While many of the gurus featured on GuruFocus are investors who trade mainly in U.S. equities, GuruFocus also follows many international fund managers who may be of interest to those looking at British, Canadian or Asian stocks.
To see what international stocks gurus are buying, hover over the “Guru” tab on the top menu, then select “International Picks.” This feature also allows you to narrow down by country and transaction type.
The following stocks are five of the British stocks that gurus purchased during the fourth quarter.
GlaxoSmithKline (LSE:GSK, Financial)
During the fourth quarter, Causeway International Value (Trades, Portfolio) and Spanish fund Bestinfond (Trades, Portfolio) added GlaxoSmithKline’s British stock to their fund’s portfolio. Causeway, led by Sarah Ketterer (Trades, Portfolio), purchased 5,269,224 shares, which had a 1.8% portfolio weighting. Bestinfond (Trades, Portfolio) purchased 668,556 shares for a 1% portfolio weighting.
GlaxoSmithKline manufactures and markets vaccines, over-the-counter medicines and other health-related consumer products. Its areas of focus include respiratory, anti-virals, oncology, dermatology and rare diseases.
Over the past year, the shares have not seen any fluctuation with a share price change of zero over the time period. It currently trades at £16.16 with a P/E ratio of 28.8 and P/S ratio of 3.42.
In Q4 2014, the company reported net income of £1,033 million, less than half of the income of £2,461 million from the year-ago quarter. For a long-term perspective, the graph below shows the income trend over time.
The operating margin has also been in decline since FY 2011, recording at 15.64% in FY 2014.
Antofagasta (LSE:ANTO, Financial)
Charles de Vaulx (Trades, Portfolio) and IVA International Fund (Trades, Portfolio) both purchased Antofagasta in the fourth quarter. IVA bought 1,912,614 shares, which accounts for 1.1% of the portfolio, while Charles de Vaulx (Trades, Portfolio) bought 3,655,194 shares for a 0.81% portfolio weighting.
Antofagasta is based in Chile and is engaged in copper mining, exploration and development. Its three business divisions are mining, water concession, and railway and other transport services.
The stock price has declined 11% over the past year and currently trades at £7.27 with a P/E ratio of 17.5 and P/S ratio of 1.81.
GuruFocus rates the company’s business predictability as 2.5 out of 5 stars. The DCF model, which relies on earnings predictability, projects a fair value of £6.13 giving a -19% margin of safety.
The operating margin has been struggling since 2010, and preliminary data for FY 2014 estimate a margin of 30.92%, the lowest point over the past 10 years.
Bestinfond (Trades, Portfolio) was the only guru to add WPP as a new holding during the fourth quarter. The fund purchased 637,405 shares at an average price of £12.59, with a 0.93% portfolio weighting.
WPP is a communications services organization that serves national and multinational clients. Its four reportable segments are Advertising and Media Investment Management, Consumer Insight, Public Relations and Public Affairs, as well as Healthcare and Specialist Communications.
The stock has been up 31% over the past year and currently trades at £15.73 with a P/E ratio of 22.7 and P/S ratio of 1.91.
The company’s business predictability is rates as 3 out of 5 stars, according to revenue and earnings consistency. The DCF model projects a fair value of £14.34, giving a -10% margin of safety.
Preliminary data for FY 2014 predict EBIT per share will be £1.13, up from £1.04 in 2013. The following graph shows the earnings trend over time.
Provident Financial (LSE:PFG, Financial)
The Wintergreen Fund (Trades, Portfolio) purchased 278,820 shares of Provident Financial during the fourth quarter at an average price of £22.20 per share. The stock now accounts for 0.82% of the portfolio.
Provident Financial provides nonstandard credit for clients. One of its products is the Vanquis credit card, which has smaller credit limits to allow customers to build their credit profile with options for flexibility.
The stock price has increased 45% over the past year and currently trades at £28.17 with a P/E ratio of 22.2 and P/S ratio of 3.67.
In the semi-annual report for the second half of the year, the company reported net income of £105 million, a marked improvement from the £86 million in the year-ago half. The graph below shows annual earnings data.
Imperial Tobacco Group (LSE:IMT, Financial)
Bestinfond (Trades, Portfolio) added Imperial Tobacco Group to the portfolio with 262,245 shares at an average price of £31.85. The stock has a 0.81% portfolio weighting.
The British tobacco company is present in numerous markets. Its key growth markets, or places where market share is less than 15%, include the U.S., Italy, Vietnam and Sweden. Key return markets, or countries where market share is more than 15%, include the U.K., France and Germany.
The stock has increased 31% over the past year and now trades at £31.85. GuruFocus rates the business predictability as 3.5 out of 5 stars. The DCF model gives a fair value of £14.32, suggesting a -122% margin of safety.
Semiannual data in 2014 show the second half of the year reported net income of £1,056 million, much higher than the second half of 2013, when net income was £294 million. The graph below shows the annual income trend.
The current P/E ratio is 21, while the P/S ratio is 1.14.
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