Douglas C. Lane's Largest Consumer Discretionary Plays Have Rocketed in Q1

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May 06, 2015

Douglas C. Lane & Associates is a registered investment advisory firm based in New York City. It manages approximately $4 billion of capital of high net worth families, trusts, pensions, endowments, foundations and institutions.

It disclosed an equity portfolio valued at $3.81 billion as of the end of the first quarter of 2015. The equity portfolio is mainly invested in Technology (21%), Consumer Discretionary (17%) and Health Care (16%) stocks. Douglas C. Lane’s last 13F filing showed that the fund raised its exposure towards consumer discretionary and energy stocks, but reduced its holdings in the consumer staples sector.

In this article we will look into the top three consumer discretionary picks held at the end of the first quarter. These companies are Harman International Industries, Incorporated (HAR, Financial), General Motors Company (GM, Financial) and BorgWarner Inc. (BWA, Financial).

Harman International Industries (HAR, Financial) represents the first most valuable investment, in which it held 564,105 shares, down by 1% on the quarter; the value of the stake amounts to a market value of $75.38 million. We must highlight that the stock gained about 25.23% during the first quarter of 2015.

The firm develops, manufactures, and markets audio products, lighting solutions, and electronic systems, as well as digitally integrated audio and infotainment systems for the automotive industry worldwide. The company posted fiscal third quarter earnings of $1.22 per share, missing forecasts. Revenue increased by 4.6% to $1.46 billion from the same quarter last year.

The largest shareholder of the company was Frontier Capital Management Company, LLC, with 1.02 million shares valued at $136.17 million, as of the end of March 2015.

In second place we found General Motors Company (GM). The fund held about 2 million shares valued at $75.07 million at the end of the first quarter of 2015. With a market cap of $56.27 billion, General Motors is up only by 7.42% during the quarter. General Motors has posted smaller-than-expected profit. Among the reasons for this, we can found the poor performance in South America and Russia. On the other hand, other regions like China, the rest of Asia, the Middle East and Africa, performed well in the quarter.

The past month, David Einhorn (Trades, Portfolio)'s Greenlight Capital, a value-oriented investment advisor, has taken a new stake in General Motors, according to its latest investor letter.

Next in line is BorgWarner Inc. (BWA, Financial). The fund held about 1.14 million shares valued at $69.11 million at the end of the first quarter of 2015. With a market cap of $13.7 billion, the company is up by 10.06% during the quarter. The leading supplier of highly engineered components and systems operates in a highly competitive industry, where logical cyclical demands could hurt cash flows and the sustainability of the businesses. But, if the global vehicle production continues increasing, favoring the company, it is expected to increase sales in the upcoming future.

Sarasin & Partners LLP, which is a London-based asset management group, held 4.97 million shares valued at $300.39 million at the end of the quarter.

Disclosure: As of this writing, Omar Venerio did not hold a position in any of the aforementioned stocks