Manning & Napier Advisors Inc. acquired 35 new holdings during the final quarter of 2016. The firm’s top three new holdings are Bristol-Myers Squibb Co. (BMY, Financial), Regeneron Pharmaceuticals Inc. (REGN, Financial) and Campbell Soup Co. (CPB, Financial).
Manning & Napier was founded by Bill Manning and Bill Napier in April of 1970. The firm utilizes a team-based investment approach that focuses on maximizing long-term absolute returns. As of Dec. 31, 2016, the firm had $31.7 billion in assets under management.
After previously selling out of Bristol-Myers Squibb in the second quarter of 2014, the firm purchased a new holding of 3,060,280 shares, which represents 0.2% of the company’s outstanding shares. It paid an average price of $54.67 per share. The transaction had an impact of 1.2% on the portfolio.
Bristol-Myers Squibb is a biopharmaceutical company headquartered in New York City. It has a market cap of $82.8 billion and an enterprise value of $84.2 billion. Its shares were trading around $49.55 on Thursday with a price-earnings (P/E) ratio of 28.6, a price-book (P/B) ratio of 6 and a price-sales (P/S) ratio of 5.4.
The Peter Lynch chart below shows the stock is trading above its fair value.
GuruFocus ranked the company’s financial strength 7 of 10. The Piotroski F-Score of 5 and Altman Z-Score of 5.6 suggest the company is in stable financial condition. The cash-debt ratio of 0.8 indicates the company is not capable of covering outstanding debt with cash on hand.
Bristol-Myers Squibb’s profitability and growth was ranked 5 of 10 by GuruFocus. It has an operating margin of 19.8% and a net margin of 18.8%. The return on equity (ROE) and return on assets (ROA) outperform 87% and 79% of other companies in the global drug manufacturers-major industry. Similarly, the return on capital (ROC) outperforms 94% of competitors. In contrast, its three-year revenue growth, EPS growth and EBITDA growth are underperforming.
The Vanguard Health Care Fund (Trades, Portfolio) is the company’s largest shareholder with 2.9% of outstanding shares. This represents 5.7% of its total assets managed.
The firm bought 440,316 shares of Regeneron Pharmaceuticals for an average price of $380.27 per share. The holding expanded the firm’s portfolio by 1.1% and represents 0.42% of the company’s outstanding shares.
Regeneron is a biopharmaceutical company that develops treatments for serious medical conditions. The Tarrytown, New York-based company has a market cap of $36.8 billion and an enterprise value of $35.8 billion. Its shares were trading around $351.58 on Thursday with a P/E ratio of 51.7, a forward P/E ratio of 23.9, a P/B ratio of 8.2 and a P/S ratio of 8.5.
The Peter Lynch chart below indicates the stock is trading above its fair value.
GuruFocus ranked the company’s financial strength 8 of 10. The Piotroski F-Score of 6 and Altman Z-Score of 11.5 indicate the company is in stable financial condition. Regeneron’s return on invested capital (ROIC) outperforms its weighted average cost of capital (WACC) so it is creating value as it grows. The cash-debt ratio of 3.7 and interest coverage ratio of 319.6 suggest the company is able to cover its debt and interest expenses.
Regeneron’s profitability and growth was ranked 6 of 10 by GuruFocus. It has an operating margin of 25.7% and a net margin of 16.5%. The ROE and ROA outperform 92% and 93% of other companies in the global biotechnology industry. The ROC outperforms 90% of competitors. Only the company’s three-year EPS growth of -6.5% is underperforming its peers.
The Vanguard Health Care Fund (Trades, Portfolio) is the company’s largest shareholder with 3.1% of outstanding shares, which represents 2.8% of its total assets managed. In total, 11 gurus hold a position.
After exiting Campbell Soup in the second quarter of 2016, the firm established a new holding of 1,921,950 shares for an average price of $56.05 per share. The trade impacted the portfolio by 0.76%.
Campbell is known for its soup but also manufactures and markets a wide variety of convenience food products like sauces, cookies, pasta and salad dressing. The New Jersey-based company has a market cap of $19.3 billion and an enterprise value of $22.6 billion. Its shares were trading around $62.7 on Thursday with a P/E ratio of 29.6, a forward P/E of 20.8, a P/B ratio of 12.12 and a P/S ratio of 2.4.
The Peter Lynch chart below shows the stock is trading above its fair value.
GuruFocus ranked the company’s financial strength 5 of 10. The Piotroski F-Score of 7 and Altman Z-Score of 3.5 indicate the company is in healthy financial condition. Since the ROIC outperforms the WACC, Campbell is creating value as it grows. The cash-debt ratio of 0.08 suggests the company is not able to cover its debt with cash on hand.
Campbell’s profitability and growth was ranked 7 of 10 by GuruFocus. It has an operating margin of 15.7% and a net margin of 8.3%. The ROE and ROA outperform 95% and 76% of other companies in the global packaged foods industry. The ROC outperforms 84% of competitors. In contrast, the company’s three-year revenue growth, EPS growth and EBITDA growth are underperforming competitors.
Manning & Napier is the company’s largest shareholder with 0.63% of its outstanding shares. This represents 0.76% of its total assets managed. In total, seven gurus hold positions.
Other holdings established during the quarter were Sprouts Farmers Market Inc. (SFM, Financial), Zoetis Inc. (ZTS, Financial), and Cognizant Technology Solutions Corp. (CTSH, Financial). For all of the firm’s current holdings, view its portfolio.
Disclosure: I do not own any stocks mentioned in the article.
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