Bestinfond (Trades, Portfolio), which is part of Spanish investment firm Bestinver, recently disclosed its 13F portfolio updates for the fourth quarter of 2021, which ended on Dec. 31.
Managed by Beltran de la Lastra, the fund’s strategy seeks long-term capital appreciation through value opportunities in the markets, following in the footsteps of Benjamin Graham, Peter Lynch and Warren Buffett (Trades, Portfolio). It also utilizes the Austrian theory of economic cycles, which views cycles as a consequence of the artificial expansion of monetary supply and manipulation of interest rates by central banks or fractional reserve banks.
Based on its latest 13F filing, the fund’s most significant trades for the quarter were a reduction to its ING Groep NV (XAMS:INGA, Financial) holding, the sale of its Jeronimo Martins SGPS SA (XLIS:JMT, Financial) position, an addition to HelloFresh SE (XTER:HFG, Financial) and a new buy for Cognizant Technology Solutions Corp. (CTSH, Financial).
Investors should be aware that 13F reports do not provide a complete picture of a guru’s holdings. They include only a snapshot of long equity positions in U.S.-listed stocks and American Depository Receipts (ADRs) as of the quarter’s end. They do not include short positions, non-ADR international holdings or other types of securities. However, even this limited filing can provide valuable information.
ING Groep
The firm reduced its investment in ING Groep NV (XAMS:INGA, Financial) by 59.04%, leaving a remaining stake of 1,338,997 shares and trimming 1.44% off the equity portfolio. During the quarter, shares traded for an average price of 12.70 euros ($13.86).
ING Groep is a Dutch multinational banking and financial services company with headquarters in Amsterdam. It is engaged in retail, direct, commercial, investment and wholesale banking, as well as asset management and insurance services.
On March 11, shares of ING Groep traded around 9.01 euros for a market cap of 33.90 billion euros. According to the GF Value chart, the stock is significantly overvalued.
The company has a GuruFocus financial strength rating of 1 out of 10 and a profitability rating of 5 out of 10. The debt-to-Ebitda ratio of 11.7 and equity-to-asset ratio of 0.06 are lower than 92% of other companies in the banks industry. The return on equity of 9.40% is near the industry median, though the return on assets of 0.51% is half of the industry median.
Jeronimo Martins SGPS
The fund sold all 1,024,985 of its shares of Jeronimo Martins SGPS (XLIS:JMT, Financial), which previously took up 1.05% of the equity portfolio. Shares traded for an average price of 19.61 euros in the three months through the end of December.
Jeronimo Martins is a Portuguese retail company operating in the food distribution and specialized retail businesses. It has more than 4,200 stores in Portugal, Poland and Colombia, and the majority of its revenue comes from its food store chains.
On March 11, shares of Jeronimo Martins traded around 18.66 euros for a market cap of 11.72 billion euros. According to the GF Value chart, the stock is fairly valued.
The company has a GuruFocus financial strength rating of 8 out of 10 and a profitability rating of 10 out of 10. The Altman Z-Score of 3.36 and Piotroski F-Score of 6 out of 9 show a stable balance sheet. The return on invested capital has surpassed the weighted average cost of capital in recent years, meaning the company is creating value.
HelloFresh
The fund increased its HelloFresh SE (XTER:HFG, Financial) investment by 33.02% for a total of 879,834 shares, adding 0.91% to the equity portfolio. During the quarter, shares averaged 80.15 euros apiece.
Based in Berlin, HelloFresh is a meal-kit company that packages and delivers meal kits with ingredients and recipes to customers’ doors. It operates in Germany, the U.S., Australia, Canada, Denmark, New Zealand, Sweden and Western Europe.
On March 11, shares of HelloFresh traded around 37.40 euros for a market cap of 6.51 billion euros. The Peter Lynch chart shows the stock to be trading above its fair value but below its median historical valuation.
The cash-debt ratio of 1.81 and Altman Z-Score of 6.63 show a fortress-like balance sheet, though assets have been growing faster than revenue, which is a warning sign. The company has been steadily growing its top line, though its bottom-line growth has stalled.
Cognizant Technology Solutions Corp
Bestinfond (Trades, Portfolio) established a new holding worth 148,767 shares in Cognizant Technology Solutions Corp. (CTSH, Financial), giving it a weight of 0.71% in the equity portfolio at the quarter’s average price of $80.60 per share.
Cognizant is a New Jersey-based IT company that provides digital, technology, consulting and IT services to businesses. Specifically, it focuses on helping clients transform their businesses’ operating and technology models for the digital era.
On March 11, shares of Cognizant traded around $88.04 for a market cap of $46.18 billion. According to the GF Value chart, the stock is fairly valued.
The company has a GuruFocus financial strength rating of 9 out of 10 and a profitability rating of 10 out of 10. The Altman Z-Score of 7.46 and Piotroski F-Score of 9 out of 9 show a remarkably strong balance sheet. The company has a three-year revenue per share growth rate of 8.3% and a three-year Ebitda per share growth rate of 4.3%.
Portfolio overview
As of the latest 13F filing, the fund held shares in 66 common stocks valued at a total of $1.63 billion. The turnover for the quarter was 7%.
The top holdings were HelloFresh with 3.65% of the equity portfolio, GlaxoSmithKline PLC (LSE:GSK, Financial) with 3.52% and Samsung Electronics Co. Ltd. (XKRX:005930, Financial) with 3.5%.
In terms of sector weighting, the fund was most invested in consumer cyclical, industrials and basic materials.
