NEW SOUTH CAPITAL MANAGEMENT INC Buys 3, Sells 2 in 2nd Quarter

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Aug 13, 2022
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NEW SOUTH CAPITAL MANAGEMENT INC recently filed their 13F report for the second quarter of 2022, which ended on 2022-06-30.

The 13F report details which stocks were in a guru’s equity portfolio at the end of the quarter, though investors should note that these filings are limited in scope, containing only a snapshot of long positions in U.S.-listed stocks and American depository receipts as of the quarter’s end. They are not required to include international holdings, short positions or other types of investments. Still, even this limited filing can provide valuable information.

New South Capital Management Inc. is an investment management firm based out of Memphis, Tennessee. The company was established in 1985 by cofounders Paul Trowbridge Gillespie Jr. and D. Stephen Morrow, both of whom are still with the company today acting as its President and CIO, respectively. The company has remained relatively small since its inception and has 11 employees of which 9 are investment professionals. New South Capital Management has a value oriented investment philosophy, focusing on identifying companies that are undervalued. The company conducts its research internally, utilizing a fundamental methodology that strives to produce “superior, risk-adjusted returns on both an absolute and relative basis.” New South Capital Management invests most heavily in the consumer discretionary sector, which alone makes up over a third of its total asset allocations, and also invests in the information technology, finance, industrials, real estate, and health care sectors, among others to a lesser degree, in order of decreasing allocation. The company’s top holdings include Zebra Technologies Corp., Jarden Corp., Gannett Co., MSC Industrial Direct Inc., and Howard Hughes Corp. New South Capital Management’s top 10 holdings together make up over a third of its total asset allocations and the company has a turnover rate of approximately 9%. The company currently holds approximately $4.4 billion in total assets under management spread across 277 accounts, all of which are discretionary. Both of the New South Capital Management’s total number of accounts and total assets under management have been increasing in recent years with its total managed assets growing significantly from $860 million back in 2010 to over five times that amount today. The company mainly caters to high net worth individuals, which alone makes up over a third of its total asset allocations, and also caters to a variety of other clientele. New South Capital Management offers its Small Cap Value, SMID Cap Value, Mid Cap Value, and Value Opportunity strategies.

As of the latest 13F report, the guru’s equity portfolio contained 62 stocks valued at a total of $2.19Bil. The top holdings were AZO(7.46%), ZBRA(6.25%), and TMO(4.80%).

According to GuruFocus data, these were NEW SOUTH CAPITAL MANAGEMENT INC’s top five trades of the quarter.

Warner Bros.Discovery Inc


During the quarter, NEW SOUTH CAPITAL MANAGEMENT INC bought 1,021,690 shares of NAS:WBD for a total holding of 3,797,100. The trade had a 0.63% impact on the equity portfolio. During the quarter, the stock traded for an average price of $18.65.

On 08/13/2022, Warner Bros.Discovery Inc traded for a price of $13.68 per share and a market cap of $33.21Bil. The stock has returned -52.66% over the past year.

GuruFocus gives the company a financial strength rating of 5 out of 10 and a profitability rating of 9 out of 10.

In terms of valuation, Warner Bros.Discovery Inc has a price-book ratio of 0.64, a EV-to-Ebitda ratio of 8.24 and a price-sales ratio of 0.73.

The price-to-GF Value ratio is 0.47, earning the stock a GF Value rank of 2.

Frontdoor Inc


During the quarter, NEW SOUTH CAPITAL MANAGEMENT INC bought 236,111 shares of NAS:FTDR for a total holding of 2,133,035. The trade had a 0.26% impact on the equity portfolio. During the quarter, the stock traded for an average price of $27.05.

On 08/13/2022, Frontdoor Inc traded for a price of $26.05 per share and a market cap of $2.12Bil. The stock has returned -40.36% over the past year.

GuruFocus gives the company a financial strength rating of 5 out of 10 and a profitability rating of 8 out of 10.

In terms of valuation, Frontdoor Inc has a price-earnings ratio of 19.14, a price-book ratio of 359.89, a price-earnings-to-growth (PEG) ratio of 6.60, a EV-to-Ebitda ratio of 11.76 and a price-sales ratio of 1.35.

The price-to-GF Value ratio is 0.49, earning the stock a GF Value rank of 4.

Hanesbrands Inc


During the quarter, NEW SOUTH CAPITAL MANAGEMENT INC bought 475,491 shares of NYSE:HBI for a total holding of 3,914,887. The trade had a 0.22% impact on the equity portfolio. During the quarter, the stock traded for an average price of $12.46.

On 08/13/2022, Hanesbrands Inc traded for a price of $10.57 per share and a market cap of $3.69Bil. The stock has returned -46.71% over the past year.

GuruFocus gives the company a financial strength rating of 5 out of 10 and a profitability rating of 8 out of 10.

In terms of valuation, Hanesbrands Inc has a price-earnings ratio of 8.09, a price-book ratio of 4.72, a EV-to-Ebitda ratio of 8.62 and a price-sales ratio of 0.55.

The price-to-GF Value ratio is 0.64, earning the stock a GF Value rank of 8.

Zebra Technologies Corp


NEW SOUTH CAPITAL MANAGEMENT INC reduced their investment in NAS:ZBRA by 7,653 shares. The trade had a 0.12% impact on the equity portfolio. During the quarter, the stock traded for an average price of $349.24.

On 08/13/2022, Zebra Technologies Corp traded for a price of $346.74 per share and a market cap of $17.96Bil. The stock has returned -39.00% over the past year.

GuruFocus gives the company a financial strength rating of 6 out of 10 and a profitability rating of 8 out of 10.

In terms of valuation, Zebra Technologies Corp has a price-earnings ratio of 37.71, a price-book ratio of 7.18, a price-earnings-to-growth (PEG) ratio of 1.85, a EV-to-Ebitda ratio of 18.15 and a price-sales ratio of 3.18.

The price-to-GF Value ratio is 0.87, earning the stock a GF Value rank of 9.

AutoZone Inc


NEW SOUTH CAPITAL MANAGEMENT INC reduced their investment in NYSE:AZO by 1,120 shares. The trade had a 0.09% impact on the equity portfolio. During the quarter, the stock traded for an average price of $2056.43.

On 08/13/2022, AutoZone Inc traded for a price of $2259.18 per share and a market cap of $44.03Bil. The stock has returned 38.56% over the past year.

GuruFocus gives the company a financial strength rating of 4 out of 10 and a profitability rating of 10 out of 10.

In terms of valuation, AutoZone Inc has a price-earnings ratio of 20.04, a price-earnings-to-growth (PEG) ratio of 1.45, a EV-to-Ebitda ratio of 14.45 and a price-sales ratio of 3.02.

The price-to-GF Value ratio is 1.17, earning the stock a GF Value rank of 3.


Please note, the numbers and facts quoted are as of the writing of this article and may not factor in the latest trading data or company announcements.

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