Mohnish Pabrai has made a dramatic comeback with his hedge funds after a terrible loss in 2008. His Pabrai Fund III lost 60% in 2008, then gained 125% in 2009, and 34.4% in 2010. After the deep loss in 2008, Mohnish Pabrai has been retooling his strategies. He has since increased the numbers of stocks in his portfolios, and has been developing a checklist approach for his investment decision making.
With his new checklist approach, some of the stocks he owned before may not make it into his portfolio any more. This might be the reason he keeps selling certain stocks.
By the way, we have added a tab called “High Conviction” to gurus’ portfolios for the stocks that gurus keeps on buying. For instance, you can check out the complete list of the stocks that George Soros keeps on buying
No. 1: Air Transport Services Group Inc (NASDAQ:ATSG), Weightings: 5.15% - 2,132,001 Shares
AIR TRANSPORT SERVICES GROUP, INC. is a provider of air cargo transportation and related services to domestic and foreign air carriers and other companies that outsource their air cargo lift requirements. Air Transport Services Group Inc has a market cap of $521.4 million; its shares were traded at around $8.19 with a P/E ratio of 13 and P/S ratio of 0.8. Air Transport Services Group Inc had an annual average earnings growth of 0.2% over the past 10 years.
Mohnish Pabrai owns 2,132,001 shares of ATSG, valued as $17 million as of Dec. 31, 2010, which accounts for 5.15% of his equity portfolio. Mohnish Pabrai reduced his positions in the Sep. 30, 2010 quarter by 10.51%, again in the Dec. 31, 2010 quarter by 43.4%. Pabrai got his position in Air Transport Services from the spin-off of ABX Air. He has had a wild ride with this position. Now he is close to breakeven with the position.
This is Mohnish Pabrai’s holding history with the stock after it was spun off.
No. 2: Pinnacle Airlines Corp. (PNCL), Weightings: 4.79% - 1,985,902 Shares
Pinnacle Airlines Corp., a regional airline, offers scheduled passenger service throughout the United States. Pinnacle Airlines Corp. has a market cap of $113 million; its shares were traded at around $6.06 with a P/E ratio of 5.8 and P/S ratio of 0.1.
Mohnish Pabrai owns 1,985,902 shares of PNCL, valued as $16 million as of Dec. 31, 2010, which accounts for 4.79% of his equity portfolio. Mohnish Pabrai reduced his positions in the Sep. 30, 2010 quarter by 0.2%, again in the Dec. 31, 2010 quarter by 0.65%. All these were after reductions of shares in the second quarter of 2008 and the second quarter of 2009. Mohnish is probably losing money with this position. But with his new checklist approach, it is very likely that Pinnacle Airlines cannot make into his portfolio any more.
Pinnacle has been in expansion mode. The company has seen a 44% growth in number of passengers serviced. The revenue passenger miles grew 65% in the first two months of 2011.
No. 3: Harvest Natural Resources Inc (NYSE:HNR), Weightings: 3.39% - 912,018 Shares
Harvest Natural Resources, Inc. is an independent oil and gas exploration and development company with principal operations in Venezuela and Russia. Harvest Nat Res Inc has a market cap of $494.3 million; its shares were traded at around $14.55 with a P/E ratio of 41.6 and P/S ratio of 46.2.
Mohnish Pabrai owns 912,018 shares of HNR, valued as $11 million as of Dec. 31, 2010, which accounts for 3.39% of his equity portfolio. Mohnish Pabrai reduced his positions in the Sep. 30, 2010 quarter by 16.02%, again in the Dec. 31, 2010 quarter by 75.83%. His selling started a year ago, it won’t be surprising if he sells out this position completely in the last quarter.
Mohnish Pabrai started buying Harvest Natural Resources in 2006 at around $12 a share. The stock price declined afterwards. It is now back to about where it was in 2006. Mohnish reduced the position at lower prices.
Strategy modification probably prompted the changes in Mohnish Pabrai’s portfolios. He has been reducing Air Transport Services Group Inc, Pinnacle Airlines Corp., Harvest Natural Resources at losses.
Check out the complete list of the stocks that Mohnish Pabrai owns or the complete list of the stocks that George Soros keeps on buying