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Omaha’s Other Oracle Wallace Weitz - Top Holdings in Review

December 07, 2013 | About:
Sally Jones

Sally Jones

49 followers
Being known as The Other Oracle of Omaha is a good thing. Wallace “Wally” Weitz of Wallace R. Weitz & Co., is based in Omaha, Neb. His updated portfolio includes 60 stocks, one of them new, a total value of $2.65 billion, with a quarter-over-quarter turnover of 5%. The Weitz portfolio is weighted with top sectors: consumer cyclical at 17.5%, financial services at 15.6%, technology at 13.3% and health care at 13%. The stocks bought by Weitz are averaging a 12-month return of 28.02%. In 2012, he returned 19.72%. His 25-year cumulative return is 11.6% annually.

Weitz's approach to value investing combines Ben Graham's price sensitivity and insistence on a margin of safety. Guru Weitz shares the conviction that qualitative factors that allow a company to have some control over its destiny, such as historical book value or reported earnings, can be more important than statistical measurements.

Here’s an update on four of Weitz’s top holdings.

Valeant Pharmaceuticals International Inc. (VRX)

Weightings: 8%

Current Shares: 2,042,835

Value: $213,129,000

Formerly known as Biovail Corporation, Valeant Pharmaceuticals International Inc. has a market cap of $35.95 billion; its shares were traded at around $107.97 with and P/S ratio of 7.20. The company had an annual average earnings growth of 3% over the past 10 years. The company does not pay a dividend. GuruFocus currently ranks Valeant with one star out of five stars for business predictability.

VRX is a multinational, specialty pharmaceutical company that develops, manufactures and markets a broad range of pharmaceutical products primarily in the areas of neurology, dermatology and branded generics. The company's specialty pharmaceutical and over-the-counter products are marketed under brand names and are sold in the United States, Canada, Australia and New Zealand, where its focus most of its efforts on products in the dermatology and neurology therapeutic classes. Valeant also has branded generic, branded, and OTC operations in Europe.

Guru Action: Over eight quarters of double-digit and triple-digit gains, Wallace Weitz has averaged a gain of 131% buying 2,102,460 shares at an average price of $46.70 per share. Selling, he gained 15% on 59,625 shares at an average price of $93.76 per share.

Aon Plc (AON)

Weightings: 5.4%

Current Shares: 1,919,920

Value: $142,919,000

Up 46% over 12 months, Aon Plc provides risk management and human capital consulting services, workforce productivity solutions and insurance and reinsurance. Aon Plc has a market cap of $24.84 billion; its shares were traded at around $82.75 with a P/E ratio of 24.70 and P/S ratio of 3.30. The dividend yield of Aon Plc stocks is 0.80%. Aon had an annual average earnings growth of 24.20% over the past 10 years. GuruFocus currently ranks Aon Plc with one star out of five stars for business predictability.

Guru Action: Over another remarkable trading history of gains, Wallace Weitz has averaged a gain of 103% buying 2,454,635 shares at an average price of $40.73 per share. Selling, he gained 50% on 534,715 shares at an average price of $54.96 per share.

Berkshire Hathaway Inc. (BRK.B)

Weightings: 4.8%

Current Shares: 1,115,992

Value: $126,676,000

Up 34% over 12 months, Berkshire Hathaway Inc. has a market cap of $272.66 billion; its shares were traded at around $116.66 with a P/E ratio of 14.30 and P/S ratio of 1.30. Berkshire Hathaway Inc. had an annual average earnings growth of 6.90% over the past 10 years. GuruFocus rated Berkshire Hathaway Inc. the business predictability rank of 2.5-star.

Guru Action: Over five years of gains, Wallace Weitz has averaged a gain of 65% buying 924,107 shares at an average price of $69.70 per share. Selling, he gained 50% on 3,297,215 shares at an average price of $76.75 per share.

In the third quarter of 2013, Weitz took his first loss in the holding history. He lost 0.3% buying 12,800 shares at an average price of $115.36 per share.

Directv (DTV), Weightings: 4.5%

Current Shares: 1,980,620

Value: $118,342,000

Up 32% over 12 months, Directv is a provider of digital television entertainment in the United States and Latin America. The company has a market cap of $34.85 billion; its shares were traded at around $66.44 with a P/E ratio of 12.80 and P/S ratio of 1.20. Directv had an annual average earnings growth of 29.40% over the past 5 years.

Guru Action: Over nine quarters of gains, Wallace Weitz has averaged a gain of 30% buying 2,225,900 shares at an average price of $51.09 per share. Selling, he gained 8% on 245,280 shares at an average price of $61.57 per share.

Here is the complete portfolio of Wallace Weitz.



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: 5.0/5 (1 vote)

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