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David Goodloe
David Goodloe
Articles (769) 

Mawer Canadian Equity Sells Stake in Valeant

Pattern with many of guru's transactions has been to buy or sell shares in 2nd and 4th quarters

In the second quarter of 2011, Mawer Canadian Equity Fund (Trades, Portfolio) acquired a stake in Valeant Pharmaceuticals International Inc. (TSX:VRX), a Canadian pharmaceutical company, then sold pieces of the stake in every second and fourth quarter since – a familiar pattern with Mawer's fourth-quarter deals – until selling the stake entirely in the fourth quarter of 2015.

Mawer sold 201,679 shares for an average price of C$111.15 ($84.43 in U.S. currency) per share, which was more than twice what the fund paid for them in 2011. The divestiture had a -3.01% impact on the guru’s portfolio.

Valeant has a P/E of 18.3, a forward P/E of 2.4, a P/B of 1.5 and a P/S of 1. GuruFocus gives Valeant a Financial Strength rating of 6/10 and a Profitability and Growth rating of 9/10.

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Valeant sold for C$37.81 ($28.72 in American dollars) per share Tuesday.

Similarly, Mawer purchased a stake in Canadian Energy Services & Technology (TSX:CEU), a Canadian provider of consumable chemical oilfield solutions, in the fourth quarter of 2014, sold part of it in the second quarter of 2015, then sold the remaining stake in the fourth quarter of 2015.

Mawer sold 872,205 shares for an average price of C$3.07 ($2.33 in American dollars) per share. The divestiture had a -0.34% impact on the guru’s portfolio.

Mawer New Canada Fund (Trades, Portfolio) is Canadian Energy Services’ only shareholder among the gurus with a stake of 7,534,338 shares. The stake is 3.42% of Canadian Energy Services’ outstanding shares and 2.76% of Mawer New Canada Fund (Trades, Portfolio)’s total assets.

Canadian Energy Services has a forward P/E of 178.6, a P/B of 1.3 and a P/S of 0.9. GuruFocus gives Canadian Energy Services a Financial Strength rating of 6/10 and a Profitability and Growth rating of 7/10.

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Canadian Energy Services sold for C$3.19 ($2.42 in U.S. money) per share Tuesday.

Since acquiring a stake in the company in the fourth quarter of 2011, Mawer Canadian Equity Fund (Trades, Portfolio) has followed a similar pattern of buying or selling shares in Richelieu Hardware Ltd. (TSX:RCH), a Canadian importer and distributor of specialty products for the kitchen cabinet and furniture markets, in second and fourth quarters.

In the fourth quarter of 2015, the guru raised its stake by nearly 215% with the purchase of 1,172,398 shares for an average price of C$23.37 ($17.75 in U.S. money) per share. The transaction had a 1.43% impact on Mawer’s portfolio.

The stake, now 1,717,947 shares, is 2.93% of Richelieu’s outstanding shares and 2.09% of the guru’s total assets. Mawer Canadian Equity Fund (Trades, Portfolio) is Richelieu’s leading shareholder among the gurus.

Richelieu has a P/E of 22.9, a forward P/E of 19.4, a P/B of 3.6 and a P/S of 1.8. GuruFocus gives Richelieu a Financial Strength rating of 9/10 and a Profitability and Growth rating of 7/10.

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Richelieu sold for C$22.71 ($17.25 in American currency) per share Tuesday.

Mawer raised its stake in CI Financial Corp. (TSX:CIX), a wealth management firm based in Toronto, by more than 18%. Mawer purchased 299,900 shares for an average price of C$31.45 ($23.89 in American currency) per share. The deal had a 0.49% impact on Mawer’s portfolio.

The stake, now 1,943,845 shares, is 0.7% of CI Financial’s outstanding shares and 3.2% of Mawer’s total assets. Leith Wheeler Canadian Equity (Trades, Portfolio) is CI Financial’s leading shareholder among the gurus with a stake of 2,063,450 shares. The stake is 0.75% of CI Financial’s outstanding shares and 3.08% of Leith Wheeler’s total assets.

CI Financial has a P/E of 14.6, a forward P/E of 13.1, a P/B of 4.2 and a P/S of 4. GuruFocus gives CI Financial a Financial Strength rating of 8/10 and a Profitability and Growth rating of 8/10.

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CI Financial sold for C$28.91 ($21.96 in U.S. money) per share Tuesday.

Mawer hiked its stake in Toromont Industries Ltd. (TSX:TIH), a Canadian supplier of construction equipment, power, refrigeration and process systems, by nearly 19% with the acquisition of 239,071 shares for an average price of C$32.93 ($25.01 in U.S. money). The transaction had a 0.41% impact on Mawer’s portfolio.

The stake, now 1,500,882 shares, is 1.93% of Toromont’s outstanding shares and 2.55% of Mawer’s total assets. Leith Wheeler is Toromont’s leading shareholder among the gurus with a stake of 2,249,658 shares. The stake is 2.89% of Toromont’s outstanding shares and 3.12% of Leith Wheeler’s total assets.

Toromont has a P/E of 18, a forward P/E of 15.9, a P/B of 3.4 and a P/S of 1.5. GuruFocus gives Toromont a Financial Strength rating of 8/10 and a Profitability and Growth rating of 4/10.

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Toromont sold for C$33.45 ($25.41 in American dollars) per share Tuesday.

Mawer increased its stake in Bank of Montreal (TSX:BMO), a financial services company based in Montreal, by more than 15%. Mawer bought 77,568 shares for an average price of C$74.33 ($56.46 in American dollars) per share. The deal had a 0.33% impact on Mawer’s portfolio.

The stake, now 580,200 shares, is 0.09% of Bank of Montreal’s outstanding shares and 2.44% of Mawer’s total assets. Mawer is Bank of Montreal’s leading shareholder among the gurus.

Bank of Montreal has a P/E of 11.7, a forward P/E of 10.5, a P/B of 1.3 and a P/S of 2.6. GuruFocus gives Bank of Montreal a Financial Strength rating of 6/10 and a Profitability and Growth rating of 7/10.

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Bank of Montreal sold for C$78.39 ($59.54 in U.S. currency) per share Tuesday.

Mawer boosted its stake in First Capital Realty Inc. (TSX:FCR), a Toronto-based owner, developer and manager of urban properties, by nearly 14% with the acquisition of 335,641 shares for an average price of C$18.67 ($14.18 in U.S. currency) per share. The transaction had a 0.33% impact on Mawer’s portfolio.

The stake, now 2,763,352 shares, is 1.23% of First Capital’s outstanding shares and 2.73% of Mawer’s total assets. Mawer is First Capital Realty’s leading shareholder among the gurus.

First Capital has a P/E of 22.8, a forward P/E of 19.9, a P/B of 1.3 and a P/S of 7.2. GuruFocus gives First Capital a Financial Strength rating of 6/10 and a Profitability and Growth rating of 6/10.

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First Capital sold for C$20.53 ($15.59 in American dollars) per share Tuesday.

Mawer raised its stake in Manulife Financial Corp. (TSX:MFC), a Toronto-based insurance company and financial services provider, by more than 9%. Mawer purchased 248,777 shares for an average price of C$21.71 ($16.49 in American money) per share. The deal had a 0.28% impact on Mawer’s portfolio.

The stake, now 2,943,887 shares, is 0.15% of Manulife’s outstanding shares and 3.28% of Mawer’s total assets. Leith Wheeler is Manulife’s leading shareholder among the gurus with a stake of 4,028,800 shares. The stake is 0.2% of Manulife’s outstanding shares and 4.16% of Leith Wheeler’s total assets.

Manulife has a P/E of 17.1, a forward P/E of 8.6, a P/B of 0.9 and a P/S of 1. GuruFocus gives Manulife a Financial Strength rating of 6/10 and a Profitability and Growth rating of 4/10.

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Manulife sold for C$18.09 ($13.74 in U.S. money) per share Tuesday.

Mawer hiked its stake in Toronto-Dominion Bank (TSX:TD), a banking and financial services company based in Toronto, by nearly 6%. Mawer purchased 94,202 shares for an average price of C$53.09 ($40.33 in U.S. dollars) per share. The transaction had a 0.27% impact on Mawer’s portfolio.

The stake, now 1,729,214 shares, is 0.09% of Toronto-Dominion’s outstanding shares and 5.04% of Mawer’s total assets. Leith Wheeler is Toronto-Dominion’s leading shareholder among the gurus with a stake of 3,153,200 shares. The stake is 0.17% of Toronto-Dominion’s outstanding shares and 7.43% of Leith Wheeler’s total assets.

Toronto-Dominion has a P/E of 13, a forward P/E of 11, a P/B of 1.6 and a P/S of 3.2. GuruFocus gives Toronto-Dominion a Financial Strength rating of 6/10 and a Profitability and Growth rating of 7/10.

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Toronto-Dominion sold for C$55.76 ($42.35 in American currency) per share Tuesday.

Mawer trimmed its stake in Constellation Software Inc. (TSX:CSU), a Toronto-based provider of software and services to public and private customers, by more than 17%. Mawer sold 29,279 shares for an average price of C$562 ($426.88 in American currency) per share. The deal had a -0.78% impact on Mawer’s portfolio.

The remaining stake of 138,243 shares is 0.65% of Constellation’s outstanding shares and 4.29% of Mawer’s total assets. Mawer is Constellation’s leading shareholder among the gurus.

Constellation has a P/E of 49.2, a forward P/E of 17.3, a P/B of 24.8 and a P/S of 4.7. GuruFocus gives Constellation a Financial Strength rating of 8/10 and a Profitability and Growth rating of 9/10.

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Constellation sold for C$540.8 ($410.77 in U.S. dollars) per share Tuesday.

Hydro One Ltd. (TSX:H), an electricity transmission and distribution company based in Toronto, was Mawer’s only new buy in the fourth quarter. Mawer bought a 486,210-share stake for an average price of C$22.23 ($16.89 in U.S. dollars) per share. The transaction had a 0.58% impact on Mawer’s portfolio.

The stake is 0.08% of Hydro One’s outstanding shares and 0.58% of Mawer’s total assets. Mawer is Hydro One’s only shareholder among the gurus.

Hydro One has a P/E of 17, a forward P/E of 19.1, a P/B of 1.5 and a P/S of 1.8. GuruFocus gives Hydro One a Financial Strength rating of 6/10 and a Profitability and Growth rating of 5/10.

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Hydro One sold for C$23.69 ($17.99 in American money) per share Tuesday.

To view the portfolios of more gurus, visit the List of Gurus page. Not a premium member of GuruFocus? Try it free for seven days.

About the author:

David Goodloe
I'm a journalist by training. I grew up in Arkansas and earned my B.A. at the University of Arkansas. I earned my master's degree at the University of North Texas. My background includes stints at newspapers in Arkansas and Texas and teaching news writing and news editing to students at the University of Oklahoma and Richland College here in Dallas. I'm a writer/editor at GuruFocus.

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