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Highest Return Guru at 266%, Michael Dell Reduces Three

August 26, 2013 | About:
Sally Jones

Sally Jones

49 followers
With a net worth estimated at $15.3 billion, Michael Dell has the highest average return of any guru, with 266.63% over 12 months. He is followed by John Paulson with an average return of 251.42% over 12 months. Only seven gurus return more than 50% over the same period. To offer perspective on Michael Dell’s average return, the majority of billionaire investors return around 30% or less over 12 months. Clearly, Guru Dell is a fascinating study in wealth-building and his trades are worthy of study.

One of the world’s richest, Dell manages his personal wealth through MSD Capital, founded in 1998. MSD Capital invests in public equity, private equity and real estate. The updated portfolio has 8 stocks, none of them new, with a total value of $563 million, and a quarter-over-quarter turnover of 2%. The current portfolio is heavily weighted with consumer cyclical at 82.9%, followed by technology at 12.5%, real estate at 2.43%, industrials at 1.6% and basic materials at 0.8%.

MSD Capital has a concentrated portfolio, trading relatively little in the second quarter. Here are Michael Dell’s reductions and the company updates, as of June 30, 2013.

REDUCED: FutureFuel Corp. (FF)

Impact to Portfolio: -2.15%

Current Shares: 296,959

Up 63% over 12 months, FutureFuel Corp. has a market cap of $731 million; its shares were traded at around $16.88, with a P/E of 14.10. The P/B ratio is 2.40. The company produces biofuels and chemical products used in detergent, agrochemical, automotive, photographic imaging, coatings, nutrition and polymer additives.

Track historical pricing:

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Guru Action: As of June 30, 2013, Dell reduced his position by 76.86%, selling 986,566 shares at an average price of $13.4, for a gain of 25.9%.

He has averaged a gain of 33% on 3,600,000 shares bought at an average price of $12.64 per share. On shares sold, he has averaged a gain of 33% on 3,303,041 shares sold at an average price of $12.7 per share.

FutureFuel Corp. reported financial results for the three months ended June 30, 2013, with revenue of $106.1 million, up 3% from $103.2 million in the second quarter of 2012. Adjusted EBITDA was $25.3 million, up 327% from $5.9 million in the same quarter a year ago. The company’s net income increased to $18.2 million, or $0.42 per diluted share, from $8.5 million, or $0.20 per diluted share.

REDUCED: Delphi Automotive PLC (DLPH)

Impact to Portfolio: -2.03%

Current Shares: 1,549,817

Up 89% over 12 months, Delphi Automotive PLChas a market cap of $17.32 billion; its shares were traded at around $55.83, with a P/E of 16.80. The P/B ratio is 7.00.

Track historical pricing:

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Guru Action: As of June 30, 2013, Dell reduced his position by 13.89%, selling 250,000 shares at an average price of $46.86, for a gain of 19.1%.

He has averaged a gain of 68% on 1,949,817 shares bought at an average price of $33.29 per share. On shares sold, he has averaged a gain of 26% on 400,000 shares sold at an average price of $44.43 per share.

The company reported second quarter 2013 revenue of $4.2 billion, an increase of 1% compared to the second quarter of 2012, adjusting for currency exchange, commodity movements, acquisitions and divestitures. This reflects growth of 9% in Asia, 4% in North America and 13% in South America, offset by a decline in Europe of 7%, according to a company press release.

REDUCED: Energy XXI (Bermuda) Ltd. (EXXI)

Impact to Portfolio: -0.46%

Current Shares: 405,000

Down 20% over 12 months, Energy XXI, an independent oil and natural gas exploration and production company, has a market cap of $2.03 billion; its shares were traded at around $26.84, with a P/E of 15.20. The P/B ratio is 1.50.

Track historical pricing:

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Guru Action: As of June 30, 2013, Dell reduced his position by 18.25%, selling 90,385 shares at an average price of $24.52, for a gain of 9.7%.

He has averaged a gain of 103% on 7,055,896 shares bought at an average price of $13.22 per share. On shares sold, he has averaged a gain of 4% on 6,650,896 shares sold at an average price of $25.91 per share.

For the second quarter of 2013, the company reported a net profit margin of 19.74%, an operating margin of 35.55%, a return on average assets of 7.05%, and a return on equity of 16.46%. Energy XXI revenue decreased 8.09% to $314.3 million from the same quarter one year ago.

Michael Dell is the founder, chairman and CEO of the computer company Dell Inc.

Here is the complete portfolio of Michael Dell.





Be sure to read:

1. Michael Dell's Undervalued Stocks

2. Michael Dell's Top Growth Companies

3. Michael Dell's High Yield stocks

4. Stocks that Michael Dell keeps buying

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About the author:

Sally Jones
Sally Jones writes about Real Time Picks. She says, "I truly enjoy watching the Gurus in realtime and telling their story."

Rating: 3.3/5 (4 votes)

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