As of the second quarter Richard Pzena, the founder and co-chief investment officer at Pzena Investment Management, held 122 stocks (seven of which he bought during the quarter) valued at over $15 billion.
The following five stocks are the companies he holds the largest stake in.
Hewlett-Packard (HPQ)
Richard Pzena’s top holding is in the computer company Hewlett-Packard. The guru currently holds 32,922,187 shares of Hewlett-Packard, representing 1.69% of the company’s shares outstanding and 5.4% of his total portfolio. Richard Pzena is the second largest guru shareholder of HPQ.
During the second quarter, Pzena made a minor decrease to his holdings in HP. The guru reduced his position-4.09% by selling a total of 1,403,698 shares. He sold these shares at an average price of $22.48 per share. Since this sell, the share price has increased 19.1%.
Pzena’s holding history as of the second quarter:
HP is the world’s largest technology company that brings together a portfolio that spans printing, personal computing, software, services and IT infrastructure to solve customer problems.
HP’s historical revenue and net income:
The company’s second quarter financials reported:
· Non-GAAP diluted EPS of $0.87, down 11% from the prior year.
· GAAP diluted EPS of $0.55, down 31% from last year.
· Net revenue of $27.6 billion, down 10% from last year.
· Cash flow from operations of $3.6 billion, up 44% from last year.
· Returned $1.1 billion in cash to share holders in dividends and share buybacks.
Hewlett-Packard has a market cap of $51.63 billion. Its shares are currently trading at around $26.77 with a P/E ratio of 5.30, a P/S ratio of 0.50 and a P/B ratio of 2.10. The company currently maintains a dividend yield of 2%.
Staples (SPLS)
Pzena’s second largest holding is in Staples. The guru holds on to 34,969,289 shares of Staples, representing 5.23% of the company’s shares outstanding and 3.7% of his total portfolio.
During the second quarter Pzena cut his holdings by 10.22% by selling a total of 3,979,046 shares. He sold these shares at an average price of $14.31 per share and since this reduction, the share price has increased an additional 18.4%.
Pzena’s holding history as of June 30:
Staples is an office products company. Its three reportable segments are North American Delivery, North American Retail and International Operations.
Staples’ historical revenue and net income:
Staples has a market cap of $11.25 billion. Its shares are currently trading at around $16.95 with a P/E ratio of 11.70, a P/S ratio of 0.50 and a P/B ratio of 1.80. The company’s dividend yield is at 2.70%. The company had an annual average earnings growth of 3.2% over the past 10 years.
Omnicom Group (OMC)
Richard Pzena’s third largest holding is in Omnicom Group where he holds 3.2% of his portfolio. As of the second quarter, the guru holds on to 7,662,119 shares of Omnicom, representing 2.93% of the company’s shares outstanding.
During the second quarter Pzena made a slight increase to his holdings in Omnicom, increasing his position by 1.29%. The guru bought 97,938 shares at an average price of $61.30 per share. Since his increase, the price per share is up about 2.3%.
Pzena’s holding history of Omnicom as of the second quarter:
Omnicom is a global advertising, marketing and corporate communications company. Omnicom provides professional services to clients through multiple agencies operating in all main markets around the world.
Omnicom’s historical revenue and net income:
The Peter Lynch Chart shows that Omnicom currently appears to be overvalued:
Omnicom has a market cap of $16.12 billion. Its shares are currently trading at around $62.68 with a P/E ratio of 16.40, a P/S ratio of 1.20 and a P/B ratio of 5.50. The company had an annual average earnings growth of 7.4% over the past 10 years.
GuruFocus rated Omnicom the business predictability rank of 3.5-star.
American International Group (AIG)
American International Group comes in as Brandes’ fourth largest holding where the guru holds 3.1% of his total portfolio. Brandes owns 10,562,975 shares of AIG, representing 0.72% of the company’s shares outstanding.
During the second quarter Brandes made a slight reduction in his holdings of AIG. The guru cut his holdings by 1.71% by selling 183,343 shares of the company’s stock. Since that sell, the price per share has increased approximately 55%.
Pzena’s holding history as of the second quarter:
AIG is a holding company which, through its subsidiaries, is engaged in a range of insurance and insurance-related activities in the United States and abroad. The Company's four reportable segments are as follows: General Insurance, Domestic Life Insurance & Retirement Services, Foreign Life Insurance & Retirement Services and Financial Services.
AIG’s historical revenue and net income:
The Peter Lynch Chart shows that AIG appears to be overvalued:
American International Group has a market cap of $70.91 billion. Its shares are currently trading at around $48.03 with a P/E ratio of 10.40, a P/S ratio of 1.10 and a P/B ratio of 0.70.
Microsoft (MFST)
Pzena’s fifth largest position is in the ever-popular Microsoft. The guru holds 2.9% of his total portfolio in the company. Pzena holds on to 12,425,297 shares of Microsoft, representing 0.15% of the company’s shares outstanding.
During the second quarter Pzena reduced his position in Microsoft by 6.79%. The guru sold a total of 904,583 shares at an average price of $32.76. Since this sell, the price per share has dropped a slight 0.2%.
Pzena’s holding history as of the second quarter:
Microsoft develops, manufactures, licenses and supports a wide range of software products and services for many different types of computing devices.
Microsoft’s historical revenue and net income:
The Peter Lynch Chart shows that Microsoft appears to be undervalued:
Microsoft has a market cap of $272.39 billion. Its shares were traded at around $32.70 with a P/E ratio of 12.70, a P/S ratio of 3.60 and a P/B ratio of 3.50. The company had an annual average earnings growth of 14.3% over the past 10 years.
GuruFocus rated Microsoft the business predictability rank of 3.5-star.
You can view Richard Pzena’s second quarter portfolio here.
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The following five stocks are the companies he holds the largest stake in.
Hewlett-Packard (HPQ)
Richard Pzena’s top holding is in the computer company Hewlett-Packard. The guru currently holds 32,922,187 shares of Hewlett-Packard, representing 1.69% of the company’s shares outstanding and 5.4% of his total portfolio. Richard Pzena is the second largest guru shareholder of HPQ.
During the second quarter, Pzena made a minor decrease to his holdings in HP. The guru reduced his position-4.09% by selling a total of 1,403,698 shares. He sold these shares at an average price of $22.48 per share. Since this sell, the share price has increased 19.1%.
Pzena’s holding history as of the second quarter:
HP is the world’s largest technology company that brings together a portfolio that spans printing, personal computing, software, services and IT infrastructure to solve customer problems.
HP’s historical revenue and net income:
The company’s second quarter financials reported:
· Non-GAAP diluted EPS of $0.87, down 11% from the prior year.
· GAAP diluted EPS of $0.55, down 31% from last year.
· Net revenue of $27.6 billion, down 10% from last year.
· Cash flow from operations of $3.6 billion, up 44% from last year.
· Returned $1.1 billion in cash to share holders in dividends and share buybacks.
Hewlett-Packard has a market cap of $51.63 billion. Its shares are currently trading at around $26.77 with a P/E ratio of 5.30, a P/S ratio of 0.50 and a P/B ratio of 2.10. The company currently maintains a dividend yield of 2%.
Staples (SPLS)
Pzena’s second largest holding is in Staples. The guru holds on to 34,969,289 shares of Staples, representing 5.23% of the company’s shares outstanding and 3.7% of his total portfolio.
During the second quarter Pzena cut his holdings by 10.22% by selling a total of 3,979,046 shares. He sold these shares at an average price of $14.31 per share and since this reduction, the share price has increased an additional 18.4%.
Pzena’s holding history as of June 30:
Staples is an office products company. Its three reportable segments are North American Delivery, North American Retail and International Operations.
Staples’ historical revenue and net income:
Staples has a market cap of $11.25 billion. Its shares are currently trading at around $16.95 with a P/E ratio of 11.70, a P/S ratio of 0.50 and a P/B ratio of 1.80. The company’s dividend yield is at 2.70%. The company had an annual average earnings growth of 3.2% over the past 10 years.
Omnicom Group (OMC)
Richard Pzena’s third largest holding is in Omnicom Group where he holds 3.2% of his portfolio. As of the second quarter, the guru holds on to 7,662,119 shares of Omnicom, representing 2.93% of the company’s shares outstanding.
During the second quarter Pzena made a slight increase to his holdings in Omnicom, increasing his position by 1.29%. The guru bought 97,938 shares at an average price of $61.30 per share. Since his increase, the price per share is up about 2.3%.
Pzena’s holding history of Omnicom as of the second quarter:
Omnicom is a global advertising, marketing and corporate communications company. Omnicom provides professional services to clients through multiple agencies operating in all main markets around the world.
Omnicom’s historical revenue and net income:
The Peter Lynch Chart shows that Omnicom currently appears to be overvalued:
Omnicom has a market cap of $16.12 billion. Its shares are currently trading at around $62.68 with a P/E ratio of 16.40, a P/S ratio of 1.20 and a P/B ratio of 5.50. The company had an annual average earnings growth of 7.4% over the past 10 years.
GuruFocus rated Omnicom the business predictability rank of 3.5-star.
American International Group (AIG)
American International Group comes in as Brandes’ fourth largest holding where the guru holds 3.1% of his total portfolio. Brandes owns 10,562,975 shares of AIG, representing 0.72% of the company’s shares outstanding.
During the second quarter Brandes made a slight reduction in his holdings of AIG. The guru cut his holdings by 1.71% by selling 183,343 shares of the company’s stock. Since that sell, the price per share has increased approximately 55%.
Pzena’s holding history as of the second quarter:
AIG is a holding company which, through its subsidiaries, is engaged in a range of insurance and insurance-related activities in the United States and abroad. The Company's four reportable segments are as follows: General Insurance, Domestic Life Insurance & Retirement Services, Foreign Life Insurance & Retirement Services and Financial Services.
AIG’s historical revenue and net income:
The Peter Lynch Chart shows that AIG appears to be overvalued:
American International Group has a market cap of $70.91 billion. Its shares are currently trading at around $48.03 with a P/E ratio of 10.40, a P/S ratio of 1.10 and a P/B ratio of 0.70.
Microsoft (MFST)
Pzena’s fifth largest position is in the ever-popular Microsoft. The guru holds 2.9% of his total portfolio in the company. Pzena holds on to 12,425,297 shares of Microsoft, representing 0.15% of the company’s shares outstanding.
During the second quarter Pzena reduced his position in Microsoft by 6.79%. The guru sold a total of 904,583 shares at an average price of $32.76. Since this sell, the price per share has dropped a slight 0.2%.
Pzena’s holding history as of the second quarter:
Microsoft develops, manufactures, licenses and supports a wide range of software products and services for many different types of computing devices.
Microsoft’s historical revenue and net income:
The Peter Lynch Chart shows that Microsoft appears to be undervalued:
Microsoft has a market cap of $272.39 billion. Its shares were traded at around $32.70 with a P/E ratio of 12.70, a P/S ratio of 3.60 and a P/B ratio of 3.50. The company had an annual average earnings growth of 14.3% over the past 10 years.
GuruFocus rated Microsoft the business predictability rank of 3.5-star.
You can view Richard Pzena’s second quarter portfolio here.
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