(GuruFocus, June 16, 2009) Barring a disastrous decline for the last few trading days in this quarter, as we reported earlier, Berkshire Hathaway is going to report decent gain in its equity investment, which will give its book value a boost.
However, not every stock participated in the powerful rally since the market hit the bottom on March 9, 2009. Despite the strong 20% return of the total portfolio since the beginning of the quarter, these stocks hardly moved or even retreated:
Wal-Mart Stores Inc.(WMT, Financial),United Parcel Service Inc (UPS, Financial), Home Depot Inc. (HD, Financial), Comcast Corporation (CMCSK, Financial), Johnson & Johnson (JNJ, Financial).
If you are looking for candidates to invest among Warren Buffett’s stocks, starting with losers rather than high fliers seems to be more logic.
1. Wal-Mart Stores Inc., Down 7%
Wal-Mart Stores Inc. is the world's largest retailer. They are engaged in the operation of mass merchandising stores which serve their customers primarily through the operation of three segments which are the Wal-Mart Stores segment the SAM'S Club segment and the International segment. WalMart Stores Inc. has a market cap of $189.62 billion; its shares were traded at around $48.46 with a P/E ratio of 14.1 and P/S ratio of 0.5. The dividend yield of WalMart Stores Inc. stocks is 2.3%. WalMart Stores Inc. had an annual average earning growth of 13.3% over the past 10 years. GuruFocus rated WalMart Stores Inc. the business predictability rank of 5-star.
Berkshire Hathaway has had about 20 million shares of WMT since 2005. The stock is down about 7% for the quarter, and for the year, it is down about 14%. Today, Goldman Sachs downgraded the stock and our columnist Ravi Nagarajan apparently disagree with the rational of the action.
2. United Parcel Service Inc (UPS), down 0.4%
United Parcel Service Inc. is the world's largest express carrier the world's largest package delivery company and a leading global provider of specialized transportation and logistics services. United Parcel Service, Inc. has a market cap of $48.78 billion; its shares were traded at around $49 with a P/E ratio of 15.5 and P/S ratio of 1. The dividend yield of United Parcel Service, Inc. stocks is 3.7%. United Parcel Service, Inc. had an annual average earning growth of 17.2% over the past 5 years.
Berkshire Hathaway has held 1.42 million shares of UPS since 1Q06 when the stock price was much higher. The stock is down 0.4% for the quarter and 12% for the year.
3. Home Depot Inc. (HD), up 1.2%
Home Depot Inc.is the one of world's largest home improvement retailer. The Home Depot Inc. has a market cap of $40.45 billion; its shares were traded at around $23.85 with a P/E ratio of 14 and P/S ratio of 0.6. The dividend yield of The Home Depot Inc. stocks is 3.8%. The Home Depot Inc. had an annual average earning growth of 19.5% over the past 10 years. GuruFocus rated The Home Depot Inc. the business predictability rank of 5-star.
Berkshire Hathaway bought into the home improvement company in 2Q05 with a 5 million shares stake. It has sold a bit, but still held a significant position of 3.7 million shares for the past three quarters. It is up 1.2% for the quarter, and 0.8% for the year.
4. Comcast Corporation (CMCSK), up 2.5%
Comcast Corporation is principally involved in the development management and operation of broadband cable networks and in the provision of electronic commerce and programming content. Comcast Corp. Special has a market cap of $38.49 billion; its shares were traded at around $13.19 with and P/S ratio of 1.1. The dividend yield of Comcast Corp. Special stocks is 2.1%. Comcast Corp. Special had an annual average earning growth of 46.5% over the past 5 years.
Berkshire Hathaway was first seen to have 7.5 million shares of CMCSK in 3Q04. Its ownership went up as much as 16.7 million shares in 3Q05, but came down to 12 million shares in 4Q06. It held its position since then.
CMCSK is up 2.5% for the quarter and down 19.5% for the year.
5. Johnson & Johnson (JNJ), up 4.1%
Johnson & Johnson is engaged in the manufacture and sale of a broad range of products in the health care field in many countries of the world. The company's worldwide business is divided into three segments: Consumer; Pharmaceutical; and Professional. Johnson & Johnson has a market cap of $150.87 billion; its shares were traded at around $54.75 with a P/E ratio of 12 and P/S ratio of 2.4. The dividend yield of Johnson & Johnson stocks is 3.6%. Johnson & Johnson had an annual average earning growth of 12.5% over the past 10 years. GuruFocus rated Johnson & Johnson the business predictability rank of 4.5-star.
Berkshire Hathaway held 24.6 million shares of JNJ back in 3Q06. It upped its position to 61 million shares through 3Q07 and held that position until 4Q08 when the market crash forced Warren Buffett to sell shares to raise cash. However, he was seen buying JNJ again (4 million shares) in 1Q09.
JNJ is up 4.1% for the quarter but down 8.7% for the quarter.
Afterthought
The market had a good rally. S&P 500 is up about more than 13% for the second quarter and is in positive territory for the year. Yet, we saw some of the best stocks, stocks ranked by GuruFocus as 4-5 star and owned by Warren Buffett's Berkshire Hathaway, are still mired in the negative territory.
Perhaps that is where the values are?
GuruFocus has started publishing a news letter based on our Buffett-Munger stock screener. Starting from June 2009, each month, we screens, research and recommend on two stocks. The first issue is available through this link.
However, not every stock participated in the powerful rally since the market hit the bottom on March 9, 2009. Despite the strong 20% return of the total portfolio since the beginning of the quarter, these stocks hardly moved or even retreated:
Wal-Mart Stores Inc.(WMT, Financial),United Parcel Service Inc (UPS, Financial), Home Depot Inc. (HD, Financial), Comcast Corporation (CMCSK, Financial), Johnson & Johnson (JNJ, Financial).
If you are looking for candidates to invest among Warren Buffett’s stocks, starting with losers rather than high fliers seems to be more logic.
1. Wal-Mart Stores Inc., Down 7%
Wal-Mart Stores Inc. is the world's largest retailer. They are engaged in the operation of mass merchandising stores which serve their customers primarily through the operation of three segments which are the Wal-Mart Stores segment the SAM'S Club segment and the International segment. WalMart Stores Inc. has a market cap of $189.62 billion; its shares were traded at around $48.46 with a P/E ratio of 14.1 and P/S ratio of 0.5. The dividend yield of WalMart Stores Inc. stocks is 2.3%. WalMart Stores Inc. had an annual average earning growth of 13.3% over the past 10 years. GuruFocus rated WalMart Stores Inc. the business predictability rank of 5-star.
Berkshire Hathaway has had about 20 million shares of WMT since 2005. The stock is down about 7% for the quarter, and for the year, it is down about 14%. Today, Goldman Sachs downgraded the stock and our columnist Ravi Nagarajan apparently disagree with the rational of the action.
2. United Parcel Service Inc (UPS), down 0.4%
United Parcel Service Inc. is the world's largest express carrier the world's largest package delivery company and a leading global provider of specialized transportation and logistics services. United Parcel Service, Inc. has a market cap of $48.78 billion; its shares were traded at around $49 with a P/E ratio of 15.5 and P/S ratio of 1. The dividend yield of United Parcel Service, Inc. stocks is 3.7%. United Parcel Service, Inc. had an annual average earning growth of 17.2% over the past 5 years.
Berkshire Hathaway has held 1.42 million shares of UPS since 1Q06 when the stock price was much higher. The stock is down 0.4% for the quarter and 12% for the year.
3. Home Depot Inc. (HD), up 1.2%
Home Depot Inc.is the one of world's largest home improvement retailer. The Home Depot Inc. has a market cap of $40.45 billion; its shares were traded at around $23.85 with a P/E ratio of 14 and P/S ratio of 0.6. The dividend yield of The Home Depot Inc. stocks is 3.8%. The Home Depot Inc. had an annual average earning growth of 19.5% over the past 10 years. GuruFocus rated The Home Depot Inc. the business predictability rank of 5-star.
Berkshire Hathaway bought into the home improvement company in 2Q05 with a 5 million shares stake. It has sold a bit, but still held a significant position of 3.7 million shares for the past three quarters. It is up 1.2% for the quarter, and 0.8% for the year.
4. Comcast Corporation (CMCSK), up 2.5%
Comcast Corporation is principally involved in the development management and operation of broadband cable networks and in the provision of electronic commerce and programming content. Comcast Corp. Special has a market cap of $38.49 billion; its shares were traded at around $13.19 with and P/S ratio of 1.1. The dividend yield of Comcast Corp. Special stocks is 2.1%. Comcast Corp. Special had an annual average earning growth of 46.5% over the past 5 years.
Berkshire Hathaway was first seen to have 7.5 million shares of CMCSK in 3Q04. Its ownership went up as much as 16.7 million shares in 3Q05, but came down to 12 million shares in 4Q06. It held its position since then.
CMCSK is up 2.5% for the quarter and down 19.5% for the year.
5. Johnson & Johnson (JNJ), up 4.1%
Johnson & Johnson is engaged in the manufacture and sale of a broad range of products in the health care field in many countries of the world. The company's worldwide business is divided into three segments: Consumer; Pharmaceutical; and Professional. Johnson & Johnson has a market cap of $150.87 billion; its shares were traded at around $54.75 with a P/E ratio of 12 and P/S ratio of 2.4. The dividend yield of Johnson & Johnson stocks is 3.6%. Johnson & Johnson had an annual average earning growth of 12.5% over the past 10 years. GuruFocus rated Johnson & Johnson the business predictability rank of 4.5-star.
Berkshire Hathaway held 24.6 million shares of JNJ back in 3Q06. It upped its position to 61 million shares through 3Q07 and held that position until 4Q08 when the market crash forced Warren Buffett to sell shares to raise cash. However, he was seen buying JNJ again (4 million shares) in 1Q09.
JNJ is up 4.1% for the quarter but down 8.7% for the quarter.
Afterthought
The market had a good rally. S&P 500 is up about more than 13% for the second quarter and is in positive territory for the year. Yet, we saw some of the best stocks, stocks ranked by GuruFocus as 4-5 star and owned by Warren Buffett's Berkshire Hathaway, are still mired in the negative territory.
Perhaps that is where the values are?
| Ticker | % Weighting in Portfolio | P/E | Yield (%) | Market Cap ($M) | Price Change Since 2009-03-31 (%) | % Above 52-W Low | % Below 52-W High |
|---|---|---|---|---|---|---|---|
| WMT | 2.54% | 14.1 | 2.3 | 189618 | -7% | 4.39 | -23.29 |
| UPS | 0.17% | 15.5 | 3.7 | 48776.5 | -0.4% | 27.94 | -29.99 |
| HD | 0.21% | 14 | 3.8 | 40454.8 | +1.2% | 32.5 | -20.92 |
| CMCSK | 0.38% | 2.1 | 38490.7 | +2.5% | 26.46 | -40.64 | |
| JNJ | 4.18% | 12 | 3.6 | 150867 | +4.1% | 17.49 | -24.19 |
GuruFocus has started publishing a news letter based on our Buffett-Munger stock screener. Starting from June 2009, each month, we screens, research and recommend on two stocks. The first issue is available through this link.
