Bruce Berkowitz (Trades, Portfolio), founder of Fairholme Fund (Trades, Portfolio), gets his investment insights from Benjamin Graham’s “The Intelligent Investor.” He keeps a concentrated portfolio and prefers companies that have great management and undervalued stocks. In 2012 and 2013, Fairholme registered returns exceeding 35%.
Most of Berkowitz’s activity in the second quarter involved selling part of some of the stakes in his portfolio. His most significant second-quarter transaction was his sale of more than 21% of his stake in American International Group Inc. (AIG, Financial), a New York-based insurance and financial services company, for an average price of $59.02 per share. The sale had a -5.18% impact on Berkowitz’s portfolio.
AIG, Berkowitz’s second-most valuable stake, has a market cap of $74.84 billion and an enterprise value of $89.78 billion. It has a P/E of 11.5, a Price/Book of 0.7 and a Price/Sales of 1.3. Berkowitz is AIG’s leading shareholder among the gurus; Fairholme Fund (Trades, Portfolio), HOTCHKIS & WILEY, John Paulson (Trades, Portfolio), Richard Perry (Trades, Portfolio), First Pacific Advisors (Trades, Portfolio), Richard Pzena (Trades, Portfolio), Steven Romick (Trades, Portfolio), Bill Nygren (Trades, Portfolio), Diamond Hill Capital (Trades, Portfolio), First Eagle Investment (Trades, Portfolio), James Barrow (Trades, Portfolio), Daniel Loeb (Trades, Portfolio), Leon Cooperman (Trades, Portfolio), John Griffin (Trades, Portfolio), Charles Brandes (Trades, Portfolio), Larry Robbins (Trades, Portfolio), Donald Smith (Trades, Portfolio), Andreas Halvorsen (Trades, Portfolio), Jeremy Grantham (Trades, Portfolio), Mario Gabelli (Trades, Portfolio), Chris Davis (Trades, Portfolio), Richard Snow (Trades, Portfolio), Stanley Druckenmiller (Trades, Portfolio), RS Investment Management (Trades, Portfolio), Pioneer Investments (Trades, Portfolio), Arnold Schneider (Trades, Portfolio), Steven Cohen (Trades, Portfolio), NWQ Managers (Trades, Portfolio), Murray Stahl (Trades, Portfolio), Jeff Auxier (Trades, Portfolio), Ken Heebner (Trades, Portfolio), Ken Fisher (Trades, Portfolio), David Dreman (Trades, Portfolio), Joel Greenblatt (Trades, Portfolio) and Tom Russo (Trades, Portfolio) have shares of AIG in their portfolios.
Berkowitz also reduced his stake in Leucadia National (Trades, Portfolio) Corp. (LUK, Financial), a New York City-based holding company, by nearly 11%, selling 1,482,186 shares for an average price of $23.84 per share. The reduction had a -0.62% impact on Berkowitz’s portfolio.
Leucadia National (Trades, Portfolio) has a market cap of $7.52 billion. It has a P/E of 17.9, a Price/Book of 0.7 and a Price/Sales of 0.7. Fairholme Fund (Trades, Portfolio), Columbia Wanger (Trades, Portfolio), First Pacific Advisors (Trades, Portfolio), Third Avenue Management (Trades, Portfolio), Murray Stahl (Trades, Portfolio), Charles Brandes (Trades, Portfolio), Tweedy Browne (Trades, Portfolio), Chuck Royce (Trades, Portfolio), Jeremy Grantham (Trades, Portfolio), George Soros (Trades, Portfolio), First Eagle Investment (Trades, Portfolio), Paul Tudor Jones (Trades, Portfolio), Ruane Cunniff (Trades, Portfolio) and Joel Greenblatt (Trades, Portfolio) have shares of Leucadia National (Trades, Portfolio) in their portfolios.
Berkowitz sold 1,268,780 shares of his most-valuable stake, Bank of America Corporation (BAC, Financial), a Charlotte, N.C.-based banking and financial services company, for an average price of $16.46 per share. The transaction had a -0.37% impact on Berkowitz’s portfolio.
Bank of America has a market cap of $162.79 billion and an enterprise value of $296.87 billion. It has a P/E of 16.6, a Price/Book of 0.7 and a Price/Sales of 2.0. Dodge & Cox, James Barrow (Trades, Portfolio), Fairholme Fund (Trades, Portfolio), HOTCHKIS & WILEY, Ken Fisher (Trades, Portfolio), Bill Nygren (Trades, Portfolio), Richard Pzena (Trades, Portfolio), Brian Rogers (Trades, Portfolio), First Pacific Advisors (Trades, Portfolio), Steven Romick (Trades, Portfolio), Caxton Associates (Trades, Portfolio), Pioneer Investments (Trades, Portfolio), Charles Brandes (Trades, Portfolio), NWQ Managers (Trades, Portfolio), Jim Simons (Trades, Portfolio), Donald Yacktman (Trades, Portfolio), Yacktman Fund (Trades, Portfolio), Louis Moore Bacon (Trades, Portfolio), Jeremy Grantham (Trades, Portfolio), Charlie Munger (Trades, Portfolio), David Tepper (Trades, Portfolio), Steven Cohen (Trades, Portfolio), Richard Snow (Trades, Portfolio), Ken Heebner (Trades, Portfolio), Chris Davis (Trades, Portfolio), Ruane Cunniff (Trades, Portfolio), Jeff Auxier (Trades, Portfolio), Mark Hillman (Trades, Portfolio), Paul Tudor Jones (Trades, Portfolio), Mario Gabelli (Trades, Portfolio), David Dreman (Trades, Portfolio), Tom Russo (Trades, Portfolio), Michael Price (Trades, Portfolio), Kahn Brothers (Trades, Portfolio), T Boone Pickens (Trades, Portfolio), Murray Stahl (Trades, Portfolio), Joel Greenblatt (Trades, Portfolio), Glenn Greenberg (Trades, Portfolio) and Bill Frels (Trades, Portfolio) have shares of Bank of America in their portfolios.
Berkowitz sold nearly 45% of his stake in Berkshire Hathaway Inc. (BRK.B, Financial), an Omaha, Neb.-based holding company. Berkowitz sold 124,008 shares for an average price of $142.66 per share. The sale had a -0.34% impact on Berkowitz’s portfolio.
Berkshire Hathaway has a market cap of $318.29 billion and an enterprise value of $339.44 billion. It has a P/E of 17.8, a Price/Book of 1.3 and a Price/Sales of 1.6. Bill Gates (Trades, Portfolio), Ken Fisher (Trades, Portfolio), Ruane Cunniff (Trades, Portfolio), David Rolfe (Trades, Portfolio), Lou Simpson (Trades, Portfolio), Tom Russo (Trades, Portfolio), Tom Gayner (Trades, Portfolio), Wallace Weitz (Trades, Portfolio), Chris Davis (Trades, Portfolio), Jim Simons (Trades, Portfolio), Jeremy Grantham (Trades, Portfolio), Tweedy Browne (Trades, Portfolio), Charles de Vaulx (Trades, Portfolio), Chuck Akre (Trades, Portfolio), Arnold Van Den Berg (Trades, Portfolio), Murray Stahl (Trades, Portfolio), Scott Black (Trades, Portfolio), John Rogers (Trades, Portfolio), Mario Gabelli (Trades, Portfolio), Ray Dalio (Trades, Portfolio), Louis Moore Bacon (Trades, Portfolio), Zeke Ashton (Trades, Portfolio), Whitney Tilson (Trades, Portfolio), Jeff Auxier (Trades, Portfolio), Prem Watsa (Trades, Portfolio), Dodge & Cox, Donald Yacktman (Trades, Portfolio), Bill Frels (Trades, Portfolio), Pioneer Investments (Trades, Portfolio), Steven Cohen (Trades, Portfolio), Paul Tudor Jones (Trades, Portfolio), First Eagle Investment (Trades, Portfolio), Tweedy Browne (Trades, Portfolio) Global Value, Wintergreen Fund (Trades, Portfolio) and Bestinfond (Trades, Portfolio) have shares of Berkshire Hathaway in their portfolios.
Berkowitz also reduced his stake in The St. Joe Co. (JOE, Financial) and sold two modest stakes – Wells Fargo & Co. (WFC, Financial) and Canadian Natural Resources Ltd. (CNQ, Financial) – in the second quarter.
Berkowitz bought one new stake in the second quarter – National Oilwell Varco Inc. (NOV, Financial), a Houston-based oilfield services and equipment company and his first new buy of 2015. Berkowitz purchased 1,131,800 shares for an average price of $51.38 per share. The acquisition had a 1.11% impact on Berkowitz’s portfolio.
National Oilwell Varco has a market cap of $14.61 billion and an enterprise value of $16.45 billion. It has a P/E of 8.5, a Price/Book of 0.8 and a Price/Sales of 0.8. Dodge & Cox, First Eagle Investment (Trades, Portfolio), David Rolfe (Trades, Portfolio), Bill Nygren (Trades, Portfolio), Sarah Ketterer (Trades, Portfolio), Larry Robbins (Trades, Portfolio), PRIMECAP Management (Trades, Portfolio), John Rogers (Trades, Portfolio), Tom Gayner (Trades, Portfolio), Steven Cohen (Trades, Portfolio), Tweedy Browne (Trades, Portfolio), Joel Greenblatt (Trades, Portfolio), Tweedy Browne (Trades, Portfolio) Global Value, Robert Olstein (Trades, Portfolio), Ray Dalio (Trades, Portfolio), John Hussman (Trades, Portfolio), Manning & Napier Advisors, Inc., Mario Gabelli (Trades, Portfolio) and Jeremy Grantham (Trades, Portfolio) have shares of National Oilwell Varco in their portfolios.
Berkowitz also raised two of his existing stakes – Sears Holdings Corp. (SHLD, Financial) and Sears Canada Inc. (SRSC, Financial).
Berkowitz increased his stake in Sears Holdings, a Hoffman Estates, Ill.-based holding company, by 640,275 shares. Berkowitz paid an average price of $38.61 per share in a transaction that had a 0.35% impact on his portfolio.
Sears Holdings, Berkowitz’s third-most valuable stake, has a market cap of $2.7 billion and an enterprise value of $3.96 billion. It has a Price/Sales of 0.1. By a narrow margin, Berkowitz is Sears Holdings’ leading shareholder among the gurus; Edward Lampert (Trades, Portfolio), Fairholme Fund (Trades, Portfolio), Murray Stahl (Trades, Portfolio), Leon Cooperman (Trades, Portfolio), Francis Chou (Trades, Portfolio) and Jim Simons (Trades, Portfolio) have shares of Sears Holdings in their portfolios.
Berkowitz raised his stake in Sears Canada, a Toronto-based retailer, by nearly 10%, acquiring 1,394,217 shares for an average price of $8.04 per share. The deal had a 0.17% impact on his portfolio.
Sears Canada has a market cap of $665.26 million and an enterprise value of $595.09 million. It has a Price/Book of 1.7 and a Price/Sales of 0.3. Edward Lampert (Trades, Portfolio), Murray Stahl (Trades, Portfolio), Francis Chou (Trades, Portfolio) and Jim Simons (Trades, Portfolio) have shares of Sears Canada in their portfolios.
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