We have just updated the portfolio holdings of Fairholme Fund. The current portfolio date is Aug. 31, 2010. If you are not aware of, in order to track Bruce Berkowitz more closely, we track both of the his firm’s portfolio, Fairholme Capital Management, and Fairholme Fund. The Fairholme Capital Management portfolio is filed under his name. The two portfolios have different fiscal periods, therefore we can track the portfolio moves more closely.
Fairholme Fund is certainly one of the best mutual fund around. During past 10 years, the fund has averaged 11.31% annually. The market average as measured by S&P500 has a negative return over the same period. As of 9/30, the fund had a YTD return of 8.88%.
We know that Bruce Berkowitz is moving heavily into financials. He is adding more. These are the changes of the sector weightings of Fairholme Fund during the past two quarters:
Fairholme fund has reduced consumer services, and added more into financials. Financial stocks are now accounted for more than 70% of the fund. Why is this? Mr. Berkowitz wrote in his most recent semi-annual report:
“Over one-half of The Fairholme Fund’s assets are invested in securities of mostly hateed financial services and real estate related companies…. Financials tend of lead markets into and then out of recessions followed by asset deflation and then inflation… Portfolio are positioned for today’s nascent recovery with its fits and starts.”
Mr. Berkowitz did not discuss specific positions, as he did before with holdings like Canadian Natural Resources, or Pfizer etc. The investing in financials seems to be more macro market based rather than bottom up value investing oriented.
These are details of the stocks that Fairholme keeps adding until the quarter ended 8/31.
No. 1: Citigroup Inc. (C), Weightings: 8.31% - 202,896,100 Shares
Fairholme Fund owns 202,896,100 shares of C, valued as $755 million as of Aug. 31, 2010, which accounts for 8.31% of his equity portfolio. Fairholme Fund added his positions in the May. 31, 2010 quarter by 4.21%, again in the Aug. 31, 2010 quarter by 0.5%.
Citigroup Inc. has a market cap of $130.1 billion; its shares were traded at around $4.49 with and P/S ratio of 1.43.
No. 2: Bank of America Corp. (BAC), Weightings: 8.3% - 60,567,115 Shares
Fairholme Fund owns 60,567,115 shares of BAC, valued as $754 million as of Aug. 31, 2010, which accounts for 8.3% of his equity portfolio. Fairholme Fund added his positions in the May. 31, 2010 quarter by 16.23%, again in the Aug. 31, 2010 quarter by 45.5%.
Of America Corp. has a market cap of $124.02 billion; its shares were traded at around $12.36 with a P/E ratio of 56.18 and P/S ratio of 0.82. The dividend yield of Bank Of America Corp. stocks is 0.32%.
Bank of America has quite some buying activities from its executives including CEO and CFO. CEO and President Brian T Moynihan bought 30,000 shares of BAC stock on 08/23/2010 at the average price of 13.03. Brian T Moynihan owns at least 453,727 shares after this. The price of the stock has decreased by 5.14% since. CFO Charles H Noski bought 6,000 shares of BAC stock on 07/23/2010 at the average price of 13.6. Charles H Noski owns at least 21,000 shares after this. The price of the stock has decreased by 9.12% since.
No. 3: Berkshire Hathaway Inc. (BRK.A), Weightings: 5.3% - 4,059 SharesFairholme Fund owns 4,059 shares of BRK.A, valued as $482 million as of Aug. 31, 2010, which accounts for 5.3% of his equity portfolio. Fairholme Fund added his positions in the May. 31, 2010 quarter by 7.35%, again in the Aug. 31, 2010 quarter by 2.53%.
Berkshire Hathaway Inc. has a market cap of $206.8 billion; its shares were traded at around $125560 with a P/E ratio of 23.7 and P/S ratio of 2.2. Berkshire Hathaway Inc. had an annual average earning growth of 3.7% over the past 10 years.
To check the complete list of of Fairholme Fund, please go to http://www.gurufocus.com/holdings.php?GuruName=Fairholme+Fund. Please also check out these: Fairholme Fund Top Holdings, Low P/E stocks, High Yield Stocks, Top Predictable Companies, Top Growth Companies