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Guru Mark Hillman's Third Quarter Top Five Stocks

November 08, 2013 | About:
Monica Wolfe

Monica Wolfe

133 followers
Mark Hillman is the President of Hillman Capital Management, the fund he created in 1998. Over the third quarter Hillman purchased three new holdings, bringing his total portfolio to 39 stocks valued at $65 million.

According to the guru’s investing philosophy, he invests in companies which have quantitative competitive advantages and have temporarily fallen out of favor for reasons that are considered non-recurring or short-term. Hillman looks at factors such as cash flow, dividends, sales, earnings, book value and projected growth rate.

The following five companies represent Mark Hillman’s top five portfolio holdings.

Boeing Co (BA)

Hillman’s largest position is in Boeing where he maintains 25,861 shares of the company’s stock. His position in Boeing represents 5.1% of his total portfolio.

During the third quarter Hillman upped his stake by 28.23%. The guru bought 5,694 shares in the third quarter price range of $101.47 to $119.34, with an estimated average quarterly price of $107.71. Since then the price per share is up about 22.2%.

In the past five years Hillman has seen average gains of 164% on shares bought. The guru’s historical holding history as of the close of the third quarter:

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Boeing is engaged in the design, development, manufacture, sale and support of commercial jetliners, military aircraft, satellites, missile defense, human space flight and launch systems and services. It operates in five segments: Commercial Airplanes, Boeing Military Aircraft, Network and Space Systems, Global Services and Support and Boeing Capital Corporation.

Boeing’s historical revenue and net income:

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The analysis on Boeing reports that the company’s dividend yield is near a 5-year low, its price is sitting near its 10-year high, it has shown predictable revenue and earnings growth and its operating margin is expanding.

The top guru shareholders of Boeing:

1. Andreas Halvorsen: 7,995,460 shares, representing 1.06% of the company’s shares outstanding and 4.6% of his total portfolio.

2. PRIMECAP Management: 3,659,591 shares, representing 0.49% of the company’s shares outstanding and 0.54% of their total portfolio.

3. Brian Rogers: 2,676,900 shares, representing 0.35% of the company’s shares outstanding and 1.2% of his total portfolio.

The Peter Lynch Chart suggests that Boeing is currently overvalued:

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Boeing has a market cap of $100.3 billion. Its shares are currently trading at around $133.11 with a P/E ratio of 23.60, a P/S ratio of 1.20 and a P/B ratio of 11.20. The company had an annual average earnings growth of 14.30% over the past ten years.

GuruFocus rated Boeing the business predictability rank of 3-star.

American Express (AXP)

Hillman’s second largest position is in American Express where he holds on to 36,508 shares of the company’s stock. Hillman’s position makes up for 4.7% of his total portfolio.

During the third quarter Hillman made a slight decrease of his holdings by cutting -3.65%. The guru sold 1,383 shares in the price range of $71.90 to $78.33, with an estimated average quarterly price of $75.23. Since then the price per share is up approximately 7.8%.

Hillman has held on to American Express since 2008Q4, and since then he has seen average gains of 90% on shares bought. Hillman’s historical holding history of American Express:

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American Express together with its subsidiaries is a global service company that provides customers with access to products, insights and experiences that enrich lives and build business success. Its principal products and services are charge and credit payment card products.

American Express’s historical revenue and net income:

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The analysis on American Express reports that the company’s dividend yield is near a 5-year low, its price is sitting near a 10-year high and its operating margin is expanding. It also reports that American Express has shown predictable revenue and earnings growth.

The top guru shareholders of American Express:

1. Warren Buffett: 151,610,700 shares, representing 14.05% of the company’s shares outstanding and 12.7% of his total portfolio.

2. Chris Davis: 37,779,862 shares, representing 3.5% of the company’s shares outstanding and 7.2% of his total assets managed.

3. James Barrow: 21,800,089 shares, representing 2.02% of the company’s shares outstanding and 2.7% of the company’s shares outstanding.

The Peter Lynch Chart suggests that the company is currently overvalued:

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American Express has a market cap of $87.51 billion. Its shares are currently trading at around $81.69 with a P/E ratio of 19.30, a P/S ratio of 2.70 and a P/B ratio of 4.50. The company had an annual average earnings growth of 6.50% over the past ten years.

GuruFocus rated American Express the business predictability rank of 3.5-star.

Johnson & Johnson (JNJ)

The guru’s third largest holding is in Johnson & Johnson where he maintains 30,829 shares of the company’s stock. His position in the company makes up for 4.4% of his total portfolio.

During the third quarter Hillman made a slight reduction of his position in Johnson & Johnson. The guru decreased his holdings -1.02% by selling 318 shares of the company’s stock. He sold these shares at an estimated average quarterly price of $89.71%, and since then the share price has gone up about 3.5%.

Hillman’s historical holding history:

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Johnson & Johnson is engaged in the research and development, manufacture and sale of a range of products in the health care field. The company has three operating segments which are: Consumer, Pharmaceutical and Medical Devices and Diagnostics.

Johnson & Johnson’s historical revenue and net income:

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The analysis on Johnson & Johnson reports that the company has shown predictable revenue and earnings growth, its operating margin is expanding and that its price is sitting near its 10-year high.

The top guru shareholders of Johnson & Johnson:

1. Jeremy Grantham: 23,171,691 shares, representing 0.82% of the company’s shares outstanding and 5.2% of his total portfolio.

2. James Barrow: 17,156,379 shares, representing 0.61% of the company’s shares outstanding and 2.5% of his total assets managed.

3. PRIMECAP Management: 13,996,087 shares, representing 0.5% of the company’s shares outstanding and 1.7% of their total assets managed.

The Peter Lynch Chart suggests that the company is currently overvalued:

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Johnson & Johnson has a market cap of $263.86 billion. Its shares are currently trading at around $93.52 with a P/E ratio of 20.80, a P/S ratio of 3.80 and a P/B ratio of 3.80. Johnson & Johnson’s current dividend yield is set at 2.70%. The company had an annual average earnings growth of 6.60% over the past ten years.

GuruFocus rated Johnson & Johnson the business predictability rank of 2.5-star.

Bank of America (BAC)

Hillman’s fourth largest position is in Bank of America where the guru holds on to 204,090 shares of the company’s stock. His position represents 4.4% of his total assets managed.

During the third quarter Hillman cut his holdings in Bank of America by 10.2%. The guru sold 23,192 shares in the price range of $12.83 to $14.95, with an estimated average quarterly price of $14.27. Since then the price per share has dropped approximately -1.9%.

Mark Hillman’s historical holding history of Bank of America:

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Bank of America, through its subsidiaries, provides a diversified range of banking and non-banking financial services and products through five business segments: Deposits, Card Services, Consumer Real Estate Services, Global Commercial Banking, Global Banking & Markets and Investment Management.

Bank of America’s historical revenue and net income:

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The analysis on Bank of America reports that the company’s dividend yield is near a 10-year low and that its revenue has been in decline over the past five years.

The top guru shareholders of Bank of America:

1. Dodge & Cox: 127,292,188 shares, representing 1.18% of the company’s shares outstanding and 1.9% of their total assets managed.

2. Bruce Berkowitz: 100,948,615 shares, representing 0.94% of the company’s shares outstanding and 16.9% of his total portfolio.

3. Fairholme Fund: 81,607,015 shares, representing 0.76% of the company’s shares outstanding and 16% of its shares outstanding.

The Peter Lynch Chart suggests that the company is currently overvalued:

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Bank of America has a market cap of $151.25 billion. Its shares are currently trading at around $14.18 with a P/E ratio of 21.80, a P/S ratio of 1.80 and a P/B ratio of 0.70.

Apple (AAPL)

Mark Hillman’s fifth largest holding is in Apple where the guru maintains 5,147 shares of the company’s stock. His position in Apple makes up for 4.1% of his total portfolio.

Hillman reduced his position in Apple by -4.49% over the duration of the third quarter. The guru sold 242 shares of his stake in the company for an estimated average quarterly price of $464.25 per share. Since then the price per share has increased approximately 12.6%.

Hillman’s historical holding history:

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Apple designs, manufactures, and markets personal computers, mobile communication devices, and portable digital music and video players and sell a variety of related software, services, peripherals, and networking solutions.

Apple’s historical revenue and net income:

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The analysis on Apple reports that the company’s revenue has slowed over the past year, its asset growth is notably faster than its revenue growth and its operating margin is expanding.

The Peter Lynch Chart suggests that the company is currently undervalued:

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Apple has a market cap of $467.24 billion. Its shares are currently trading at around $519.30 with a P/E ratio of 13.10, a P/S ratio of 2.80 and a P/B ratio of 3.70. The company currently holds a dividend yield of 2.30% and has seen an annual average earnings growth of 64.50% over the past ten years.

GuruFocus rated Apple the business predictability rank of 4.5-star.

Check out Mark Hillman’s complete third quarter portfolio here.

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Rating: 3.5/5 (4 votes)

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