1. How to use GuruFocus - Tutorials
  2. What Is in the GuruFocus Premium Membership?
  3. A DIY Guide on How to Invest Using Guru Strategies

New Guru Added: Donald Smith; Top Holdings: DDS, TSO, JBLU, AUY, CNA, PNW

November 07, 2010 | About:
Donald Smith has been added into our List of Gurus. This is a review of his investing philosophy and top holdings (DDS, TSO, JBLU, AUY, CNA, PNW).

Donald G. Smith is the CIO of Donald Smith & Co. He began his career as an analyst with Capital Research Company and subsequently worked at Capital Guardian Trust Co. In 1980, Donald be-came the CIO of Home Insurance Company, and President of Home Port-folio Advisors, Inc., which he bought in 1983 and changed the name to Donald Smith & Co., Inc.

In 2010, Donald Smith & Co. has $3.6 billion under management. Over 30 years since inception compounded annualized return has been 15.3%. Over the last 10 years our annualized return is 12.1% versus -0.4% for the S&P 500.

Mr. Smith was awarded a B.S. in Finance and Ac-counting by the University of Illinois, an MBA by Harvard University and a J.D. from UCLA Law School and was admitted to the Bar Association of California. He volunteered for Ben Graham in UCLA to conduct a study on low P/E strategy.

Donald Smith is a deep-value manager employing a strict bottom-up approach. He invests in stocks of out-of-favor companies selling at discounts to tangible book value. He looks for companies in the bottom docile of price-to-tangible book ratios and a positive outlook for earnings potential over the next 2-4 years.

Read the Graham and Doddsville newsletter Fall 2010 for the interview with Donald Smith. These are his top holdings as of 6/30/2010. His Q3 portfolio will be updated in 1-2 weeks.

No. 1: Dillard's Inc. (NYSE:DDS), Weightings: 5.49% - 6,609,664 Shares

Dillard's Inc. is one of the nation's largest fashion apparel and home furnishings retailers. Dillard's Inc. has a market cap of $1.82 billion; its shares were traded at around $28.46 with a P/E ratio of 16 and P/S ratio of 0.3. The dividend yield of Dillard's Inc. stocks is 0.6%.

No. 2: Tesoro Corp. (NYSE:TSO), Weightings: 5.34% - 11,834,323 Shares

Tesoro was founded in 1968 as a company primarily engaged in petroleum exploration and production. Tesoro Corp. has a market cap of $2.01 billion; its shares were traded at around $14.17 with and P/S ratio of 0.1. Tesoro Corp. had an annual average earning growth of 11.8% over the past 10 years.

No. 3: JetBlue Airways Corp. (NASDAQ:JBLU), Weightings: 4.75% - 22,384,931 Shares

JetBlue Airways is a low-fare, low-cost passenger airline, which provides high-quality customer service primarily on point-to-point routes and is based in New York's John F. Jetblue Airways Corp. has a market cap of $2.14 billion; its shares were traded at around $7.54 with a P/E ratio of 23.6 and P/S ratio of 0.6. Jetblue Airways Corp. had an annual average earning growth of 6.3% over the past 10 years.

No. 4: Yamana Gold Inc. (NYSE:AUY), Weightings: 4.35% - 10,927,008 Shares

Yamana Gold is a Canadian gold producer with significant gold production, gold and copper-gold development stage properties, exploration properties and land positions in all major mineral areas in Brazil. Yamana Gold Inc. has a market cap of $8.6 billion; its shares were traded at around $11.71 with a P/E ratio of 23.8 and P/S ratio of 7.2. The dividend yield of Yamana Gold Inc. stocks is 0.8%. Yamana Gold Inc. had an annual average earning growth of 105.9% over the past 5 years.

No. 5: CNA Financial Corp. (NYSE:CNA), Weightings: 4.23% - 4,281,597 Shares

CNA Financial Corporation is an insurance holding company whose primary subsidiaries consist of property/casualty and life insurance companies. Cna Financial Corp. has a market cap of $7.71 billion; its shares were traded at around $28.48 with a P/E ratio of 8.2 and P/S ratio of 0.9.

No. 6: Pinnacle West Capital Corp. (NYSE:PNW), Weightings: 3.93% - 2,797,073 Shares

Pinnacle West Capital is engaged, through its subsidiaries, in the generation, transmission, and distribution of electricity and selling energy, products and services; in real estate development; and in venture capital investment. Pinnacle West Capital Corp. has a market cap of $4.6 billion; its shares were traded at around $42.14 with a P/E ratio of 15.7 and P/S ratio of 1.4. The dividend yield of Pinnacle West Capital Corp. stocks is 4.9%.

About the author:

Charlie Tian, Ph.D. - Founder of GuruFocus. You can now order his book Invest Like a Guru on Amazon.

Rating: 2.3/5 (9 votes)


Please leave your comment:

GuruFocus has detected 2 Warning Signs with Dillard's Inc $DDS.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.

Performances of the stocks mentioned by gurufocus

User Generated Screeners

markus.t.isenrich5yr Dividend Growers
markus.t.isenrich10yr BV-,EPS- and Rev growth
psycliqual divd 2
NeteaFast growth 2
ow416-23-17 Growth
victorwt2017 v3
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)

GF Chat