Our best-performing sectors for the second quarter were energy and information technology, and from these sectors, Apache and Intel (INTC) were the Fund’s two strongest individual contributors.
Intel shares were also strong following their announcement of better than expected PC sales and profit margins, which should lead to higher earnings for the year. Despite lingering PC concerns and substantial investments in the ramp-up of their tablet PC offerings, Intel is still producing profit margins that are near the high end of their historical range.
Even with strong recent gains for Apache and Intel, the two stocks still sell at a significant discount to our estimate of intrinsic value.
From Bill Nygren (Trades, Portfolio)'s Second Quarter 2014 Shareholder Letter.
