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Third Avenue Management’s High-Return Four

October 12, 2013 | About:
Sally Jones

Sally Jones

49 followers
Third Avenue Management, considered a “balance sheet investor,” has a portfolio of 145 stocks, 18 of them new, and a total value of $5.09 billion, with a quarter-over-quarter turnover of 8%. The portfolio is currently weighted with top three sectors: financial services at 20.5%, basic materials at 15% and technology at 14.9%. The firm has averaged a return of 11.41% over 12 months. In 2012, Third Avenue Management returned 27.48% against the S&P500’s 15.4%.

Led by its founder and chairman, Martin Whitman, Third Avenue Management measures a company’s value based on its current balance sheet versus projected earnings and revenues. As such, Third Avenue Management is focused on the here and now reality of a business, investing in safe companies that are priced low.

Here’s a review of the four companies with the highest rate of return in the firm’s portfolio, all of which were new buys in the second quarter of 2013.

Post Properties Inc. (PPS)

Rate of Return: 30.76%

Down 6% over 12 months, Post Properties Inc., a residential REIT, has a market cap of $2.46 billion; its shares were traded at around $45.02. The tangible book value is 20.98. PPS trades with a P/E ratio of 29.00 and a P/B of 2.10. The earnings yield is 2.80%.

Guru Action: As of Sept. 30, 2013, Third Avenue Management holds 422,734 shares values at around $20.9 million.

PPS is a relatively new holding for the firm, first bought in the second quarter of 2013. The firm bought 422,734 shares at an average price of $49.04, for a loss of 8.2%.

Track historical pricing, revenue and net income since 1993:

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Valley National Bancorp (VLY)

Rate of Return: 26.4%

Up 5% over 12 months, Valley National Bancorp has a market cap of $2.07 billion; its shares were traded at around $10.40. The tangible book value is 5.28. VLY trades with a P/E ratio of 14.60 and a P/B of 1.30. The earnings yield is 3.80%.

Guru Action: As of Sept. 30, 2013, Third Avenue Management holds 1,462,501 shares values at around $13.8 million.

VLY is another new holding for Third Avenue, first buying 1,462,501 shares in the second quarter of 2013, at an average price of $9.34, for a gain of 11.3%.

Track historical pricing, revenue and net income since 1990:

1381603046239.png

Brookdale Senior Living Inc. (BKD)

Rate of Return: 23.14%

Up 11% over 12 months, Brookdale Senior Living Inc. has a market cap of $3.35 billion; its shares were traded at around $26.94. The tangible book value is 5.97. BKD trades with a P/B of 3.30. The earnings yield is 1.80%.

Guru Action: As of Sept. 30, 2013, Third Avenue Management holds 658,866 shares values at around $17.429 million.

Bought in the second quarter of 2013, BKD is another new holding for Third Avenue. The firm made a new buy of 658,866 shares at an average price of $27.55, for a 2.2% loss.

Track historical pricing, revenue and net income:

1381603273950.png

Cubic Corporation (CUB)

Rate of Return: 22.54%

Up 2% over 12 months, Cubic Corporation, an aerospace and defense company,has a market cap of $1.38 billion; its shares were traded at around $51.76. The tangible book value is 20.98. CUB trades with a P/E ratio of 17.40 and a P/B of 1.90. The earnings yield is 8.60%.

Guru Action: As of Sept. 30, 2013, Third Avenue Management holds 342,405 shares values at around $16.47 million.

CUB is another new holding for Third Avenue, first buying 342,405 shares in the second quarter of 2013, at an average price of $45.71 for a gain of 13.2%.

Track historical pricing, revenue and net income:

1381603484869.png

Here’s a graphic summary of Third Avenue Management’s top buys, sells and holdings:



Study the rest of Third Avenue Management’s portfolio.

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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: 2.8/5 (4 votes)

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