David Rolfe

David Rolfe

Last Update: 08-15-2016

Number of Stocks: 35
Number of New Stocks: 3

Total Value: $4,935 Mil
Q/Q Turnover: 5%

Countries: USA
Details: Top Buys | Top Sales | Top Holdings  Embed:

David Rolfe' s Profile & Performance

Profile

David Rolfe has been managing Wedgewood's portfolio for 18 years. He studied at University of Missouri and received a degree of B.S.B.A. in Finance/Economics in 1984.

Web Page:http://wedgewoodpartners.com/

Investing Philosophy

Wedgewood's underlying equity investment philosophy is predicated on a strong belief that significant long-term wealth will be created by investing as "owners" in companies. In our "Invest as Business Owners" approach, we seek companies that the following characteristics:

1. A dominant product or service that is practically irreplaceable or lacks substitutes.
2. A sustainable and consistent level of growing revenues, earnings and dividends.
3. A high level of profitability, measured by return on equity without the use of excessive debt.
4. A strong management team that is shareholder oriented.

This is the flow chart of their process:

Total Holding History

Performance of Wedgewood Partners

YearReturn (%)S&P500 (%)Excess Gain (%)
201329.8632.39-2.5
201221.75165.8
20115.612.113.5
3-Year Cumulative67 (18.6%/year)56.8 (16.2%/year)10.2 (2.4%/year)
201014.515.06-0.6
200960.8326.4634.4
5-Year Cumulative207.5 (25.2%/year)128.2 (17.9%/year)79.3 (7.3%/year)
2008-38.12-37-1.1
200715.045.499.6
2006-2.7715.79-18.6
20055.844.910.9
20049.6110.88-1.3
10-Year Cumulative146.9 (9.5%/year)104.2 (7.4%/year)42.7 (2.1%/year)
200342.2528.6813.6
2002-20.42-22.11.7
2001-7.72-11.894.2
2000-10.31-9.1-1.2
199956.9921.0436.0
15-Year Cumulative263.2 (9%/year)98.5 (4.7%/year)164.7 (4.3%/year)
199849.628.5821.0
199721.133.36-12.3
199623.5722.960.6
199542.5937.585.0
19943.781.322.5
20-Year Cumulative1103.1 (13.2%/year)483.4 (9.2%/year)619.7 (4%/year)
1993-6.2110.08-16.3

Top Ranked Articles

David Rolfe Takes 2 in Growing Retail Industry Strong sector offers good investing opportunities
David Rolfe (Trades, Portfolio), chief investment officer of Wedgewood Partners Inc., increases value to his shareholders using an “index investing” approach. Read more...
David Rolfe Comments on Kraft Heinz Company Guru stock highlight
Kraft Heinz Company (NASDAQ:KHC) was a top performer during the quarter. First quarter adjusted EBITDA grew 21% year over year and earnings per share grew 38% year over year, as the Company’s consolidated adjusted EBITDA margins reached 30%, up a staggering 600 basis points from the year ago period. We estimate that these margins are best-in-class for the large-cap food products sub -industry, and nearly twice the median. In our view, the vast majority of large capitalization food product competitors, despite possessing great brands, are improperly incentivized, and are content to generate revenues at the expense of profits and long-term shareholder returns. In contrast, we continue to be impressed by Kraft Heinz’s new management culture, as recently brought to bear by 3G Capital and Berkshire Hathaway, which aggressively aligns management and employee incentives with shareholders. For example, rather than simply cutting overhead costs, the Company is intently focused on eliminating financial promotions for retailers (that frequently resulted in profitless revenues) Read more...
David Rolfe Comments on Express Scripts Guru stock highlight
Express Scripts (NASDAQ:ESRX) was a top contributor during the quarter. The stock recovered some of the poor performance from the first quarter after Anthem management noted that, despite filing a lawsuit over Express Scripts’s pricing, they believed any ruling on the lawsuit would take several years and were still open to negotiations. Express Scripts is the sole, independent pharmacy benefits manager (PBM), which we think is key for maintaining their alignment with customers. We continue to expect Express Scripts to drive mid-to-high single-digit EBITDA growth using its scale to negotiate better pricing with drug manufacturers and service providers, while increasing patient adherence. We think earnings per share can continue to grow at a double-digit rate as shares are repurchased at what, in our view, are attractive valuations. That said, as shares rallied from their previous lows, we reduced the stock's weighting to better reflect the risk/reward of Express Scripts’s growth and valuation. Read more...
David Rolfe Comments on Schlumberger Guru stock highlight
Schlumberger (NYSE:SLB) contributed .42% to composite performance during the quarter. Despite the dramatic decline in exploration and production (E&P) capex budgets during the past 18 months, Schlumberger continues to reinforce its competitive positioning relative to other integrated oil service companies. With one of the largest, most highly-skilled upstream workforces in the private sector, and nearly $7 billion in cumulative research and development spent during the previous up-cycle, we think Schlumberger is poised to take an increased budget share of E&P spending as the Company’s customers outsource more services to improve returns in a “lower-for-longer” oil price environment. We expect Schlumberger’s earnings to significantly rebound in 2017, driven by increased market share as well as the release of over two years of pent-up E&P spending. Read more...
» More David Rolfe Articles

Commentaries and Stories

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

David Rolfe Takes 2 in Growing Retail Industry Strong sector offers good investing opportunities David Rolfe - David Rolfe Takes 2 In Growing Retail Industry
David Rolfe (Trades, Portfolio), chief investment officer of Wedgewood Partners Inc., increases value to his shareholders using an “index investing” approach. More...

DAVID ROLFE


  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

David Rolfe Comments on Perrigo Guru stock highlight
During the quarter, a surprising decline in Perrigo (NYSE:PRGO)’s normally staid generic prescription (Rx) business had the Company reduce full-year guidance by almost 15% in a late-April pre-earnings release. In addition, the Company disclosed further write-downs and organizational changes in their nascent Branded Consumer Health (BCH) segment. Last, the Company announced the abrupt exit of long-time CEO, Joe Papa, who joined embattled Valeant Pharmaceutical. Immediately after this slew of disconcerting data points, we decided it prudent to liquidate our Perrigo stake. More...

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

David Rolfe Comments on Ross Stores Guru stock highlight
We also purchased shares of Ross Stores (NASDAQ:ROST) during the quarter. Ross is the other uniquely profitable off-price retailer, with nearly 1500 locations in 34 US states. Like TJX, we think Ross’s value chain is tailored to deliver a “more for less” value proposition for its customers. However, unlike TJX, Ross skews to a much more moderate income buyer who is looking to find “value” more than fashion. We find evidence that Ross’s catering to this demographic requires substantially different investment and operational activities. For instance, nearly half of Ross’s inventory is “packaway” inventory, which is typically more fashion-oriented merchandise that was purchased from vendors and kept in storage, to be deployed to store floors at a later date (sometimes the following season, but rarely more than a year). In the meantime, the “flow” that makes up most of Ross’s turnover consists of less well-known fashion brands but at price points that still represent great value relative to full-price retailers. In contrast, we do not think TJX has a meaningful packaway strategy, instead tailoring their merchandise More...

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

David Rolfe Comments on Apple Guru stock highlight
Apple (NASDAQ:AAPL) has been a significant underperformer not only during the recent second quarter (-11.8%), but also for nearly a year now. The stock has fallen about - 28% on an absolute basis, from its high set back on July 20, 2015. This is the second time that the stock has been put through the wringer since late 2012 on fears of “peak” iPhone growth and the concomitant lack of innovation out of the skunk works in Cupertino. Given the surge of sales of the iPhone 6 in 2015 (pent up demand for a larger iPhone, plus significant demand from China), we are not surprised by the weaker year-over-year earnings comparisons. More...

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

David Rolfe Comments on Stericycle Guru stock highlight
Stericycle (NASDAQ:SRCL) was also a top detractor during the second quarter. Stericycle’s early-year bounce reversed itself and then some after management lowered forward earnings expectations for the second time in three quarters. Management noted further weakness in their small (~3% of revenues, we estimate), industrial hazardous waste business, and pushed the timeline of about $20 million of expected synergies from their newly acquired document destruction business into next year. Taken alone, we think the stock’s -21% reaction following the earnings release was an overreaction. More...

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

David Rolfe Comments on Perrigo Guru stock highlight
Perrigo (NYSE:PRGO) detracted –1.04% from the composite's absolute performance. A surprising decline in Perrigo’s normally staid generic prescription (Rx) business had the company reduce full-year guidance by almost 15% in a late April pre-earnings release. In addition, the Company disclosed further write-downs and organizational changes in their nascent Branded Consumer Health (BCH) segment. Last, the Company announced the abrupt exit of long-time CEO, Joe Papa, who joined embattled Valeant Pharmaceutical. Immediately after this slew of data points, we decided it prudent to liquidate our Perrigo stake. More...

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

David Rolfe Comments on Schlumberger Guru stock highlight
Schlumberger (NYSE:SLB) contributed .42% to composite performance during the quarter. Despite the dramatic decline in exploration and production (E&P) capex budgets during the past 18 months, Schlumberger continues to reinforce its competitive positioning relative to other integrated oil service companies. With one of the largest, most highly-skilled upstream workforces in the private sector, and nearly $7 billion in cumulative research and development spent during the previous up-cycle, we think Schlumberger is poised to take an increased budget share of E&P spending as the Company’s customers outsource more services to improve returns in a “lower-for-longer” oil price environment. We expect Schlumberger’s earnings to significantly rebound in 2017, driven by increased market share as well as the release of over two years of pent-up E&P spending. More...

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

David Rolfe Comments on Express Scripts Guru stock highlight
Express Scripts (NASDAQ:ESRX) was a top contributor during the quarter. The stock recovered some of the poor performance from the first quarter after Anthem management noted that, despite filing a lawsuit over Express Scripts’s pricing, they believed any ruling on the lawsuit would take several years and were still open to negotiations. Express Scripts is the sole, independent pharmacy benefits manager (PBM), which we think is key for maintaining their alignment with customers. We continue to expect Express Scripts to drive mid-to-high single-digit EBITDA growth using its scale to negotiate better pricing with drug manufacturers and service providers, while increasing patient adherence. We think earnings per share can continue to grow at a double-digit rate as shares are repurchased at what, in our view, are attractive valuations. That said, as shares rallied from their previous lows, we reduced the stock's weighting to better reflect the risk/reward of Express Scripts’s growth and valuation. More...

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

David Rolfe Comments on Kraft Heinz Company Guru stock highlight
Kraft Heinz Company (NASDAQ:KHC) was a top performer during the quarter. First quarter adjusted EBITDA grew 21% year over year and earnings per share grew 38% year over year, as the Company’s consolidated adjusted EBITDA margins reached 30%, up a staggering 600 basis points from the year ago period. We estimate that these margins are best-in-class for the large-cap food products sub -industry, and nearly twice the median. In our view, the vast majority of large capitalization food product competitors, despite possessing great brands, are improperly incentivized, and are content to generate revenues at the expense of profits and long-term shareholder returns. In contrast, we continue to be impressed by Kraft Heinz’s new management culture, as recently brought to bear by 3G Capital and Berkshire Hathaway, which aggressively aligns management and employee incentives with shareholders. For example, rather than simply cutting overhead costs, the Company is intently focused on eliminating financial promotions for retailers (that frequently resulted in profitless revenues) More...

  • Currently 4.50/5

Rating: 4.5/5 (2 votes)

David Rolfe's Wedgewood Partners 2nd Quarter 2016 Client Letter Brexit: The Vote Heard ‘Round the World, discussion of outlook and holdings David Rolfe - David Rolfe's Wedgewood Partners 2nd Quarter 2016 Client Letter
"I think a lot of the market reaction is less about the financial impact and more about populism and what it means for the liberal economic order. The Brexit vote reflects a deep distrust of the benefits of the global economic system among a wide swath of voters in Europe and the United States, and a broadly held view that government institutions – whether in Washington or Brussels – are calcifying and don't work well. Both of these forces have a lot of wind at their back." More...

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

David Rolfe Nearly Divests Stake in M&T Bank Guru invests in Charles Schwab David Rolfe - David Rolfe Nearly Divests Stake In M&T Bank
Technology and Financial Services are the two most heavily weighted sectors in the portfolio of David Rolfe (Trades, Portfolio) of Wedgewood Partners Inc., and the guru was active in both in the first quarter. More...

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

Tom Gayner Sells Out of Coach A decrease in international revenue and multiple warning signs may have influenced guru Tom Gayner,David Rolfe - Tom Gayner Sells Out Of Coach
Guru Tom Gayner (Trades, Portfolio), CEO of Markel (NYSE:MKL), sold his 54,000-share stake in Coach Inc. (NYSE:COH) in the first quarter. More...

  • Currently 4.87/5

Rating: 4.9/5 (15 votes)

David Rolfe's Lengthy Analysis of Berkshire Hathaway Berkshire Hathaway is Wedgewood Partners' largest holding David Rolfe - David Rolfe's Lengthy Analysis Of Berkshire Hathaway
Berkshire Hathaway (NYSE:BRK.A)(NYSE:BRK.B)"We want to do business in times of pessimism, not because we like pessimism but because we like the prices it produces. It's optimism that’s the enemy of the rational buyer. We do not measure the progress of our investments by what their market prices do during any given year. Rather, we evaluate their performance by the two methods we apply to the businesses we own. The first test is improvement in earnings, with our making due allowance for industry conditions. The second test is whether their moats (competitive advantages) have widened during the year."Warren Buffett (Trades, Portfolio)We have owned shares of Berkshire Hathaway nearly continuously since the end of December More...

  • Currently 5.00/5

Rating: 5.0/5 (1 vote)

David Rolfe Comments on Charles Schwab Guru stock highlight
Charles Schwab (NYSE:SCHW) More...

  • Currently 5.00/5

Rating: 5.0/5 (1 vote)

David Rolfe Comments on M&T Bank Guru stock highlight
M&T Bank (NYSE:MTB)Our growth thesis for M&T Bank was predicated on the company’s ability to maintain its historically successful inorganic growth strategy. We purchased the stock in mid-2013 as the Company moved forward with it’s acquisition of Hudson City Bank (announced in August 2012). More than three years later, after extensive AML/BSA expenses (the company spent over $150 million to improve these systems in 2014 alone) and four extensions to the closure date, regulatory approval was finally granted and the acquisition was complete. Of note in the Fed’s approval, however, was a restriction stipulating that M&T Bank must fully integrate the Hudson City deal and cure all BSA deficiencies fully before pursuing further growth through acquisition. We fully expect the Company to follow through on the Fed’s requirements, but given how cumbersome and expensive it has been to integrate this acquisition, we are not convinced that future acquisitions will be any less cumbersome. Furthermore, we are concerned that More...

  • Currently 5.00/5

Rating: 5.0/5 (1 vote)

David Rolfe Comments on Perrigo Guru stock highlight
Perrigo (NYSE:PRGO)Perrigo was a bottom performance contributor in the quarter, as the company reported a miss in its Branded Consumer Healthcare (BCH) segment. Management attributed the miss to execution issues and dedicated themselves to solving these problems over the coming quarters. We are willing to be patient; in the meantime, as we think that Perrigo’s core, private label OTC business is unique and should remain a healthy and sustainable source of internal capital.Perrigo’s BCH segment was established after closing on the acquisition of Omega Pharma (Belgium) in March 2015. Mylan’s hostile bid for Perrigo was launched a few weeks later, and did not conclude until mid-November. We think that Perrigo’s BCH execution issues are understandable (if not predictable), as management was admittedly distracted by fending off Mylan’s hostile bid for the Company during much of 2015. Over the next several quarters, we expect BCH to post improved results, as it is better More...

  • Currently 5.00/5

Rating: 5.0/5 (1 vote)

David Rolfe Comments on LKQ Corp Guru stock highlight
LKQ Corp (NASDAQ:LKQ)During the quarter, LKQ continued to execute on its mid-single digit organic growth plus M&A strategy. In addition, the Company provided a convincing case for its continued execution at their first-ever Investor Day. The Company also announced the acquisition of Pittsburgh Glass Works for $635 million in enterprise value and finalized the acquisition of the RHIAG group of Italy.LKQ is both the largest distributor of aftermarket collision parts in North America and the largest distributor of mechanical aftermarket parts in Europe. We think scale is critically important to most distribution businesses, and LKQ is no exception. In North America, LKQ’s primary customers are collision repair shops that often participate in volume programs organized by casualty insurers looking for low-cost but high-quality repair parts. These collision repair shops must turn their repair jobs over relatively quickly or risk losing out on volume business. As such, LKQ’s unmatched product availability and fulfillment More...

  • Currently 5.00/5

Rating: 5.0/5 (3 votes)

David Rolfe's Wedgewood Partners 1st Quarter 2016 Client Letter Letter includes a lengthy discussion of Berkshire Hathaway David Rolfe - David Rolfe's Wedgewood Partners 1st Quarter 2016 Client Letter
Review and Outlook More...

  • Currently 0.00/5

Rating: 0.0/5 (0 votes)

Jana Partners Trims Qualcomm Holding by 67% Event-driven firm's top trades in 4th quarter Ken Fisher, David Rolfe, Jana Partners - Jana Partners Trims Qualcomm Holding By 67%
Jana Partners LLC is an investment manager specializing in event-driven investing and was founded in 2001 by Barry Rosenstein, Jana’s managing partner and co-portfolio manager. Jana typically applies a fundamental value discipline to identify undervalued companies that have one or more specific catalysts to unlock value. More...

Add Notes, Comments

If you want to ask a question or report a bug, please create a support ticket.

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)
FEEDBACK