Yacktman Asset Management (Trades, Portfolio), an investment firm based in Austin, Texas, disclosed this week that its top four buys during the fourth quarter of 2020 were in Charles Schwab Corp. (SCHW, Financial), Tyson Foods Inc. (TSN, Financial), Ingredion Inc. (INGR, Financial) and Unilever PLC (UL, Financial).
Led by Stephen Yacktman, the firm seeks long-term capital appreciation by investing in companies with at least one of three key criteria: good business, shareholder-oriented management and low purchase price. Yacktman looks for growth companies with good value.
As of December 2020, Yacktman's $8.09 billion equity portfolio contains 61 stocks, with three new positions and a turnover ratio of 6%. The firm's top four sectors in terms of weight include consumer defensive, communication services, financial services and technology, representing 27.45%, 21.14%, 14.98% and 14.08% of the equity portfolio.
Charles Schwab
The firm purchased 3,417,906 shares of Charles Schwab (SCHW, Financial), giving the shares 2.24% weight in the equity portfolio. Shares averaged $45.56 during the fourth quarter of 2020; the stock is fairly valued based on Tuesday's price-to-GF Value ratio of approximately 1.03.
The Westlake, Texas-based company offers a wide range of brokerage and banking services. GuruFocus ranks the company's profitability 6 out of 10: Charles Schwab has a 4.5-star business predictability rank and a net profit margin that outperforms over 70% of global competitors despite a return on assets that underperforms over 55% of global capital market companies.
Gurus with large holdings in Charles Schwab include Dodge & Cox, PRIMECAP Management (Trades, Portfolio) and Al Gore (Trades, Portfolio)'s Generation Asset Management.
Tyson Foods
The fund purchased 2,599,637 shares of Tyson Foods (TSN, Financial), giving the stake 2.07% weight in the equity portfolio. Shares averaged $62.34 during the fourth quarter of 2020; the stock is modestly undervalued based on Tuesday's price-to-GF Value ratio of 0.85.
The Springdale, Arkansas-based company produces a wide range of processed meat products through brands like Tyson, Jimmy Dean, Hillshire Farm and Sarah Lee. GuruFocus ranks the company's profitability 8 out of 10 on several positive investing signs, which include a four-star business predictability rank, expanding operating margins and returns that are outperforming over 72% of global competitors.
The Yacktman Fund (Trades, Portfolio) and Yacktman Focused Fund (Trades, Portfolio) also purchased shares of Tyson during the fourth quarter of 2020.
Ingredion
The firm purchased 1,504,903 shares of Ingredion (INGR, Financial), giving the shares 1.46% weight in the equity portfolio. Shares averaged $77.24 during the fourth quarter; the stock is modestly undervalued based on Tuesday's price-to-GF Value ratio of 0.82.
The Westchester, Illinois-based company manufactures ingredients for the food, beverage, paper and personal care industries. GuruFocus ranks the company's profitability 7 out of 10 on the back of profit margins and returns outperforming over 70% of global competitors.
Unilever
The firm purchased 242,614 shares of Unilever (UL, Financial), giving the position 0.18% weight in the equity portfolio. Shares averaged $60.27 during the fourth quarter of 2020; the stock is fairly valued based on Tuesday's price-to-GF Value ratio of 0.97.
The U.K.-based company manufactures a wide range of household and packaged-food products, including Dove soap and Hellmann's mayonnaise. GuruFocus ranks the company's profitability 8 out of 10 on several positive investing signs, which include a high Piotroski F-score of 7, a three-star business predictability rank and an operating margin that has increased approximately 5.8% per year over the past five years and is outperforming over 88% of global competitors.
Disclosure: No positions.
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