Generation Asset Management, the firm founded by David Blood and Al Gore (Trades, Portfolio), disclosed this month that its top five trades in the second quarter included increased bets in Becton, Dickinson and Co. (BDX, Financial), Palo Alto Networks Inc. (PANW, Financial) and Varian Medical Systems Inc. (VAR, Financial), and position reductions in Charles Schwab Corp. (SCHW, Financial) and MercadoLibre Inc. (MELI, Financial).
The former Vice President of the United States co-founded the London-based firm in 2004, seeking long-term capital appreciation through fundamental analysis and bottom-up stock picking. Generation focuses on sustainability within markets with companies that strategically manage their economic, social and environmental performances.
As of the quarter-end, Generation's $17.34 billion equity portfolio contains 39 stocks, with no new positions and a turnover ratio of 8%. The top three sectors in terms of weight include technology, health care and communication services, with weights of 35.72%, 32.70% and 8.54%.
Becton, Dickinson and Co.
Generation purchased 866,019 shares of Becton, Dickinson and Co., increasing the position 50.5% and its equity portfolio 1.19%. Shares averaged $246.67 during the second quarter.
The Franklin Lakes, New Jersey-based company produces a wide range of medical instruments and supplies, including surgical needles and syringes. GuruFocus ranks the company's profitability 9 out of 10 on several positive investing signs, which include a three-star business predictability rank, a Piotroski F-score of 7 and an operating margin that is outperforming 67.36% of global competitors.
Palo Alto Networks
Generation purchased 840,746 shares of Palo Alto Networks, increasing the position 33.64% and its equity portfolio 1.11%. Shares averaged $210.57 during the second quarter.
The Santa Clara, California-based company develops and sells a wide range of cybersecurity products, including firewall appliances, endpoint protection, cybersecurity and cloud security analytics. According to GuruFocus, the company's debt ratios are underperforming over 90% of global competitors, suggesting low financial strength.
Varian
Generation purchased 1,470,328 shares of Varian, increasing the position 81.83% and its equity portfolio 1.04%. Shares averaged $115.56 during the second quarter.
The Palo Alto, California-based company designs, manufactures and sells radiation technology for oncology systems and proton therapy. GuruFocus ranks Varian's profitability 8 out of 10 on the back of returns outperforming over 80% of global competitors.
Charles Schwab
Generation sold 5,857,870 shares of Charles Schwab, reducing the stake 18.08% and its equity portfolio 1.40%. Shares averaged $35.75 during the second quarter.
GuruFocus ranks the San Francisco-based brokerage company's financial strength 4 out of 10 on the heels of debt-to-equity and equity-to-asset ratios underperforming over 70% of global capital market competitors.
MercadoLibre
Generation sold 306,510 shares of MercadoLibre, reducing the holding 46.29% and the equity portfolio 1.06%. Shares averaged $744.07 during the second quarter.
GuruFocus ranks the Argentine retail company's financial strength 6 out of 10: Although the company has a strong Altman Z-score of 12 and a cash-to-debt ratio that outperforms 78.31% of global competitors, MercadoLibre has a weak Piotroski F-score of 3 and a debt-to-Ebitda ratio that underperforms over 86% of global competitors.
Disclosure: No positions.
Read more here:
- Ken Heebner's CGM Reveals Top Trades for 2nd Quarter
- Top 5 Buys of Philippe Laffont's Coatue Management in the 2nd Quarter
- Daniel Loeb's Top 6 Trades in the 2nd Quarter
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