in October the company reported quarterly earnings of $0.18 per share versus consensus of $0.17. Its assets under management (AUM) rose to $166.7 billion, from $158.2 billion a year ago. The company’s cash investments totaled $793 million versus $543 million in debt, giving it a positive $250 million net cash position. Finally, Janus repurchased more than one million shares of its own stock. Clearly, the roaring 2013 stock market had a good deal to do with the positive news that caught Wall Street’s attention. For our part, we were more interested in the capital allocation decisions because those are under management’s control.

    From John Rogers (Trades, Portfolio)' Ariel Investments fourth quarter 2013 commentary.  


  • Ariel Investments' John Rogers Comments on Lazard Ltd.

    In addition, restructuring specialist and asset manager Lazard Ltd (LAZ) surged +27.36%, topping estimates for earnings and revenue by a significant margin. Its earnings per share for the third quarter were $0.46 versus the estimate of $0.37. The company’s operating revenue was $489 million, well above the $452 million expectation. Its September 30 AUM reached $176 billion, an all-time high to that date. We closely watch that figure, because we think it is an overlooked part of the business. Meanwhile, the global leading restructuring business had $42 million in revenue, 23% higher than a year ago. Still, restructurings continue to be well below the usual rate, leading us to believe the future is even brighter..

    From John Rogers (Trades, Portfolio)' Ariel Investments fourth quarter 2013 commentary.  


  • Ariel Investments' John Rogers Comments on Western Union Co.

    Also, transaction specialist Western Union Co. (WU) returned –6.85% due to disappointing guidance. Its quarterly earnings report was solid, with earnings and revenues both above consensus. At the same time, however, the company signaled that costs for regulatory and compliance investments would be higher than expected. As a result, management expects operating profit to be flat next year, and share buybacks will be minimal. Management had been returning capital to shareowners at a steady clip: Through the first three quarters of 2013, the company returned nearly $550 million to shareholders through dividends and buybacks. Admittedly Western Union has had a difficult couple of years, but we think its economic moati is firmly in place, even though most analysts seem to be looking right past it.

    From John Rogers (Trades, Portfolio)' Ariel Investments fourth quarter 2013 commentary.  


  • Ariel Investments' John Rogers Comments on International Game Technology

    A few of our holdings struggled in the third quarter. Gaming equipment specialist International Game Technology (IGT) slipped –3.46% due to a disappointing earnings report. Although revenues exceeded expectations by a solid margin, EPS of $0.30 fell short of the consensus $0.34 figure. The environment was more competitive than expected, leading to fewer of IGT’s games on the floor, as well as a corresponding decline in overall play. Still, the company is allocating capital smartly. It announced a $200 million share repurchase plan, which would retire roughly 4% of the shares outstanding. We continue to think that although gaming has been softer than expected in the ongoing recovery, eventually it will pick up.


    From John Rogers (Trades, Portfolio)' Ariel Investments fourth quarter 2013 commentary.

      


  • John Rogers' Ariel Investments Q4 2013 Commentary

    Investing in small and mid-cap stocks is more risky and more volatile than investing in large cap stocks. Ariel Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors and its performance may suffer if these sectors underperform the overall stock market. Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains and represents returns of the Investor Class shares. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the period ended December 31, 2013, the average annual total returns of Ariel Fund (Investor Class) for the one-, five- and ten-year periods were +44.68%, +26.01% and +8.18%, respectively. Ariel Fund’s Investor Class shares had an annual expense ratio of 1.03% for the year ended September 30, 2013 and 1.06% for the year ended September 30, 2012. Performance data current to the most recent month-end for Ariel Fund may be obtained by visiting our web site, arielinvestments.com.


    Both domestic and international stocks had strong returns in 2013, including the final quarter of the year. Somewhat predictably, the investment areas that were the most popular over the last half decade— bonds and emerging market stocks—had their comeuppance with negative returns for the year. And although investors were generally skeptical of developed market equities, here and overseas, most broad indices were up between +20% and +35%— well above the low double-digit historical averages. As independent thinkers, we entered the year bullish, viewing the global recovery from the financial crisis as ongoing and believing the pessimism overdone. We had good returns this quarter as Ariel Fund gained +12.99%, beating the Russell 2500 Value Index’s +8.83% jump, as well as the +9.30% rise of the Russell 2000 Value Index.

      


  • Ariel Investments' John Rogers Comments on January

    The big investment buzz a year ago was the so-called "Great Rotation," an expected shift out of bonds and into equities. In response, we devoted our January 2013 commentary to mutual fund flows, and while we were unsure whether the phenomenon would become a trend, we were clear that we saw the possibility as "a return to familiar ground." That is, from 2008-2012, investors changed their traditional patterns of behavior, evidently in reaction to the sharp equity losses in the 2007-2009 bear market. Last year, we wrote:


    In order of magnitude, the three shifts we have seen lately have been a massive preference for bonds over stocks, a huge swing from actively managed equity portfolios to passive ones and a much greater fondness for funds with stellar short-term performance.

      


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