At the end of the last year, two investment managers, Bruce Berkowitz and Donald Yacktman were among managers being nominated as the best Money Manager of the Decade by MorningStar. Yacktman’s fund returned 11.97% and Berkowitz’s fund returned 13.02% per year for the past ten years at the time.
Both Bruce Berkowitz and Donald Yacktman have generated far above the market and great absolute returns for the shareholders of their funds over the past decade. They also demonstrated strong performance in both the down market and the up market. For the 10-year period ended Jan. 31, 2010, Bruce Berkowitz’s Fairholme Fund gained 268% cumulatively. In 2008, when a lot of value invested suffered losses that wiped out their gains of many years, Fairholme Fund outperformed the market by 7.3%, and when the market dramatically turned around in 2009. Fairholme Fund gained 39%, outperformed the market again, by 12.5%. Over the past decade, Fairholme Fund only underperformed in one year, the year of 2003. For his consistent performance and confidence in handling the market risks, Bruce Berkowitz was voted the Investment Guru of the Year in 2009 by GuruFocus users.
Yacktman has also achieved great performances with his Yacktman Fund. For the 10-year period ended on Dec. 31, 2009, his fund generated a cumulative return of more than 208%. He had two down years over the past decade, down 1.3% in 2005 and 26% in 2008. 2008 was a year of testing the investment risks of portfolio managers. The Yacktman Fund was down a manageable 26% of loss, bettering the market by 11%, then he seized the tremendous opportunities of bargains in 2009, made an astonishing gain of 59%. There aren’t many funds that can do better in both the down and the up market, and make a meaningful gain in the last two years.
The excellent performances of Berkowitz and Yacktman are the results of their investment philosophies, the risk management and their long term belief of investing in good business. We have written detailed reviews of their investment strategies. You can see it here:
The two managers have much in common. Berkowitz focuses on free cash flow and Yacktman selects stocks based on forward expected return based on free cash yield.
But recently, the two seem to go different ways. In the recent quarter, Berkowtiz bought a host of financial stocks and Yacktman continued to buy into high quality stocks, a theme he has been following for the past couple of quarters. GuruFocus has followed their story here and here.
Still, there are a number of stocks showing up in the portfolio of both managers and they are:
AmeriCredit Corp. (ACF, Financial)
AmeriCredit Corp. is a independent automobile finance company that provides financing solutions indirectly through auto dealers and directly to consumers in the United States and Canada. Americredit Corp. has a market cap of $3.16 billion; its shares were traded at around $23.59 with a P/E ratio of 19.5 and P/S ratio of 1.6.
Bruce Berkowitz owns 35,349,099 shares as of 12/31/2009, which accounts for 6.75% of the $9.97 billion portfolio of Fairholme Capital Management. Donald Yacktman owns 4,007,385 shares as of 03/31/2010, which accounts for 2.93% of the $3.26 billion portfolio of Yacktman Asset Management Co..
Comcast Corp. (CMCSK, Financial)
Comcast Corporation is principally involved in the development, management and operation of broadband cable networks, and in the provision of electronic commerce and programming content. Comcast Corp. Special has a market cap of $55.18 billion; its shares were traded at around $18.91 with and P/S ratio of 1.6. The dividend yield of Comcast Corp. Special stocks is 2%. Comcast Corp. Special had an annual average earning growth of 14.6% over the past 10 years.
Bruce Berkowitz bought 14,520,900 shares in the quarter that ended on 12/31/2009. Donald Yacktman owns 8,474,704 shares as of 03/31/2010, an increase of 21.06% from the previous quarter.
Bank of America Corp. (BAC, Financial)
Bank of America Corp. is one of the world's financial services companies. Bank Of America Corp. has a market cap of $152.06 billion; its shares were traded at around $17.56 with and P/S ratio of 1. The dividend yield of Bank Of America Corp. stocks is 0.2%.
Berkowitz bought more than 35 million shares in the quarter ended on February, 2010 and Donald Yacktman owns 466,500 shares as of 03/31/2010.
Berkshire Hathaway Inc. (BRK-A)
Berkshire Hathaway Inc. is a holding company owning subsidiaries engaged in a number of diverse business activities. Berkshire Hathaway Inc. has a market cap of $189.08 billion; its shares were traded at around $114800 with a P/E ratio of 22.1 and P/S ratio of 1.7. Berkshire Hathaway Inc. had an annual average earning growth of 18.2% over the past 10 years. GuruFocus rated Berkshire Hathaway Inc. the business predictability rank of 2-star.
Donald Yacktman owns 152 shares as of 03/31/2010, Bruce Berkowitz owns 3,925 shares as of 12/31/2009, an increase of 77.28% from the previous quarter. The two also own Class B shares of Berkshire Hathaway stocks too.
Leucadia National Corp. (LUK, Financial)
LEUCADIA NATL is a diversified financial services holding companyprincipally engaged in personal and commercial lines of property and casualty insurance, life insurance, banking and lending and manufacturing. Leucadia National Corp. has a market cap of $6.05 billion; its shares were traded at around $24.85 with a P/E ratio of 11.8 and P/S ratio of 5.4.
Bruce Berkowitz owns 20,247,644 shares as of 12/31/2009, and Donald Yacktman owns 116,700 shares as of 03/31/2010.
Conclusion
Despite similarity in investment approach, recently, Bruce Berkowtiz and Donald Yacktman bought different stocks. Yet, in their portfolio, there are still plenty stocks in common.
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Both Bruce Berkowitz and Donald Yacktman have generated far above the market and great absolute returns for the shareholders of their funds over the past decade. They also demonstrated strong performance in both the down market and the up market. For the 10-year period ended Jan. 31, 2010, Bruce Berkowitz’s Fairholme Fund gained 268% cumulatively. In 2008, when a lot of value invested suffered losses that wiped out their gains of many years, Fairholme Fund outperformed the market by 7.3%, and when the market dramatically turned around in 2009. Fairholme Fund gained 39%, outperformed the market again, by 12.5%. Over the past decade, Fairholme Fund only underperformed in one year, the year of 2003. For his consistent performance and confidence in handling the market risks, Bruce Berkowitz was voted the Investment Guru of the Year in 2009 by GuruFocus users.
Yacktman has also achieved great performances with his Yacktman Fund. For the 10-year period ended on Dec. 31, 2009, his fund generated a cumulative return of more than 208%. He had two down years over the past decade, down 1.3% in 2005 and 26% in 2008. 2008 was a year of testing the investment risks of portfolio managers. The Yacktman Fund was down a manageable 26% of loss, bettering the market by 11%, then he seized the tremendous opportunities of bargains in 2009, made an astonishing gain of 59%. There aren’t many funds that can do better in both the down and the up market, and make a meaningful gain in the last two years.
The excellent performances of Berkowitz and Yacktman are the results of their investment philosophies, the risk management and their long term belief of investing in good business. We have written detailed reviews of their investment strategies. You can see it here:
The two managers have much in common. Berkowitz focuses on free cash flow and Yacktman selects stocks based on forward expected return based on free cash yield.
But recently, the two seem to go different ways. In the recent quarter, Berkowtiz bought a host of financial stocks and Yacktman continued to buy into high quality stocks, a theme he has been following for the past couple of quarters. GuruFocus has followed their story here and here.
Still, there are a number of stocks showing up in the portfolio of both managers and they are:
| Symbol | Company | # of Guru Buys Last Quarter | # of Guru Sells Last Quarter | P/E | Yield (%) |
|---|---|---|---|---|---|
| ACF | AmeriCredit Corp. | 0 | 2 | 19.5 | 0 |
| CMCSK | Comcast Corp. Special | 2 | 0 | 2 | |
| BAC | Bank of America Corp. | 1 | 1 | 0.2 | |
| BRK-A | Berkshire Hathaway Inc. | 0 | 1 | 22.1 | 0 |
| BRK-B | Berkshire Hathaway Inc. | 0 | 1 | 22.2 | 0 |
| LUK | Leucadia National Corp. | 0 | 0 | 11.8 | 0 |
AmeriCredit Corp. (ACF, Financial)
AmeriCredit Corp. is a independent automobile finance company that provides financing solutions indirectly through auto dealers and directly to consumers in the United States and Canada. Americredit Corp. has a market cap of $3.16 billion; its shares were traded at around $23.59 with a P/E ratio of 19.5 and P/S ratio of 1.6.
Bruce Berkowitz owns 35,349,099 shares as of 12/31/2009, which accounts for 6.75% of the $9.97 billion portfolio of Fairholme Capital Management. Donald Yacktman owns 4,007,385 shares as of 03/31/2010, which accounts for 2.93% of the $3.26 billion portfolio of Yacktman Asset Management Co..
Comcast Corp. (CMCSK, Financial)
Comcast Corporation is principally involved in the development, management and operation of broadband cable networks, and in the provision of electronic commerce and programming content. Comcast Corp. Special has a market cap of $55.18 billion; its shares were traded at around $18.91 with and P/S ratio of 1.6. The dividend yield of Comcast Corp. Special stocks is 2%. Comcast Corp. Special had an annual average earning growth of 14.6% over the past 10 years.
Bruce Berkowitz bought 14,520,900 shares in the quarter that ended on 12/31/2009. Donald Yacktman owns 8,474,704 shares as of 03/31/2010, an increase of 21.06% from the previous quarter.
Bank of America Corp. (BAC, Financial)
Bank of America Corp. is one of the world's financial services companies. Bank Of America Corp. has a market cap of $152.06 billion; its shares were traded at around $17.56 with and P/S ratio of 1. The dividend yield of Bank Of America Corp. stocks is 0.2%.
Berkowitz bought more than 35 million shares in the quarter ended on February, 2010 and Donald Yacktman owns 466,500 shares as of 03/31/2010.
Berkshire Hathaway Inc. (BRK-A)
Berkshire Hathaway Inc. is a holding company owning subsidiaries engaged in a number of diverse business activities. Berkshire Hathaway Inc. has a market cap of $189.08 billion; its shares were traded at around $114800 with a P/E ratio of 22.1 and P/S ratio of 1.7. Berkshire Hathaway Inc. had an annual average earning growth of 18.2% over the past 10 years. GuruFocus rated Berkshire Hathaway Inc. the business predictability rank of 2-star.
Donald Yacktman owns 152 shares as of 03/31/2010, Bruce Berkowitz owns 3,925 shares as of 12/31/2009, an increase of 77.28% from the previous quarter. The two also own Class B shares of Berkshire Hathaway stocks too.
Leucadia National Corp. (LUK, Financial)
LEUCADIA NATL is a diversified financial services holding companyprincipally engaged in personal and commercial lines of property and casualty insurance, life insurance, banking and lending and manufacturing. Leucadia National Corp. has a market cap of $6.05 billion; its shares were traded at around $24.85 with a P/E ratio of 11.8 and P/S ratio of 5.4.
Bruce Berkowitz owns 20,247,644 shares as of 12/31/2009, and Donald Yacktman owns 116,700 shares as of 03/31/2010.
Conclusion
Despite similarity in investment approach, recently, Bruce Berkowtiz and Donald Yacktman bought different stocks. Yet, in their portfolio, there are still plenty stocks in common.
GuruFocus provides real time information and insights of Investment Gurus such as Warren Buffett and Bruce Berkowitz, and Donald Yacktman for Premium Members. If you are not a premium member, click here to sign up or upgrade. 7-Day Free Trial is available.
