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Chris Davis' Top Five Positions

November 14, 2013 | About:
Monica Wolfe

Monica Wolfe

119 followers
Over the past quarter Chris Davis of Davis Selected Advisers reported a total portfolio of 181 stocks valued at $38.5 billion. The guru purchased 17 new stocks over the quarter.

The Davis Funds select their stocks based on the types of businesses that they would want to own. Their criterion includes companies with proven management and durable, financially strong business models as well as companies with sustainable competitive advantages.

The following five companies represent Chris Davis’ top five stock positions.

American Express (AXP)

Davis’ largest position is in American Express where he holds on to a total of 37,113,556 shares of the company’s stock. His holdings make up for 7.3% of his total holdings and 3.44% of the company’s shares outstanding.

During the past quarter Davis made a slight reduction of his holdings. The guru reduced his position -1.76% by selling 666,306 shares. He sold these shares in the quarterly price range of $71.91 to $78.33, with an estimated average quarterly price of $75.23. Since then the price per share has increased approximately 8.8%.

Davis’ historical holding history:

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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: 37,113,556 shares, representing 3.44% of the company’s shares outstanding and 7.3% of his entire portfolio.

3. James Barrow: 21,912,307 shares, representing 2.03% of the company’s shares outstanding and 2.6% of his total assets managed.

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

1384454384623.png

American Express has a market cap of $87.7 billion. Its shares are currently trading at around $81.87 with a P/E ratio of 19.10, a P/S ratio of 2.80 and a P/B ratio of 4.60. 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.

Bank of New York Mellon Corp (BK)

The guru’s second largest holding is in Bank of New York Mellon Corp where he maintains 86,506,461 shares of the company’s stock. Davis’ position makes up for 6.8% of his total portfolio as well as 7.52% of the company’s shares outstanding.

During the third quarter Davis reduced his holdings -0.85% by selling 742,724 shares. He sold these shares in the third quarter price range of $28.26 to $32.21, with an estimated average quarterly price of $30.67. Since then the price per share has increased approximately 7.7%

Davis’ historical holding history:

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The company is a global financial services company. Bank of New York Mellon provides a comprehensive array of services that enable institutions and individuals to manage and service their financial assets in more than 100 markets worldwide.

Bank of New York Mellon’s historical revenue and net income:

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The analysis on BK reports that the company’s dividend yield is at a two-year low, its price is nearing a three-year high, they have issued $3.2 billion of debt over the past three years and the company’s interest coverage is comfortable.

The top guru shareholders of Bank of New York Mellon Corp:

1. Chris Davis: 86,506,461 shares, representing 7.52% of the company’s shares outstanding and 6.8% of his total assets managed.

2. Dodge & Cox: 58,667,454 shares, representing 5.1% of the company’s shares outstanding and 2% of their total portfolio.

3. Mason Hawkins: 42,552,669 shares, representing 3.7% of the company’s shares outstanding and 5.9% of his total portfolio.

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

1384455866577.png

Bank of New York Mellon Corp has a market cap of $37.95 billion. Its shares are currently trading at around $33.04 with a P/E ratio of 18.00, a P/S ratio of 2.60 and a P/B ratio of 1.10.

Wells Fargo (WFC)

Chris Davis’ third largest position is in Wells Fargo where he currently owns 58,932,056 shares. His holdings make up for 6.3% of his total portfolio and 1.11% of Wells Fargo’s shares outstanding.

During the third quarter Davis decreased his holdings -2.43% by selling 1,468,906 shares of the company’s stake. He sold these shares in the quarterly price range of $41.11 to $44.63, with an estimated average quarterly price of $42.69. Since then the price per share is up a slight 0.3%.

Davis’ holding history as of the close of the third quarter:

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Wells Fargo is a financial services companies, providing a range of retail banking and brokerage, asset and wealth management and corporate and investment banking products and services to customers.

Wells Fargo’s historical revenue and net income:

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The analysis on Wells Fargo reports that the company’s operating margin is expanding, its dividend yield is close to a 3-year high, its price is near a 10-year high and its revenue has been in decline over the past three years.

The top guru shareholders of WFC:

1. Warren Buffett: 463,131,623 shares, representing 8.72% of the company’s shares outstanding and 21.5% of his entire portfolio.

2. Dodge & Cox: 74,262,403 shares, representing 1.4% of the company’s shares outstanding and 3.5% of his total portfolio.

3. Chris Davis: 58,932,056 shares, representing 1.11% of the company’s shares outstanding and 6.3% of his total portfolio.

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

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Wells Fargo has a market cap of $226.45 billion. Its shares were traded at around $42.99 with a P/E ratio of 11.20, a P/S ratio of 2.70 and a P/B ratio of 1.50. The company offers a dividend yield of 2.70%. Wells Fargo had an annual average earnings growth of 1.60% over the past ten years.

Google (GOOG)

Google is Chris Davis’ fourth largest position. The guru holds on to 2,666,808 shares of the company’s stock, representing 6.1% of his total portfolio and 0.80% of the company’s shares outstanding.

During the third quarter Davis reduced his position by -0.45%. The guru sold a total of 11,939 shares in the quarterly price range of $846.90 to $924.69, with an estimated average quarterly price of $887.31 per share. Since then the price per share has jumped up about 17%.

Davis’s historical holding history:

1384460043134.png

Google is a global technology company engaged in improving the ways people connect with information. The company's business is mainly focused around the following key areas: search, advertising, operating systems and platforms, enterprise and hardware products.

Google’s historical revenue and net income:

1384457644801.png

The analysis on Google reports that the company’s price is near a 10-year high, the company has issued $5 billion of debt over the past three years, its interest coverage is comfortable and it’s shown signs of predictable revenue and earnings growth.

The top guru shareholders of Google:

1. PRIMECAP: 3,058,842 shares, representing 0.92% of the company’s shares outstanding.

2. Frank Sands: 2,776,485 shares, representing 0.83% of the company’s shares outstanding.

3. Chris Davis: 2,666,808 shares, representing 0.8% of the company’s shares outstanding.

The Peter Lynch Chart suggests that Google is currently overvalued:

1384457820157.png

Google has a market cap of $346.7 billion. Its shares are currently trading at around $1037.75 with a P/E ratio of 27.70, a P/S ratio of 5.90 and a P/B ratio of 4.10. The company had an annual average earnings growth of 44.00% over the past 10 years.

GuruFocus rated Google the business predictability rank of 2.5-star.

CVS Caremark (CVS)

The guru’s fifth largest position goes to CVS where he holds on to a total of 36,448,058 shares of the company’s stock. This holding takes up 5.4% of his total portfolio as well as 2.97% of the company’s shares outstanding.

During the third quarter Davis cut his holdings -6.3% by selling a total of 2,448,543 shares of the company’s stock. He sold these shares at an estimated average quarterly price of $59.59 per share and since then the price per share has jumped up about 9.6%.

Davis’ historical holding history:

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CVS Caremark provides pharmacy healthcare services in the U.S. It has three reportable business segments: Pharmacy Services, Retail Pharmacy and Corporate.

CVS Caremark’s historical revenue and net income:

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CVS's revenue growth has recently beaten the industry average of 2.5%. Since last year, the company’s revenues have increased by 1.7%. CVS improved its earnings per share by 21.3% in the most recent quarter compared to the same quarter last year.

The top three guru shareholders of CVS:

1. Chris Davis: 36,448,058 shares, representing 2.97% of the company’s shares outstanding and 5.4% of his total portfolio.

2. First Pacific Advisors: 7,357,900 shares, representing 0.6% of the company’s shares outstanding and 4.5% of their total portfolio.

3. Steven Romick: 6,805,000 shares, representing 0.55% of the company’s shares outstanding and 5.6% of his total portfolio.

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

1384458498928.png

CVS has a market cap of $77.71 billion. Its shares are currently trading at around $65.29 with a P/E ratio of 19.30, a P/S ratio of 0.60 and a P/B ratio of 2.00. The company had an annual average earnings growth of 13.80% over the past ten years.

GuruFocus rated CVS the business predictability rank of 4-star.

Check out Davis’ full third quarter portfolio here.

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Rating: 4.0/5 (6 votes)

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