Westport Asset Management

Westport Asset Management

Last Update: 2014-05-09

Number of Stocks: 59
Number of New Stocks: 1

Total Value: $1,057 Mil
Q/Q Turnover: 1%

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

Westport Asset Management Watch

  • Westport Asset Management Comments on Albemarle Corp.

    Albemarle Corp. (ALB) was sold when it became clear that the markets for a number of its products were unlikely to develop as planned.


    From Westport Funds First Quarter 2014 investor letter.

      


  • Westport Asset Management Comments on Core Laboratories

    And finally, Core Laboratories N.V. (CLB), a unique and highly regarded oil service company, was sold in January with a gain of 87% for the 15 month holding period. It was originally purchased when its share price experienced a sharp decrease after reporting disappointing earnings for the third quarter of 2012.

      


  • Westport Asset Management Comments on Brown & Brown

    Brown & Brown, Inc. (BRO), the insurance broker, was sold after it met its price objective and pricing for some insurance lines was viewed as unlikely to increase further, barring calamities that would consume large amounts of industry capital.

      


  • Westport Asset Management Comments on Bed Bath and Beyond

    Bed Bath and Beyond, Inc. (BBBY) was added to the portfolio during the quarter in response to a significant reduction in its stock price when it reported third quarter fiscal 2014 results and gave a disappointing outlook for the remainder of the fiscal year. Nonetheless, this premier provider of domestic merchandise and household furnishings remains a market leader and continues to improve its multi-channel sales (an expansion of internet marketing capabilities).

      


  • Westport Asset Management Comments on MasterCard Inc.

    The greatest disappointment in the quarter was from MasterCard, Inc. (MA) whose stock price declined 10.6% and negatively impacted performance in the quarter by 37 basis points. This negative performance is attributable to results for the fourth quarter of 2013 coming in below estimates. The company decided to invest additional money in support of new customers which reduced earnings. The outlook for MasterCard, Inc. and Visa Inc. is positive as the volume of business increases when countries move from paper based systems for commerce to electronic ones.

      


  • Westport Asset Management Comments on EOG Resources Inc.

    The exploration and production company EOG Resources, Inc. (EOG) was the primary driver for this sector's performance, contributing 63 basis points with a nearly 17% stock price gain for the quarter.

      


  • Westport Asset Management Comments on FEI Company

    The third large contributor was FEI Company (FEIC), a producer of electron microscopes, whose shares were up over 15% and added 104 basis points. The company continues to benefit from its unique market position and growing acceptance of new products.

      


  • Westport Asset Management Comments on DeVry Education Group Inc.

    DeVry Education Group Inc. (DV) was up over 19% and added 110 basis points. This for-profit education company reported December quarter earnings that exceeded analysts' estimates and indicated that new student enrollment at its largest operating unit could soon improve.

      


  • Westport Asset Management Comments on United Rentals Inc.

    In this environment, the Westport Select Cap Fund continued to perform well. Several issues stood out on the upside with three adding one percentage point or more to performance. United Rentals, Inc. (URI), the country's largest equipment rental company, gained over 21% in the quarter, adding 126 basis points***. The company continues to benefit from the gradual improvement in non-residential construction and the continuing trend to rent versus buy decisions on the part of major customers.

      


  • Westport Select Cap Fund First Quarter 2014 Commentary

    Portfolio Review During the first quarter the Westport Select Cap Fund (WPSRX)'s R shares rose 2.13%, ahead of the Russell 2000® Index's gain of 1.12%. Since inception 16 and a quarter years ago, the Westport Select Cap Fund R shares have outperformed by just under 3 percentage points a year, 10.52% to 7.65%, both compounded annually.


    Following last year's strong gains, it was not surprising to see the market struggle in the first three months of 2014. Compounding the usual concerns over the growth outlook, Federal Reserve policy, etc., Russia's annexation of Crimea added a geopolitical risk to the investment puzzle.

      


  • Westport Funds First Quarter 2014 Investor Letter

    Portfolio Review


    The U.S. economy strengthened in 2013, especially during the second half of the year. Current statistics suggest that economic growth continues in 2014 but at a rate diminished by the harsh winter weather in the first quarter. The return (gain plus dividends) from the Standard and Poors 500 Index in 2013 was 32.4% but earnings increased only 7% during the year. The remainder resulted from expansion in the valuation of those earnings through a higher P/E ratio****. The higher valuation of stocks and reduced clarity on earnings caused some investors to reassess expected returns for 2014 and to reduce equity exposure.

      


  • Westport Funds - Westport Select Cap Fund Fourth Quarter Commentary

    Portfolio Review During the fourth quarter the Westport Select Cap Fund's R shares rose 9.40%, ahead of the Russell 2000® Index's gain of 8.72%. For the year, the Select Cap Fund's R shares modestly trailed the Index with an increase of 37.22% compared to a return of 38.82% for the Russell 2000® Index. Since inception 16 years ago, the Select Cap Fund R shares have outperformed by just under 3 percentage points a year, 10.55% to 7.70%, both compounded annually. Obviously, 2013 was a remarkable year for small cap stocks. Only one other time in the past sixteen years has the Russell 2000® Index gained more than 30% and that was in 2003, but that year's gain followed a prior year loss of over 20%. By contrast, 2013's rise came after a more than 16% gain in 2012.


    In this environment the Westport Select Cap Fund performed well. None of the year-end portfolio holdings declined in value. In fact, the largest negative impact (0.51 basis points***) came from Forest Oil Corp., a position that was eliminated earlier in the year.

      


  • Westport Funds Comments on Universal Health Services

    In the case of Universal Health Services, Inc., the company i s likely to be one of the prime beneficiaries of expanding health care insurance coverage dictated by the Affordable Care Act * ** ( " Obama - care " ). Unique to Universal Health Services, Inc. (UHT) is its position in mental health services which account s for three - q uarters of its earnings before deductions for interest expense, taxes, depreciation and amortization .


     

      


  • Westport Asset Management Comments on Precision Castparts Corp.

    Precision Castparts Corp. (PCP) is a prime component supplier to the commercial aircraft manufacturers. Indicative of the attractiveness of this business was The Boeing Company ' s recent announcement that its year - end backlog was 5,080 planes compared to the 648 jets delivered in 2013. By the same token, Airbus ' (a subsidiary of Airbus Group NV) backlog at the end of November was 5,400 versus the 562 planes del ivered in the first eleven months of the year.


     

      


  • Westport Asset Management Comments on Radian Group Inc.

    One new position, Radian Group, Inc. (RDN), was established. One of the largest private mortgage insurance companies, Radian Group, Inc. should benefit from a recovery in the housing industry and from the Federal Housing Administration's gradual pull-back from the mortgage insurance market.

    From Westport Asset Management (Trades, Portfolio)'s fourth quarter 2013 commentary.  


  • Westport Funds Third Quarter Letter

    Dear Fellow Shareholder:

    The U.S. equity markets posted broad-based returns for the third quarter despite a high level of uncertainty created by both the Federal Reserve's failure to implement the much anticipated "tapering" of QE3 and concerns that Washington will be unable to quickly end the government shutdown and prevent a government default. The quarter ended with the Dow Jones Industrial Average*, the S&P 500® Index*, and the Nasdaq Composite Index* returning 2.12%, 5.24%, and 11.20% respectively. Market returns in the quarter were fueled by the continuing moderate U.S. economic expansion and the Federal Reserve's quantitative easing ("QE").  


  • Westport Asset Management Comments on Lender Processing Services Inc.

    The customers of Lender Processing Services, Inc. (LPS) are mortgage originators and servicers. The company supplies information technology "IT" to enable efficient mortgage processing and provides services that allow the customers to outsource many associated functions. Some of the services entangled the company in "robo signing" and the resulting lawsuits caused a sharp decline in its share price. In time most of the legal issues were resolved and its former parent Fidelity National Financial, Inc. decided the IT segment would enhance its product offerings, while substantial savings were available in merging its mortgage services with those of Lender Processing Services, Inc. Since the acquisition proposal is for cash and FidelityNational Financial, Inc. common stock, an analysis of Fidelity National Financial, Inc. was undertaken. The conclusion was that the new company is not attractive at this time. Consequently, holdings in Lender Processing Services, Inc. with a duration greater than one year were liquidated.

    From Westport Asset Management's second quarter 2013 letter.  


  • Westport Asset Management Comments on Precision Castparts

    Making the third largest contribution for the half was Precision Castparts Corp. (PCP), the components supplier to the aerospace industry. After being essentially flat in the first quarter, the stock rose over 19% in the second quarter, adding 177 basis points to performance. As we had anticipated, the shares rose as problems with Boeing's 787 were resolved.

    From Westport Asset Management's second quarter 2013 letter.  


  • Westport Asset Management Comments on Willis Group Holdings

    The second largest contributor to first half performance was Willis Group Holdings plc (WSH), the international insurance broker. The shares rose over 21% and added 204 basis points to performance. The company's business turnaround continues and could be accelerated by actions expected to be announced this quarter by the new CEO.

    From Westport Asset Management's second quarter 2013 letter.  


  • Westport Asset Management Comments on Universal Health Services Inc.

    By far the biggest contributor to first half performance was the Westport Select Cap Fund's largest holding, Universal Health Services, Inc. (UHS), Class B shares. This operator of acute care and mental health hospitals gained over 38% and contributed 393 basis points to performance. Once again investors focused on the company as a prime beneficiary of the 2014 implementation of the Affordable Care Act, known by most commentators as "Obamacare."

    From Westport Asset Management's second quarter 2013 letter.  


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