Meridian Funds

Meridian Funds

Last Update: 2013-08-31

Number of Stocks: 149
Number of New Stocks: 15

Total Value: $2,681 Mil
Q/Q Turnover: 13%

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

Meridian Funds Watch

  • Top Insider Buys Highlight: Core Laboratories NV

    Executive VP & CFO of Core Laboratories NV (CLB) Richard Bergmark bought 7,000 shares on July 28 at an average price of $147.31. The total transaction amount was $1,031,170.


    Core Laboratories is a Netherlands limited liability company established in 1936, engaged in providing proprietary and patented reservoir description, production enhancement and reservoir management services to the oil and gas industry. Core Laboratories has a market cap of $6.67 billion; its shares were traded at around $150.25 with a P/E ratio of 27.80 and P/S ratio of 6.30. The dividend yield of Core Laboratories stocks is 1.10%. Core Laboratories Nv had an annual average earnings growth of 22.50% over the past 10 years. GuruFocus rated Core Laboratories the business predictability rank of 3-star.

      


  • Meridian Funds Comments on Exact Sciences Corp

    Exact Sciences Corp. (EXAS) also had negative returns during the period, which created a drag on overall Fund performance. Exact Sciences is an early stage diagnostic company with a test for early detection of colorectal cancers. Upon receipt of the U.S. Food and Drug Administration’s approval, we believe that Exact Sciences’s Cologuard test will help revolutionize colorectal screening and increase overall compliance rates with clinical guidelines. We think that the large market, combined with attractive unit economics, should drive an improvement in shareholder value.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Exa Corp

    Exa Corp. (EXA) provides software for simulation driven product design. The stock experienced erosion in its price during the period, which made it the second largest detractor to performance. We view the company as being an open-ended growth opportunity as software based simulation benefits from prototyping in transportation markets. Simulation reduces the need for expensive prototypes, increases automation, and allows for faster turnaround times, which ultimately result in customer savings. Exa signs annual consumption-based licenses with customers, which we believe create predictable revenue streams with low volatility.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on SciQuest Inc

    SciQuest, Inc. (SQI) also was the Fund’s largest detractor, experiencing a stock price decline over the period. We believe that this negative performance was due to shareholders taking profits at the end of the year after the stock returned nearly 80% for the 12-month period ending December 31, 2013. SciQuest is a software company that helps its customers connect with their suppliers and lower procurement costs. The company uses an on-demand model, which results in a high percentage of recurring revenues. We believe that this is a $4 billion potential market, which provides a long runway for growth considering SciQuest currently has less than $100 million in annual revenues.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Rignet Inc

    Rignet, Inc. (RNET) also contributed to the positive performance of the Fund during the period. RigNet is the largest provider of communications infrastructure to remote locations for the oil and gas industry. We believe the company has a strong competitive advantage as a result of its scale, quality of service, and customer relationships. RigNet is positioned to benefit from an increase in oil and gas production in more remote locations, especially deepwater projects.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Titan Machinery Inc

    Titan Machinery, Inc. (TITN) was a top contributor to the Fund, with its stock price generating robust returns for the two-week period ending December 31, 2013. Titan Machinery is the largest agricultural dealer for Case New Holland with solid market positions in the western U.S. From a growth perspective, we believe that the company is well-positioned to benefit from increased global food demand, a rebound in commercial construction activity, and further acquisition opportunities. We also consider the company’s business model to be solid, with a majority of profits coming from its more stable parts and service aftermarket business. We believe these characteristics can drive further improvements in shareholder value.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on National Research Corp

    National Research Corp. (NRCIB) experienced strong gains during the two-week period ending December 31, 2013. The company provides performance measurement services to the healthcare industry to help providers and payers measure outcomes. We believe that National Research is well positioned for the evolving healthcare landscape and has a strong business model characterized by recurring revenues, high margins, and returns on equity in excess of 20%. Additionally, the A shares owned by the Fund closed the year at a 45.8% discount to the B shares; we expect this valuation discrepancy to narrow over time.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Cisco Systems Inc

    Cisco Systems, Inc. (CSCO) also generated losses for the Fund during the period as earnings expectations were recently cut due to weakness in emerging markets. We are regarding our investment in Cisco with caution, but for now we continue to hold the shares due to the attractive dividend yield and the potential for dividend growth, even with muted earnings growth, enabled by the company’s low payout ratio and strong balance sheet.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Campus Crest Communities Inc

    Campus Crest Communities, Inc. (CCG) is a real estate investment trust (“REIT”) specializing in student housing in second tier university markets. Our investment suffered as we underestimated the supply growth outlook for this sector and the resulting pressure on results and investor sentiment. We sold the stock at a loss during the period.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Apple Inc

    Apple, Inc. (AAPL) also generated solid returns for the Fund during the period. Due to negative investor sentiment as earnings growth slowed, we were able to invest in the company at an attractive yield. We believe Apple’s cash-rich balance sheet and low payout ratio indicates an ability to grow dividends even if earnings growth does not return to its historic rate.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Lockheed Martin Corp

    Lockheed Martin Corp. (LMT) was the second largest contributor to Fund returns during the period. The company fared well as earnings grew better than expected despite budget related pressures on the defense industry. We believe that Lockheed Martin will experience continued earnings growth, and its low payout ratio indicates a strong possibility of future dividend increases.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Tempur Sealy International Inc

    Tempur Sealy International, Inc. (TPX) is a leading mattress manufacturer. Earnings declined as the industry slowed in 2013, as compared to a very strong 2012, as competitors successfully imitated Tempur Sealy’s “memory foam” products and as the company experienced problems with a new product launch. We initially invested because we believed that the company’s acquisition of Sealy in March 2013 could drive earnings growth in a stagnant mattress market, which could be helped by using cash flow generation to pay down debt and lower interest expense. We sold the stock at a loss due to a surprise sales shortfall that led us to believe that the declines in the company’s core “memory foam” products could be worse than we anticipated and presented a longer-term challenge.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Compass Minerals International Inc

    Compass Minerals International, Inc. (CMP) is a leading producer of rock salt and specialty potash fertilizer. This has traditionally been a high-quality company benefiting from a unique collection of resource assets. We invested in this company as we believed that earnings were due to turn after four years of weak road salt demand driven by mild Northeast winters and production problems at its potash mines. During 2013 the potash industry was rocked by the potential collapse of a European cartel, which led to falling potash prices. Facing significant uncertainty for the future of the potash market, we sold the stock during the period.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Aeropostale Inc

    Aeropostale (ARO) is a retailer focused on the teenage demographic. The company suffered declining earnings in 2012 as struggling competitors cut prices and customer preference moved away from Aeropostale’s traditional strength in core basics towards higher fashion content. We believed that the Aeropostale’s brand was still relevant and that the company would benefit as improving inventory positions at competitors eased price competition and as the addition of a new head of design improved the company’s fashion offerings. This did not materialize, however, and the company continued to struggle. We exited the position at a loss to invest in other companies with greater growth potential.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Polaris Industries Inc

    Polaris Industries, Inc. (PII) is a leading manufacturer of recreational vehicles such as ATVs, snowmobiles, and motorcycles. We invested in this company several years ago during a cyclical disruption to their business. We were attracted to their opportunity to gain share with several new manufacturing initiatives as well as new growth markets. The company has executed almost flawlessly and the stock has been a strong contributor to the portfolio.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Ubiquiti Networks Inc

    Ubiquiti Networks, Inc. (UBNT) designs and manufactures wireless broadband infrastructure equipment and other communications products. Ubiquiti Networks, Inc. suffered declining earnings in late 2012 as its rate of growth created operational challenges that resulted in a short-term disruption to sales, which we believed was fixable. With better controls in place in 2013, revenue and earnings growth resumed and the stock price more than doubled from our original purchase price. We continue to like their opportunity to grow market share in a very large and growing market.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Broadridge Financial Solutions

    Broadridge Financial Solutions, Inc. (BR) is a leading provider of investor communication and securities processing services. The stock price had been fairly stagnant for a number of years due to temporary softness in its core market and ongoing investments in future growth initiatives that lowered current profitability. In 2013 these headwinds waned, leading to renewed earnings growth, multiple expansion, and strong stock performance.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Dresser-Rand Group Inc

    Dresser-Rand Group, Inc. (DRC) also declined slightly during the period, causing a drag on overall performance. Dresser–Rand reported weak third quarter results due to the more volatile “new unit” segment and negative free cash flow due to higher working capital investments. We continue to like the investment given the consistent performance from its aftermarket segment and believe that the company has opportunities driven by new products and continued oil service investment.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Noodles & Co

    Noodles & Co. (NDLS) also detracted from Fund performance during the period. Noodles & Co. continues to execute on its growth plan but same-store sales growth came in slightly below expectations due to lower traffic and the impact of the Colorado floods. Noodles & Co. currently has 370 restaurants and we believe that the company has an opportunity to dramatically increase the store base at good unit economics.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


  • Meridian Funds Comments on Polypore International Inc

    Polypore International, Inc. (PPO) was the Fund’s largest detractor during the period. The company reported a weak third quarter with revenues and EPS missing consensus estimates. Additionally, the company announced that it was in the process of renegotiating contracts with its largest customers and that the outcome of these negotiations was difficult to predict. We continue to own the stock because we believe that Polypore has proprietary technology that allows it to manufacture the highest quality battery separators at the lowest cost. As electric and hybrid vehicles continue to increase their penetration of the auto market, we believe that Polypore should be poised to grow at high incremental margins and at high returns on invested capital.


    From Meridian Funds's semi-annual report ended December 31, 2013.

      


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