Richard Pzena (Trades, Portfolio), in his 10 largest trades of the second quarter, added to a few stakes but reduced more with technology and energy stocks among his leading transactions.
The founder and co-chief investment officer of Pzena Investment Management made his largest transaction of the quarter in Seagate Technology PLC (STX, Financial), a California-based computer storage company. The guru boosted the stake by more than 58% with the purchase of 5,696,037 shares for an average price of $24.4 per share. The deal had a 0.87% impact on the portfolio.
The stake, now 15,500,305 shares, is 5.19% of Seagate’s outstanding shares and 2.36% of the guru’s total assets. The stake is the largest among the gurus.
Seagate has a price-earnings (P/E) ratio of 44.48, a forward P/E of 13.39, a price-book (P/B) ratio of 6.88 and a price-sales (P/S) ratio of 1.00. GuruFocus gives Seagate a Financial Strength rating of 5/10 and a Profitability and Growth rating of 6/10 with return on equity (ROE) of 12.35% that is higher than 75% of the companies in the Global Data Storage industry and return on assets (ROA) of 2.80% that is lower than 51% of the companies in that industry.
Seagate sold for $36.46 per share at market close Friday. The DCF Calculator gives Seagate a fair value of $8.78.
The guru also added to the stake in Voya Financial Inc. (VOYA, Financial), a New York-based financial services company. The guru raised the stake by more than 31% with the acquisition of 3,612,038 shares for an average price of $30.58 per share. The transaction had a 0.58% impact on the portfolio.
The stake, now 15,175,429 shares, is 7.58% of Voya’s outstanding shares and 2.35% of the guru’s total assets. It is the largest stake among the gurus.
Voya has a P/E of 19.87, a forward P/E of 7.43, a P/B of 0.39 and a P/S of 0.57. GuruFocus gives Voya a Financial Strength rating of 5/10 and a Profitability and Growth rating of 5/10 with ROE of 1.98% that is lower than 52% of the companies in the Global Asset Management industry and ROA of 0.13% that is lower than 62% of the companies in that industry.
Voya sold for $28.83 per share Friday. The DCF Calculator gives Voya a fair value of $15.52.
The guru nearly doubled the stake in Terex Corp. (TEX, Financial), a Connecticut-based maker of lifting and material handling solutions, acquiring 2,359,735 shares for an average price of $22.9 per share. The deal had a 0.3% impact on the portfolio.
The stake, now 7,164,504 shares, is 6.6% of Terex’s outstanding shares and 0.91% of the guru’s total assets. Pzena's Terex stake is also the largest among the gurus.
Terex has a P/E of 47.04, a forward P/E of 17.64, a P/B of 1.34 and a P/S of 0.45. GuruFocus gives Terex a Financial Strength rating of 5/10 and a Profitability and Growth rating of 6/10 with ROE of 2.90% that is lower than 59% of the companies in the Global Farm & Construction Equipment industry and ROA of 0.94% that is lower than 63% of the companies in that industry.
Terex sold for $23.04 per share Friday. The DCF Calculator gives Terex a fair value of $9.2.
Half a dozen of Pzena’s largest transactions during the quarter were position reductions.
The most noteworthy was the sale of 1,077,887 shares of Royal Dutch Shell PLC (RDS.A, Financial), an oil and gas company with offices in The Hague and London, for an average price of $50.84 per share. The transaction had a -0.32% impact on the portfolio.
The remaining stake of 8,941,688 shares is 0.22% of Royal Dutch Shell’s outstanding shares and 3.09% of the guru’s total assets. Dodge & Cox is Royal Dutch Shell’s leading shareholder among the gurus with a stake of 10,459,227 shares. The stake is 0.26% of the company’s outstanding shares and 0.57% of Dodge & Cox’s total assets.
Royal Dutch Shell has a forward P/E of 12.89, a P/B of 1.10 and a P/S of 0.78. GuruFocus gives Royal Dutch Shell a Financial Strength rating of 5/10 and a Profitability and Growth rating of 3/10 with ROE of -2.54% that is lower than 62% of the companies in the Global Oil & Gas Integrated industry and ROA of -1.20% that is lower than 63% of the companies in that industry.
Royal Dutch Shell sold for $47.97 per share Friday. The DCF Calculator gives Royal Dutch Shell a fair value of $-17.12.
The guru trimmed the position in Apache Corp. (APA, Financial), a Houston-based petroleum and natural gas company, by nearly 49% with the sale of 886,499 shares for an average price of $54.29 per share. The deal had a -0.26% impact on the portfolio.
The remaining position of 932,140 shares is 0.25% of Apache’s outstanding shares and 0.32% of the guru’s total assets. Apache’s leading shareholder among the gurus is Dodge & Cox with a stake of 29,097,064 shares. The stake is 7.67% of Apache’s outstanding shares and 1.6% of Dodge & Cox’s total assets.
Apache has a forward P/E of 53.19, a P/B of 3.19 and a P/S of 4.41. GuruFocus gives Apache a Financial Strength rating of 3/10 and a Profitability and Growth rating of 3/10 with ROE of -183.41% that is lower than 89% of the companies in the Global Oil & Gas E&P industry and ROA of -54.85% that is lower than 81% of the companies in that industry.
Apache sold for $60.02 per share Friday. The DCF Calculator gives Apache a fair value of $-387.61.
The guru trimmed the stake in Murphy Oil (MUR, Financial), a petroleum and natural gas company based in Arkansas, by more than 15%, selling 1,625,662 shares for an average price of $30.16 per share. The transaction had a -0.25% impact on the portfolio.
The remaining stake of 9,186,692 shares is 5.33% of Murphy’s outstanding shares and 1.82% of the guru’s total assets. HOTCHKIS & WILEY is Murphy’s leading shareholder among the gurus with a stake of 10,274,372 shares. The stake is 5.97% of Murphy’s outstanding shares and 1.4% of HOTCHKIS & WILEY’s total assets.
Murphy has a forward P/E of 250.00, a P/B of 0.97 and a P/S of 2.13. GuruFocus gives Murphy a Financial Strength rating of 4/10 and a Profitability and Growth rating of 3/10 with ROE of -40.21% that is lower than 61% of the companies in the Global Oil & Gas E&P industry and ROA of -19.61% that is lower than 56% of the companies in that industry.
Murphy sold for $26.08 per share Friday. The DCF Calculator gives Murphy a fair value of $-147.15.
The guru reduced the stake in Baxter International Inc. (BAX, Financial), a medical equipment company based in Illinois, by almost 24% with the sale of 968,541 shares for an average price of $43.82 per share. The deal had a -0.24% impact on the portfolio.
The remaining stake of 3,115,865 shares is 0.57% of Baxter’s outstanding shares and 0.88% of the guru’s total assets. Daniel Loeb (Trades, Portfolio) is Baxter’s leading shareholder among the gurus with a stake of 51,901,767 shares. The stake is 9.54% of Baxter’s outstanding shares and 22.37% of Loeb’s total assets.
Baxter has a P/E of 5.44, a forward P/E of 24.33, a P/B of 2.98 and a P/S of 2.63. GuruFocus gives Baxter a Financial Strength rating of 7/10 and a Profitability and Growth rating of 5/10 with ROE of 56.87% and ROA of 22.96% that are higher than 97% of the companies in the Global Medical Instruments & Supplies industry.
Baxter sold for $47.49 per share Friday. The DCF Calculator gives Baxter a fair value of $92.59 with a 49% margin of safety.
The guru sold nearly 17% of the stake in Microsoft (MSFT, Financial), a technology company based in Redmond, Washington. The guru sold 681,563 shares for an average price of $52.01 per share in a transaction that had a -0.23% impact on the portfolio.
The remaining stake of 3,423,007 shares is 0.04% of Microsoft’s outstanding shares and 1.1% of the guru’s total assets. PRIMECAP Management (Trades, Portfolio) is Microsoft’s leading shareholder among the gurus with a stake of 58,516,633 shares. The stake is 0.75% of Microsoft’s outstanding shares and 3.19% of the guru’s total assets.
Microsoft has a P/E of 27.87, a forward P/E of 19.61, a P/B of 6.24 and a P/S of 5.44. GuruFocus gives Microsoft a Financial Strength rating of 6/10 and a Profitability and Growth rating of 7/10 with ROE of 21.64% that is higher than 85% of the companies in the Global Software – Infrastructure industry and ROA of 9.13% that is higher than 78% of the companies in that industry.
Microsoft sold for $57.43 per share Friday. The DCF Calculator gives Microsoft a fair value of $22.05.
The guru sold nearly 8% of the stake in Oracle Corp. (ORCL, Financial), a California-based computer technology company. The guru sold 824,061 shares for an average price of $39.95 per share. The deal had a -0.21% impact on the portfolio.
The remaining stake of 9,587,982 shares is 0.23% of Oracle’s outstanding shares and 2.46% of the guru’s total assets. First Eagle Investment (Trades, Portfolio) is Oracle’s leading shareholder among the gurus with a stake of 40,498,196 shares. The stake is 0.99% of Oracle’s outstanding shares and 4.22% of First Eagle’s total assets.
Oracle has a P/E of 18.95, a forward P/E of 14.86, a P/B of 3.36 and a P/S of 4.58. GuruFocus gives Oracle a Financial Strength rating of 6/10 and a Profitability and Growth rating of 7/10 with ROE of 19.20% that is higher than 82% of the companies in the Global Software – Infrastructure industry and ROA of 8.07% that is higher than 75% of the companies in that industry.
Oracle sold for $39.23 per share Friday. The DCF Calculator gives Oracle a fair value of $39.14.
Disclosure: I do not own any stocks mentioned in this article.
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