Joel Greenblatt Buys Fox, ConAgra and Intuit

The guru's top 3 2nd-quarter buys

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Aug 18, 2016
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During the second quarter, Joel Greenblatt (Trades, Portfolio) of Gotham Asset Management LLC acquired three new holdings. They are Twenty-First Century Fox Inc. (FOXA, Financial), ConAgra Foods Inc. (CAG, Financial) and Intuit Inc. (INTU, Financial).

Greenblatt is the founder and portfolio manager of Gotham Asset Management. He is the creator of Magic Formula Investing, which emphasizes high return on capital (ROC) and earnings yield. He also founded the New York Securities Auction Corp. (NYSAC) and is an adjunct professor at Columbia Business School. The firm holds stock in 935 companies and is worth $8.3 million. The turnover rate is 35%.

Twenty-First Century Fox

In Fox, Greenblatt purchased 2,822,168 shares at an average price of $29.13 per share. The transaction had an impact of 0.92% on the portfolio.

Fox, a media and entertainment company, has a market cap of $47.3 billion with an enterprise value of $63.8 billion. It has a price-earnings (P/E) ratio of 17.9 with a forward P/E of 13. Its price-book (P/B) ratio is 3.5, and its price-sales (P/S) ratio is 1.8. GuruFocus ranked its financial strength 5 of 10 and its profitability and growth 7 of 10.

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The company’s operating margin is 21.9% and its net margin is 10.1%. Its ROC is 123.5%. Its Piotroski F-Score is 6, indicating a stable business condition. Its Altman Z-Score is 2.01, placing it in the grey zone.

Previously, Greenblatt sold out of Fox in the fourth quarter of 2015. Among the gurus invested in Fox, Dodge & Cox is the largest shareholder.

ConAgra Foods

In ConAgra, Greenblatt purchased 1,387,032 shares at an average price of $45.8 per share. The transaction had an impact of 0.79% on the portfolio.

ConAgra, a packaged foods company, has a market cap of $20.5 billion with an enterprise value of $25.2 billion. Its forward P/E is 19.6, its P/B is 5.5, and its P/S is 1.7. GuruFocus ranked its financial strength 5 of 10 and its profitability and growth 5 of 10.

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The company’s operating margin is 7.6% and its net margin is -5.8%. Its ROC is 23.3%. Its Piotroski F-Score is 6, indicating a stable business condition. Its Altman Z-Score is 2.78, placing it in the grey zone.

Previously, Greenblatt sold out of ConAgra in the first quarter of 2016. Among the gurus invested in ConAgra, Jana Partners (Trades, Portfolio) is the largest shareholder.

Intuit

In Intuit, Greenblatt purchased 508,586 shares at an average price of $104.58 per share. The transaction had an impact of 0.68% on the portfolio.

Intuit creates business and financial management solutions. It has a market cap of $28.7 billion with an enterprise value of $28.2 billion. It has a P/E of 28.3 with a forward P/E of 26.2. Its P/B is 23.1, and its P/S is 6.5. GuruFocus ranked its financial strength 7 of 10 and its profitability and growth 8 of 10.

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The company’s operating margin is 25.2% and its net margin is 22.3%. Its ROC is 144.1%. Its Piotroski F-Score is 7, indicating a strong business condition. Its Altman Z-Score is 8.2, placing it in the safe zone.

Previously, Greenblatt sold out of Intuit in the fourth quarter of 2015. Among the gurus invested in Intuit, PRIMECAP Management (Trades, Portfolio) is the largest shareholder.

Disclosure: I do not own stock in any companies mentioned in the article.

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