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Top Five Consumer Cyclical Stocks of the Third Quarter

December 24, 2013 | About:
Monica Wolfe

Monica Wolfe

127 followers

Using the GuruFocus Aggregated Portfolio Screener you can filter results to see what companies maintain the highest amount of guru ownership. By using this screener, we filtered down to see which consumer cyclical companies are held by the most gurus. As of the third quarter, the following five companies are held by the largest number of gurus.

Lowe’s Companies (LOW)

The most-held consumer cyclical company is Lowe’s Companies with 27 guru shareholders. During the past quarter there were 12 gurus making buys and 14 gurus makings sells of their stake in LOW. These gurus hold on to a combined weighting of 14.16%.

The top guru shareholders of Lowe’s Companies:

  1. Andreas Halvorsen: 17,382,222 shares, representing 1.62% of the company’s shares outstanding.
  2. Pioneer Investments: 2,828,598 shares, representing 0.26% of the company’s shares outstanding.
  3. Hotchkis & Wiley: 2,614,501 shares, representing 0.24% of the company’s shares outstanding.

Lowe’s is a holding company for Lowe’s stores which are home improvement retailers. The company serves homeowners, renters and commercial business customers and offers a product portfolio which consists of paint, tools, wood, do-it-yourself products, hardware, home products, etc.

Lowe’s historical revenue and earnings growth:

1387912106982.png

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

The company recently announced its third quarter sales and earnings results which reported:

  • Comparable sales increased 6.2%.
  • Diluted EPS increased 34.3% to $0.47 per share.
  • Net earnings increased 18.6% to $1.98 billion for the nine month period.
  • Sales for the quarter increased 7.3% to $13.0 billion.
  • Repurchased $$761 million of stock and paid $191 million in dividends.

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

1387912135964.png

Lowes has a market cap of $50.89 billion. Its shares are currently trading at around $48.66 with a P/E ratio of 23.10, a P/S ratio of 1.00 and a P/B ratio of 4.10. The company had an annual average earnings growth of 4.30% over the past ten years.

GuruFocus rated the company the business predictability rank of 2-star.

Twenty-First Century Fox (FOXA)

The second most held guru cyclical stock is in Twenty-First Century Fox. There are 26 guru shareholders with 18 of those making buys along with six gurus making sells of their stock in the company. These gurus hold a combined weighting of 68.69%.

The top guru owners of Twenty-First Century Fox:

  1. Donald Yacktman: 70,753,947 shares, representing 3.06% of the company’s shares outstanding.
  2. Dodge & Cox: 48,471,166 shares, representing 2.1% of the company’s shares outstanding.
  3. Yacktman Fund: 31,400,000 shares, representing 1.36% of the company’s shares outstanding.

Twenty- First Century Fox is a diversified media and entertainment company. Its segments include Cable Network Programming, Television, Filmed Entertainment and Direct Broadcast Satellite Television.

Twenty-First Century’s historical revenue and net income:

1387913170758.png

The analysis on Twenty-First Century Fox reports that the company’s revenue has been in decline over the past five years, its dividend yield is near a 5-yearh low and its price is at a 10-year high.

The company reported its first quarter results which highlighted:

  • Revenue increased 18% to $7.06 billion.
  • OIBDA of $1.62 billion, up from $1.59 billion last year.
  • Income from continuing operations of $768 million, or $0.33 per share.
  • Adjusted earnings per share of $0.33, down from $0.38 per share.

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

1387913126239.png

Twenty-First Century Fox has a market cap of $79 billion. Its shares are currently trading at around $34.62 with a P/E ratio of 13.10, a P/S ratio of 2.80 and a P/B ratio of 4.60.

General Motors (GM)

The third most guru-held consumer cyclical stock of the third quarter is in General Motors. Over the past quarter there were 26 guru owners with 11 gurus making buys and 12 gurus making sells of their stake in the company. These gurus hold a combined weighting of 34.02%.

The top guru shareholders of General Motors:

  1. Warren Buffett: 40,000,000 shares, representing 2.89% of the company’s shares outstanding.
  2. David Einhorn: 17,047,339 shares, representing 1.23% of the company’s shares outstanding.
  3. NWQ Managers: 9,102,725 shares, representing 0.66% of the company’s shares outstanding.

General Motors Company designs, builds and sell cars, trucks and automobile parts. The company also provides automotive financing services through General Motors Financial Company Inc.

General Motors’ historical revenue and net income:

1387908263355.png

The analysis on GM reports that the company’s revenue has been in decline over the past five years, it has issued $5.4 billion of debt over the past three years and its price is sitting near a 5-year high.

General Motors has a market cap of $57.35 billion. Its shares are currently trading at around $41.29 with a P/E ratio of 13.30, a P/S ratio of 0.45 and a P/B ratio of 2.00.

Walt Disney (DIS)

The fourth most held consumer cyclical stock is in Walt Disney with 26 guru owners. There were 12 gurus making buys along with 15 guru sells over the past quarter. These gurus hold on to a combined weighting of 23.62%.

The top guru shareholders of Walt Disney:

  1. PRIMECAP Management: 9,118,399 shares, representing 0.51% of the company’s shares outstanding.
  2. Ken Fisher: 8,348,328 shares, representing 0.47% of the company’s shares outstanding.
  3. Andreas Halvorsen: 6,642,265 shares, representing 0.37% of the company’s shares outstanding.

The company together with its subsidiaries is a worldwide entertainment company with operations in five business segments: Media Networks, Parks and Resorts, Studio Entertainment, Consumer Products and Interactive Media.

Walt Disney’s historical revenue and net income:

1387916555750.png

The analysis on Disney reports that the company’s price is at a 10-year high, its Piotroski F-Score is very high and it has shown predictable revenue and earnings growth. The analysis also notes that over the past three years the company has issued $2.5 billion of debt, but that its debt level is acceptable, and that the company’s operating margin is expanding.

The company recently announced that it increased its annual cash dividend by 15% to $0.86 per share. This dividend represents the 58th consecutive dividend payment to shareholders.

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

1387916576923.png

Walt Disney has a market cap of $129.7 billion. Its shares are currently trading at around $73.81 with a P/E ratio of 21.80, a P/S ratio of 3.00 and a P/B ratio of 2.90. The company holds a 1.20% dividend yield, and has seen an annual average earnings growth of 10.30% over the past ten years.

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

Priceline.com (PCLN)

The fifth largest guru-held position goes to Priceline.com where there are currently 22 guru owners of the company. There were 12 gurus making buys and there were twelve gurus making sells of their stake in the company. These gurus hold a combined weighting of 42.93 %.

The top guru shareholders of Priceline:

  1. Frank Sands: 1,641,752 shares, representing 3.19% of the company’s shares outstanding.
  2. Steve Mandel: 969,568 shares, representing 1.88% of the company’s shares outstanding.
  3. Chase Coleman: 571,000 shares, representing 1.11% of the company’s shares outstanding.

Priceline is an online travel company that offers its customers a range of travel services, including hotel rooms, car rentals, airline tickets, vacation packages, cruises and destination services. The company also operates a retail, price-disclosed hotel reservation service in the U.S.

Priceline’s historical revenue and net income:

1387917308626.png

One of Priceline’s subsidiaries, Booking.com, recently announced a partnership with NYC & Company. Booking.com is the world’s largest accommodation booking site, and will work with NYC & Company to increase tourism and generate additional hotel bookings to New York City.

The analysis on Priceline.com reports that the price is at a 10-year high, its operating margin is expanding and the company’s P/S ratio is nearing a 10-year high.

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

1387917374380.png

Priceline.com has a market cap of $60.71 billion. Its shares are currently trading at around $1180.43 with a P/E ratio of 34.20, a P/S ratio of 9.60 and a P/B ratio of 9.10. The company had an annual average earnings growth of 52.3% over the past ten years.

You can check out other top held sectors of the market by using the Aggregated Screener here.

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