GuruFocus Premium Membership

Serving Intelligent Investors since 2004. Only 96 cents a day.

Free Trial

Free 7-day Trial
All Articles and Columns »

Tweedy Browne Second Quarter Shareholder Letter

July 18, 2007
10qk

Buyout activity continued to buoy equity valuations during the quarter, both in the U.S. and abroad; however, debt originators began to face push back from investors who demanded more protection and better terms for the debt they were being offered.

The spread between junk bonds and treasury debt widened near the end of the quarter, which could dampen enthusiasm for a host of new debt offerings that are about to come to market. Should this trend continue, it could have significant ramifications for the pace of merger and acquisition activity, and ultimately for public equity market valuations.

Returns for the quarter were largely attributable to buyout activity in a number of our portfolio holdings and the residual impact of such activity on other companies in the portfolio; strong results in our Dutch holdings; unsustainably high returns in a number of our emerging market holdings; and continued solid results in our food, beverage, and financial holdings. Our pharmaceutical and other healthcare holdings, for the most part, performed poorly during the quarter, and our lack of energy exposure was once again a negative, as oil companies benefited from rising oil prices.

Read the complete letter


Rating: 3.6/5 (8 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK
Email Hide