Jeff Ubben (Trades, Portfolio), CEO and chief investment officer of ValueAct Holding LP, has been a director of Twenty-First Century Fox Inc. Class B (FOX, Financial) since November 2015. On Oct. 3, the guru purchased 3 million shares at $26.06 per share, according to the company’s Form 4 filing with the Securities and Exchange Commission. The insider transaction cost $78.18 million.
Fox’s institutional and insider ownership is 22.31% and 0.04%, respectively. As of June 30, Ubben and Donald Yacktman (Trades, Portfolio) own 47,326,334 and 27,975,629 respective shares of the entertainment company. Yacktman, who has the third largest stake in Fox, also owns over 40 million shares of FOX Class A stock.
Despite having a modest financial strength rank of 5, Fox has a profitability rank of 8, implying high growth potential. The company has a high Greenblatt return on capital, strong returns on equity, and its operating margin is near a 10-year high. Additionally, Fox’s price-to-book and price-to-sales ratios are currently near a three-year low, and its return on invested capital outperforms its WACC.
While the company is slightly overvalued based on its Peter Lynch chart, Fox is undervalued based on its median P/S value and Peter Lynch value. The former valuation method assumes that the stock valuations revert to the historical mean P/S value while the latter assumes that the PEG equals one for fair-valued companies.
See also
You can view the latest guru picks under the “Gurus” tab. Premium members can access the real-time picks of gurus, insider cluster buys, guru+insider double buys and triple buys to get real-time investing ideas. The premium plus membership gives access to over 4000+ guru’s portfolios and institutional 13F filings. Please review the membership benefits and sign-up for a free seven-day trial.
Disclosure: The author has no position in the stocks mentioned in the article.
