Yacktman Fund Reduces Positions in PepsiCo, Coca-Cola in Third Quarter

Guru sells stakes in eBay and PayPal

Oct 15, 2015

The Yacktman Fund (Trades, Portfolio) primarily invests in U.S. companies, and its noteworthy transactions in the third quarters did involve U.S.-based companies, some of which pay dividends. In recent years, the Fund has produced double-digit returns, exceeding 20% in 2013.

The Yacktman Fund (Trades, Portfolio) reduced its position in PepsiCo Inc. (PEP, Financial) by more than one-fifth in the third quarter.

The Fund sold 2,200,000 shares of the Purchase, N.Y.-based food, snack and beverage company for an average price of $95.13 per share. The deal had a -2.14% impact on the Fund’s portfolio.

PepsiCo has a market cap of $142.65 billion and an enterprise value of $163.98 billion. It has a P/E of 29.1, a forward P/E of 20.1, a P/B of 10.6 and a P/S of 2.3. GuruFocus has given PepsiCo a Financial Strength rating of 8/10 and a Profitability and Growth rating of 7/10.

The Yacktman Fund (Trades, Portfolio) also reduced its stake in Coca-Cola (KO, Financial), the Atlanta-based beverage company, by nearly 17%.

The Fund sold 2,400,000 shares of Coca-Cola for an average price of $40.07 per share. The transaction had a -0.98% impact on the Fund’s portfolio.

Coca-Cola has a market cap of $181.87 billion and an enterprise value of $205.46 billion. It has a P/E of 24.3, a forward P/E of 19.6, a P/B of 6.4 and a P/S of 4.0. GuruFocus has given Coca-Cola a Financial Strength rating of 8/10 and a Profitability and Growth rating of 7/10.

The Yacktman Fund (Trades, Portfolio) sold out three stakes in the third quarter – eBay Inc. (EBAY, Financial), Sigma-Aldrich Corp. (SIAL, Financial) and PayPal Holdings Inc. (PYPL, Financial).

The Fund sold its 3,100,000-share stake in eBay, a San Jose, Calif.-based ecommerce company, for an average price of $26.89 per share. The divestiture had a -1.95% impact on the Fund’s portfolio.

eBay has a market cap of $29.37 billion and an enterprise value of $26.44 billion. It has a P/E of 12.5, a forward P/E of 11.2, a P/B of 1.5 and a P/S of 1.6. GuruFocus has given eBay a Financial Strength rating of 7/10 and a Profitability and Growth rating of 8/10.

The Fund divested itself of its 800,000-share stake in Sigma-Aldrich, a St. Louis-based life science and technology company, for an average price of $139.51 per share. The sale had a -1.16% impact on the Fund’s portfolio.

Sigma-Aldrich has a market cap of $16.72 billion and an enterprise value of $15.97 billion. It has a P/E of 34.7, a forward P/E of 29.4, a P/B of 5.1 and a P/S of 6.1. GuruFocus has given Sigma-Aldrich a Financial Strength rating of 8/10 and a Profitability and Growth rating of 8/10.

Donald Yacktman (Trades, Portfolio), Jim Simons (Trades, Portfolio), Mario Gabelli (Trades, Portfolio), Jeremy Grantham (Trades, Portfolio), Paul Tudor Jones (Trades, Portfolio), George Soros (Trades, Portfolio), Murray Stahl (Trades, Portfolio), Dodge & Cox, Bill Frels (Trades, Portfolio) and First Pacific Advisors (Trades, Portfolio) have shares of Sigma-Aldrich in their portfolios.

The Fund sold its 3,100,000-share stake in PayPal, a San Jose, Calif.-based financial services company, for an average price of $35.94 per share.

PayPal has a market cap of $41.92 billion and an enterprise value of $40.79 billion. It has a P/E of 110.9, a forward P/E of 23.1, a P/B of 5.3 and a P/S of 5.1. GuruFocus has given PayPal a Financial Strength rating of 4/10 and a Profitability and Growth rating of 3/10.

The Yacktman Fund (Trades, Portfolio) added to four existing stakes in the third quarter – Twenty-First Century Fox Inc. (FOXA, Financial) and (FOX, Financial), a New York City-based mass media company, Johnson & Johnson (JNJ, Financial), a New Jersey-based pharmaceutical and medical equipment company, and Oracle Corporation (ORCL, Financial), a Redwood City, Calif.-based computer software and hardware company.

The Fund bought 904,000 shares of FOXA for an average price of $29.89 per share and 656,000 shares of FOX for an average price of $29.68 per share. The FOXA transaction had a 0.3% impact on the Fund’s portfolio; the FOX transaction had a 0.22% impact.

Twenty-First Century Fox (FOXA, Financial) has a market cap of $58.44 billion and an enterprise value of $70.02 billion. Twenty-First Century Fox (FOX, Financial) has a market cap of $58.71 billion and an enterprise value of $70.25 billion. Both stocks have a P/E of 7.5, a forward P/E of 14.8, a P/B of 3.4 and a P/S of 2.1. GuruFocus has given both FOXA and FOX a Financial Strength rating of 6/10 and a Profitability and Growth rating of 7/10.

The Fund bought 100,000 shares of Johnson & Johnson for an average price of $96.79 per share. The purchase had a 0.12% impact on the Fund’s portfolio.

Johnson & Johnson has a market cap of $267.91 billion and an enterprise value of $267.91 billion. It has a P/E of 24.1, a forward P/E of 14.8, a P/B of 3.8 and a P/S of 3.8. GuruFocus has given Johnson & Johnson a Financial Strength rating of 8/10 and a Profitability and Growth rating of 8/10.

The Yacktman Fund (Trades, Portfolio) bought no new stakes in the third quarter.

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