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James Li
James Li
Articles (866)  | Author's Website |

Ken Fisher Slashes Positions in Technology and Finance

Guru trims at least 50% from each of 4 positions

July 14, 2017 | About:

During the second quarter, investor Ken Fisher (Trades, Portfolio) of Fisher Investments trimmed over 50% of his position in four companies: Wells Fargo & Co. (NYSE:WFC), JPMorgan Chase & Co. (NYSE:JPM), Qualcomm Inc. (NASDAQ:QCOM) and United Technologies Corp. (NYSE:UTX).

Wells Fargo

Fisher divested 96.2% of his position in Wells Fargo, selling 17,529,159 shares for an average price of $53.54 per share.

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Although the company’s profitability ranks a good 6 out of 10, Wells Fargo’s financial strength ranks a modest 5. The company’s cash-debt ratio of 0.06 underperforms 97% of global banks, suggesting Wells Fargo has some kind of financial distress. Additionally, Wells Fargo’s interest coverage of 4.85 is slightly below Benjamin Graham’s required threshold of 5.

JPMorgan Chase & Co.

Fisher halved his JPMorgan position, selling 6,932,074 shares for an average price of $86.21 per share.

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JPMorgan has a higher financial strength rank than Wells Fargo, implying a good business operation. Unlike Wells, JPMorgan’s cash-debt ratio exceeds one, suggesting it has enough cash to pay off its debt. Chase Bank also has operating margins and net margins that are near a 10-year high and outperform about 60% of global competitors.

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Qualcomm

Fisher axed 89.11% of his Qualcomm stake, selling 8,947,912 shares for an average price of $55.88 per share.

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While Qualcomm’s profitability ranks a good 8 out of 10, the company’s operating margin is near a 10-year low of 21.09%. Furthermore, Qualcomm’s operating margin and gross margin declined 5% and 2.6% per year over the past five years.

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Although GuruFocus ranked Qualcomm’s predictability 4.5 out of 5, the company’s predictability rank is on watch.

United Technologies

Fisher trimmed 57.02% of his stake in United Technologies, selling 4,866,805 shares for an average price of $119.06 per share.

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Although the company has a good profitability rank of 7 and a predictability rank of 3.5 stars, United Technologies has modest financial strength. The company has an Altman Z-score slightly below the safe threshold of 2.99 and just 12 cents in cash for every $1 in debt.

See also

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

About the author:

James Li
I am an editorial assistant and researcher at GuruFocus. I have a Master's in Finance from SMU, and I enjoy writing reports on financial trends and investor portfolios. Follow me on Twitter at @JamesLiGuru!

Visit James Li's Website


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