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Hawkins’ Southeastern Asset Management Decreases in LINTA and VMC
Posted by: Dianne Tordillo (IP Logged)
Date: December 17, 2012 05:25PM
Earlier this month, mutual fund company Southeastern Asset Management, where investing Guru Mason Hawkins serves as CEO and chairman, has reported three transactions. Apart from declaring itself the largest shareholder of Saks Inc., it also sold some of its shares in two stocks: Liberty Interactive Corp. (LINTA) and Vulcan Materials Company (VMX).
Southeastern Asset Management, which is the adviser to Longleaf Partners Funds, decreased in Vulcan by 18.47 percent on Dec. 5, and then reduced in Liberty Interactive by 43.41 percent five days later, according to GuruFocus Real Time Picks.
Both stocks are trading near their highs; Liberty is trading close to its five-year high at $19.25 and Vulcan is trading near its one-year high at around $52. Additionally, both stocks were listed as Southeastern’s 13th and 14th largest holdings in the third quarter, according to Mason Hawkins’ GuruFocus Portfolio details. Liberty represented 3.3 percent of the fund’s portfolio while Vulcan represented 2.6 percent of the fund’s portfolio.
Southeastern has continuously reduced its shares of digital company, Liberty Interactive Corp., since the fourth quarter of 2010. Its stock price had been on the rise since 2009. The more Liberty stock surged, the more Southeastern’s trade activity seemed to correspond with the stock’s every shift.
With a market cap of $9.86 billion, Liberty is known for operating various digital commerce businesses. On Dec. 11, Liberty announced that it acquired Trip Advisor, now controlling majority voting stake. On the same day, Liberty’s stock hopped from $18.92 to $19.30.
In 12 months, Liberty has maintained positive numbers in revenue growth, EBITDA growth, free cash flow growth and book value growth (view its 10-Year Financials).
It has a 7 in Profitability and Growth and 5 in Financial Strength. Its Business Predictability rank is 1 star.
Also with a Business Predictability of 1 star is Alabama-based Vulcan Materials Company. With a market cap of $6.74 billion, Vulcan has built a reputation as the nation’s leading producer of construction aggregates and major producer of other construction materials.
Southeastern began its holding with Vulcan in the third quarter of 2010. Over the following quarters, the fund has purchased a total of 12.8 million shares, and has sold 616,710 shares.
Starting off with 5.3 million shares, Southeastern grew its holding to 9.9 million shares.
Vulcan’s Warning Signs reveal a dividend yield close to a five-year low, a P/B ratio close to a three-year high and a P/S ratio close to a two-year high. The signs also indicate a declining per share revenue and gross margin, as well as poor financial strength.
In its 10-Year Financials, Vulcan shows lack of stability in revenue, EBITDA, free cash flow and book value.
To view more of Mason Hawkins’ recent trades, visit his latest stock picks. Also view his high-yield stocks, top growth companies and undervalued picks.
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Guru Discussed: Mason Hawkins: Current Portfolio, Stock Picks
Stocks Discussed: LINTA, VMX,