Howard Marks (Trades, Portfolio), co-chairman of the $90 billion Oaktree Capital Management (OAK, Financial), on June 16 purchased 1,278,080 shares of a new stock, Century Communities (CCS, Financial), according to GuruFocus Real Time Picks.
His new holding represents 5.9% of the company. Century Communities shares declined almost 24% since their initial public offering in June to close at $16.20 per share on Tuesday.
Marks is a risk-averse investor who does not emphasize market timing but does seek opportunities in inefficient markets. Only 0.05% of his portfolio was invested in real estate stocks at the end of the third quarter.
Century Communities is a builder of upscale homes, townhomes and flats in Colorado, Texas and Nevada, with a $326.99 million market cap. It reports itself as “one of the top five fastest growing homebuilders by total revenue.”
For the third quarter of 2014, Century Communities reported home sales revenue of $90.7 million, compared to $41.5 million in the prior year quarter, driven by a 141% increase in home closings. Net income was $4.1 million, or $0.19 per share, compared to $2.4 million for the same periods.
Century Communities ended the quarter with cash of $101.7 million and long-term debt of $210 million.
The company has a P/E ratio of 17.6, P/B ratio of 0.9 and P/S ratio of 1.0, all of which are near the low points of its brief trading history.
Three other gurus reported initiating a stake in Century Communities in the third quarter: Scott Black (Trades, Portfolio), Leon Cooperman (Trades, Portfolio) and Third Avenue Management (Trades, Portfolio).
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