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Tiziano Frateschi
Tiziano Frateschi
Articles (1975)  | Author's Website |

American International Group One of Most Weighted Buys in Q2 2015

Allergan, Monster Beverage, WEC, GNL also on list

The hedge fund American International Group (NYSE:AIG) in its last quarterly 13F reported a total value of its portfolio of $25 billion, with an increase of 2.94% since the previous quarter. During Q2 2015, the firm bought 341 new stocks and increased 1,794 of its existing stakes. The following are the most heavily weighted buys during the quarter.

It bought shares of Allergan PLC(AGN) with an impact of 0.20% on its portfolio.

It is an integrated specialty pharmaceutical company. The company is engaged in development, manufacturing, marketing, sale and distribution of generic, branded generic, brand name, biosimilar and over-the-counter pharmaceutical products. It also develops and out-licenses generic pharmaceutical products in Europe through its Medis third-party business. It operates in three segments, Pharma, Specialty Brands and Anda Distribution.

The company has a profitability and growth rating of 7 out of 10 with negative returns (ROE -6.23%, ROA -3.09) that are underperforming 75% of the Global Drug Manufacturers - Specialty & Generic industry. Financial strength has a rating of 5 out of 10 with a cash to debt of 0.04 that is underperforming the industry median of 2.35.

The price of the stock has risen by 591% during the last five years, by 14% year to date and has risen by 28% during the last 12 months. It is currently -13.35% from its 52-week high and +41.35% from its 52-week low.

The company has been bought by many hedge funds M&R Capital Management, Kelly Lawrence W & Associates, Moody Lynn & Lieberson, Sheets Smith Wealth Management, Perigon Wealth Management during the last quarter, and now the main hedge fund holding shares of the company is Vangurad Health Care Fund with 2.3% of outstanding shares, followed by John Paulson (Trades, Portfolio) with 1.82% and Steve Mandel (Trades, Portfolio) with 0.58%.

It bought shares of Monster Beverage Corp.(MNST) with an impact of 0.04% on its portfolio. The company, through its subsidiaries, markets and distributes energy drinks. The main raw materials used in the manufacturing of its products are aluminum cans, PET plastic and glass bottles as well as flavors, juice concentrates, sugar, sucralose, milk, cream, dietary ingredients and other packaging materials, the costs of which are subject to fluctuations.

The company has a profitability and growth rating of 8 out of 10 with positive returns (ROE 22.92%, ROA 17.86) that are outperforming 85% of the Global Beverages - Soft Drinks industry. Monster Beverage is out of debt.

The price of the stock has risen by 473% during the last five years, by 22% year to date and by 45% during the last 12 months. It is currently -15.04% from its 52-week high and +48.88% from its 52-week low.

During the last quarter the company could close a transaction with The Coca-Cola Co. (KO)and as a result of the transaction, MNST incurred obligations related to distributor terminations in the amount of $12.2 million and $218.2 million during the three and six months.

The main shareholder of the company is Joel Greenblatt (Trades, Portfolio) with 0.13% of outstanding shares, followed by Jim Simons (Trades, Portfolio) with 0.13% and Jeremy Grantham (Trades, Portfolio) with 0.07%.

It bought shares of WEC Energy Group Inc.(WEC) with an impact of 0.04% on its portfolio. The company conducts its operations mainly in two operating segments: a utility energy segment and a non-utility energy segment.

WEC has a profitability and growth rating of 7 out of 10 with positive returns (ROE 10.00%, ROA 2.97) that are outperforming 58% of the Global Utilities - Regulated Electric industry. Financial strength has a rating of 5 out of 10 with a weak cash to debt of 0.02 that is underperforming the 92% of other companies in the same industry that has an average ratio of 0.26.

The price of the stock has risen by 63% during the last five years, has dropped by 12% year to date and has risen by 5% during the last 12 months. It is currently -19.20% from its 52-week high and +10.20% from its 52-week low.

With continued focus on cost control, productivity and customer satisfaction, WEC delivered solid results in the second quarter as net income was $52.1 million or 23 cents a share less compared to the second quarter of 2014.

The main hedge fund holding shares of the company is Jim Simons (Trades, Portfolio) with 0.14% of outstanding shares, followed by Joel Greenblatt (Trades, Portfolio) with 0.06% and Robert Bruce (Trades, Portfolio) and Mario Gabelli (Trades, Portfolio) with an easy stake of 0.01%.

It bought shares of Global Net Lease Inc.(GNL) with an impact of 0.03% on its portfolio. It is a real estate investment trust that focuses on acquiring and managing a globally diversified portfolio of strategically located commercial real estate properties which are crucial to the success of GNL’s roster of primarily investment grade corporate tenants.

Global Net Lease has a profitability and growth rating of 2 out of 10 with negative returns (ROE -3.54%, ROA -2.27) that are underperforming 96% of the Global REIT - Diversified industry. Financial strength has a rating of 5 out of 10 with a cash to debt of 0.07 that has an average value compared to the industry median of 0.07.

The price of the stock has dropped by 7% during the last five years, by 7% year to date and even during the last 12 months. It is currently -13.70% from its 52-week high and +19.04% from its 52-week low.

In the last quarter they make the first reporting period as a publicly-traded company and began trading on the New York Stock Exchange under the ticker symbol "GNL.” It could purchase up to $125 million of its shares of common stock. For the rest of the year they believe that GNL is well positioned to continue to grow both by capitalizing on attractive acquisition opportunities in the United States and in Western and Northern Europe, as well as managing the earnings growth of existing property portfolio, so they expect to reach year-end Pro Forma Run Rate AFFO goal of $0.82 per fully diluted share, providing ample coverage to pay a dividend of $0.71 per share.

The only shareholder of the company is Ken Fisher (Trades, Portfolio) with 0.01% of outstanding shares of the company.

It bought shares of CEB Inc.(CEB) with an impact of 0.03% on its portfolio. The company is a member-based advisory company that equips senior executives and their teams with insight and actionable solutions to drive corporate performance. With its acquisition of SHL Group Holdings I and its subsidiaries in August 2012, the company operates through two reporting segments: CEB and SHL Talent Measurement.

CEB has a very high profitability that is rated 9 out of 10 with high returns like ROE 95.00% that is the best return of every other company in the same industry, and a ROA 6.98% that is outperforming 70% of the Global Business Services industry. Financial situation is weak; it has a rating of 5 out of 10 with a cash to debt of 0.25 that is underperforming 75% of its competitors in the same industry which has a ratio of 1.75.

The price of the stock has risen by 131% during the last five years, has dropped by 1% year to date and has risen by 6% during the last 12 months. It is currently -22.50% from its 52-week high and +23.25% from its 52-week low.

During the last quarter, revenue had an increase of 0.7% on a year-over-year basis, adjusted margin was 25.9%, compared to 24.2% in the second quarter of 2014. They expect full year 2015 adjusted EBITDA margin of between 25.5% and 26%, which would represent a 50 to 100 basis point improvement compared to 2014 adjusted EBITDA margin of 25%.

Chuck Royce (Trades, Portfolio) is the main shareholder of the company with 0.91% of outstanding shares, followed by Jim Simons (Trades, Portfolio) with 0.57% and Joel Greenblatt (Trades, Portfolio) with 0.08%.

Increased stakes

The hedge fund also increased seven of its stakes, and the most important are the following: Kraft Foods Group Inc. (KRFT) by 5%, Staples Inc. (SPLS) by 5%, Coach Inc. (COH) by 6%, Merck & Co Inc. (MRK) by 7% , Accenture PLC (ACN) by 5%, Omnicom Group (OMC)by 5.09%, CA Inc. (CA) by 5.38% and Kellogg Co. (K) by 5.66%

American International Group Top Buys Q2 2015

Ticker

Value (x1000)

Impact %

Trade

AGN

49,682

0.20%

New Buy

MNST

9,627

0.04%

New Buy

WEC

9,128

0.04%

New Buy

GNL

8,516

0.03%

New Buy

CEB

7,457

0.03%

New Buy

As of the latest quarter, the hedge fund has its portfolio divided by the following sectors:

Main Sectors

Finance

16%

Information Technology

16%

Consumer Discretionary

14%

Consumer Staples

13%

Health Care

10%

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About the author:

Tiziano Frateschi
You can read about me on www.theextraincome.info, which gives suggestions on position trading.

Visit Tiziano Frateschi's Website


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