On July 31, 2023, Capital Research Global Investors (Trades, Portfolio), a Los Angeles-based investment firm, reduced its stake in PG&E Corp (PCG, Financial). This article provides an in-depth analysis of the transaction, the guru's profile, and the traded stock's performance.
Profile of Capital Research Global Investors (Trades, Portfolio)
Capital Research Global Investors (Trades, Portfolio) is a renowned investment firm located at 333 South Hope Street, Los Angeles, CA 90071. The firm's investment philosophy is centered on long-term growth and capital appreciation. As of the date of this article, the firm holds 423 stocks with a total equity of $350.26 billion. The firm's top holdings include Amazon.com Inc (AMZN, Financial), Broadcom Inc (AVGO, Financial), Microsoft Corp (MSFT, Financial), Abbott Laboratories (ABT, Financial), and General Electric Co (GE, Financial). The firm's portfolio is heavily concentrated in the Technology and Healthcare sectors.
Details of the Transaction
The transaction involved a reduction of 23,016,357 shares in PG&E Corp, representing a 15.48% change. The shares were traded at a price of $17.61 each. Following the transaction, Capital Research Global Investors (Trades, Portfolio) holds 125,696,103 shares in PG&E Corp, accounting for 0.63% of its portfolio and 4.90% of the company's total shares. The transaction had a -0.12% impact on the firm's portfolio.
Overview of PG&E Corp
PG&E Corp is a holding company whose main subsidiary, Pacific Gas and Electric, is a regulated utility operating in Central and Northern California. The company serves 5.3 million electricity customers and 4.6 million gas customers in 47 of the state's 58 counties. The company's segments include Electric and Natural gas. As of the date of this article, the company's market capitalization stands at $43.52 billion.
The company's stock is currently priced at $17.4, with a PE ratio of 19.12. However, according to GuruFocus's GF Valuation, the stock is significantly overvalued with a GF Value of $12.20. The stock's price to GF Value stands at 1.43. Since the transaction, the stock's price has decreased by 1.19%.
Evaluation of PG&E Corp's Performance
PG&E Corp has a GF Score of 52/100, indicating a poor future performance potential. The company's Financial Strength is ranked 3/10, while its Profitability Rank is 5/10. The company's Growth Rank is 1/10, indicating a weak growth potential. The company's Piotroski F-Score is 7, suggesting a healthy financial situation. However, the company's Altman Z score of 0.45 indicates a risk of financial distress. The company's interest coverage ratio is 0.89, indicating a low ability to cover interest expenses.
Comparison with Other Gurus
Other gurus who hold shares in PG&E Corp include Mario Gabelli (Trades, Portfolio) and Joel Greenblatt (Trades, Portfolio). The largest guru holding the traded stock is T Rowe Price Equity Income Fund (Trades, Portfolio).
In conclusion, Capital Research Global Investors (Trades, Portfolio)' recent transaction has reduced its exposure to PG&E Corp. Despite the company's weak growth potential and risk of financial distress, it still holds a significant position in the firm's portfolio. This transaction reflects the firm's dynamic investment strategy and its commitment to optimizing its portfolio performance.