Jean-Marie Eveillard is Chief Investment Officer of the Arnhold and S. Bleichroeder Advisers, LLC Global Value Team and Portfolio Manager of First Eagle Global, Overseas, Gold, and U.S. Funds. He managed to avoid much of the losses in 2008 by hoarding cash back in July 2008 when market was down 20%. Recently, however, he had a change in tone. In the Q408 Commentary he released recently, he stated “Sometimes when investing seems most scary it's the best time to invest. This may be one of those times.”
Indeed, according to GuruFocus’s recent report his Q4 2008 trading were very active. As of December 31, 2008, the $7.54 billion was spread among 351 companies. In any given quarter, he trades in and out 10s or even one hundred stocks. These traits make him one of the hard Gurus to follow. If you want to give up but still envy his long track record, buy his mutual funds. His First Eagle Global Fund A shares returned -25.01, 6.20%, and 11.62% in 1-, 5-, and 10-year period, respectively, handily beating the S&P 500 Index.
Before you give up on learning a thing or two about his investment style, here are his top five holdings as of December 31, 2008.
He invested almost 25% in just five stocks! On average, each of his 375 stocks will take less than 0.3% of his portfolio, so this is very high concentration.
In his latest 4Q2008 commentary, Jean-Marie revealed how he approaches stock investment currently: Although from a macroeconomic standpoint things look grim, the good news is that since we have some excess cash we are able to buy some securities at what we believe are fire-sale prices. As investors with long-term perspective, equities are beginning to look attractive, even as corporate profits come under pressure. We are focusing on the types of companies we always have--a combination of “cigar butts” (as Warren Buffett called Benjamin Graham-type stocks) and some truly exceptional businesses trading at appealing..
We believe these five stocks falls in the category of “some truly exceptional business trading at appealing prices”.
1. Berkshire Hathaway (BRK-A)
You ever wondered who are owners of the most expensive stock in nominal price? You find one here. If you ever wondered you should simply invest in Warren Buffett’s Berkshire Hathaway instead of making it on your own, you are not alone. You find some comrade here.
Jean-Marie Eveillard’s fund owns 5,055 shares of BRK-A. Each one share is a fortune for a middle class US family. GuruFocus record show Jean-Marie unloaded 1.68% of his position in Q4 2008, that is less than 10 shares. Maybe he is also doing what Warren Buffett did, raising cash to buy something else more attractive.
Warren Buffett released his 2009 Chairman’s Letter to Berkshire Hathawya Shareholders in the past weekend. During 2008, total book value of the company declined 9.6%. Yet the BRK-A shares fell almost 50%, making it a bargain by its own right.
GuruFocus 10-Year Valuations Chart shows although you have to go back to 2003 to find BRK-A this cheap, it is the cheapest in terms P/E, P/S, and P/B ratios.
2. Gold Fields Ltd. (GFI, Financial)
Back in October 2008, Jean Marie gave explained why he liked Gold Fields according to this article from Kiplinger.com
Today, GFI is quoted to be trading at $10.12 per share, still about 50% below what Jean Marie believes it worth.
GuruFocus 10-Year Valuations Chart below shows it is rising up from the recent low in relative terms of P/E, P/S, and P/B, much thanks to the strengthening of gold price lately.
3. Newmont Mining Corp. (NEM, Financial)
Jean-Marie Eveillard discussed the reason he likes Newmont Minging Corp. back in March 2003 according to this article
But that was in 2003. Today GuruFocus 10-Year Valuations Chart below shows that its price relative to earning, sales, and book value are above 50% between 10-year high and low. Given the bargains everywhere else, there are better places to put the money. Probably that is why Jean-Marie sold a tiny bit (0.78% of holding) of NEM and bought a tiny bit of more GFI (1.02%)?
4. 3M Company (MMM, Financial)
In 4Q2008, Jean-Marie added 4.2% to this Dow Jones Industrial Average component company. According to the 10-Year Valuations Chart below, you haven’t seen the company selling at valuation level this low in more than ten years.
5. Cintas Corp. (CTAS, Financial)
Jean-Marie Eveillard holds 7.41% of the company since 2007. Cintas Corp. provides uniforms, sanitation suppliers, and first aid products to businesses of all type. Jean Marie Eveillard was seen in this video recommending this stock.
GuruFocus rank the Business Predictability of Cintas 5-Star. For the past ten years, it managed to grow its top line by 11.5% per year consistently.
EPS has grown at a steady pace of 10.38% per year:
The all important Free Cash Flow, has increase more than 10-fold since 1998:
And yet, the stock is trading at the lowest level not seen in the 10 years, in absolute terms; even more so in relative terms:
Editor Note:
1. Business Predictability Ranking is GuruFocus's proprietary ranking of how business perform during the business cycles. For details, read this article.
2. 10-Year Valuations is a premium member analytical tool to evaluate a stock based on 10-Year P/E, P/B, P/S, and dividend yield. Free trial available. Click here to sign up
Indeed, according to GuruFocus’s recent report his Q4 2008 trading were very active. As of December 31, 2008, the $7.54 billion was spread among 351 companies. In any given quarter, he trades in and out 10s or even one hundred stocks. These traits make him one of the hard Gurus to follow. If you want to give up but still envy his long track record, buy his mutual funds. His First Eagle Global Fund A shares returned -25.01, 6.20%, and 11.62% in 1-, 5-, and 10-year period, respectively, handily beating the S&P 500 Index.
Before you give up on learning a thing or two about his investment style, here are his top five holdings as of December 31, 2008.
| Ticker | Company | Shares | Value ($1000) | Pct. of Portfolio |
| BRK-A | Berkshire Hathaway | 5,055 | 488,313 | 6.48% |
| GFI | Gold Fields Ltd. | 42,194,074 | 418,987 | 5.56% |
| NEM | Newmont Mining Corp. | 9,881,270 | 402,168 | 5.33% |
| MMM | 3M Company | 5,094,140 | 293,117 | 3.89% |
| CTAS | Cintas Corp. | 11,321,181 | 262,991 | 3.49% |
| Total | 24.75% |
He invested almost 25% in just five stocks! On average, each of his 375 stocks will take less than 0.3% of his portfolio, so this is very high concentration.
In his latest 4Q2008 commentary, Jean-Marie revealed how he approaches stock investment currently: Although from a macroeconomic standpoint things look grim, the good news is that since we have some excess cash we are able to buy some securities at what we believe are fire-sale prices. As investors with long-term perspective, equities are beginning to look attractive, even as corporate profits come under pressure. We are focusing on the types of companies we always have--a combination of “cigar butts” (as Warren Buffett called Benjamin Graham-type stocks) and some truly exceptional businesses trading at appealing..
We believe these five stocks falls in the category of “some truly exceptional business trading at appealing prices”.
1. Berkshire Hathaway (BRK-A)
You ever wondered who are owners of the most expensive stock in nominal price? You find one here. If you ever wondered you should simply invest in Warren Buffett’s Berkshire Hathaway instead of making it on your own, you are not alone. You find some comrade here.
Jean-Marie Eveillard’s fund owns 5,055 shares of BRK-A. Each one share is a fortune for a middle class US family. GuruFocus record show Jean-Marie unloaded 1.68% of his position in Q4 2008, that is less than 10 shares. Maybe he is also doing what Warren Buffett did, raising cash to buy something else more attractive.
Warren Buffett released his 2009 Chairman’s Letter to Berkshire Hathawya Shareholders in the past weekend. During 2008, total book value of the company declined 9.6%. Yet the BRK-A shares fell almost 50%, making it a bargain by its own right.
GuruFocus 10-Year Valuations Chart shows although you have to go back to 2003 to find BRK-A this cheap, it is the cheapest in terms P/E, P/S, and P/B ratios.
2. Gold Fields Ltd. (GFI, Financial)
Back in October 2008, Jean Marie gave explained why he liked Gold Fields according to this article from Kiplinger.com
A good chunk of the portfolio is in gold-related investments. In all of his funds, Eveillard says, "We have owned gold for a while as insurance against extreme outcomes." At last report, Overseas held 7% in gold bullion and 3% in gold-mining companies.
One such company is Gold Fields (GFI), a South African firm whose American depositary shares trade in the U.S. The managers believe the company is worth $20 a share, based on its 1 million ounces of identified gold reserves. The stock closed at $7.73 on October 2
Today, GFI is quoted to be trading at $10.12 per share, still about 50% below what Jean Marie believes it worth.
GuruFocus 10-Year Valuations Chart below shows it is rising up from the recent low in relative terms of P/E, P/S, and P/B, much thanks to the strengthening of gold price lately.
3. Newmont Mining Corp. (NEM, Financial)
Jean-Marie Eveillard discussed the reason he likes Newmont Minging Corp. back in March 2003 according to this article
6. What companies stand out to you in the gold arena?
The most attractive by far is Newmont Mining. True, there is some hedging, which we don't especially like. But this is entirely the result of the acquisition of an Australian gold company. The management is interested in eliminating the hedged position by the end of the year.
Pierre Lassonde became president after the acquisition. He is one of top two or three guys in the business in terms of intelligence.
But that was in 2003. Today GuruFocus 10-Year Valuations Chart below shows that its price relative to earning, sales, and book value are above 50% between 10-year high and low. Given the bargains everywhere else, there are better places to put the money. Probably that is why Jean-Marie sold a tiny bit (0.78% of holding) of NEM and bought a tiny bit of more GFI (1.02%)?
4. 3M Company (MMM, Financial)
In 4Q2008, Jean-Marie added 4.2% to this Dow Jones Industrial Average component company. According to the 10-Year Valuations Chart below, you haven’t seen the company selling at valuation level this low in more than ten years.
5. Cintas Corp. (CTAS, Financial)
Jean-Marie Eveillard holds 7.41% of the company since 2007. Cintas Corp. provides uniforms, sanitation suppliers, and first aid products to businesses of all type. Jean Marie Eveillard was seen in this video recommending this stock.
GuruFocus rank the Business Predictability of Cintas 5-Star. For the past ten years, it managed to grow its top line by 11.5% per year consistently.
EPS has grown at a steady pace of 10.38% per year:
The all important Free Cash Flow, has increase more than 10-fold since 1998:
And yet, the stock is trading at the lowest level not seen in the 10 years, in absolute terms; even more so in relative terms:
Editor Note:
1. Business Predictability Ranking is GuruFocus's proprietary ranking of how business perform during the business cycles. For details, read this article.
2. 10-Year Valuations is a premium member analytical tool to evaluate a stock based on 10-Year P/E, P/B, P/S, and dividend yield. Free trial available. Click here to sign up
