1. How to use GuruFocus - Tutorials
  2. What Is in the GuruFocus Premium Membership?
  3. A DIY Guide on How to Invest Using Guru Strategies
Sydnee Gatewood
Sydnee Gatewood
Articles (671) 

Robert Olstein Picks Up 4 Consumer Defensive Stocks

Guru exits position in Big Lots

Olstein Capital Management leader Robert Olstein (Trades, Portfolio) added nine new positions to his portfolio in the third quarter. Of those, four were consumer defensive stocks: Walgreens Boots Alliance Inc. (NASDAQ:WBA), Kimberly-Clark Corp. (NYSE:KMB), Snyder’s-Lance Inc. (NASDAQ:LNCE) and Central Garden & Pet Co. (NASDAQ:CENTA).

Managing a portfolio of 112 stocks, the firm seeks long-term capital appreciation by looking “behind the numbers” of financial statements to assess a company’s financial strength and to determine potential downside risk. The portfolio is largely composed of stocks in the industrials and consumer cyclical sectors.

Walgreens

Having previously exited a position in Walgreens in first-quarter 2011, the guru established a new 49,000-share holding for an average price of $80.15 per share. The trade had an impact of 0.49% on the portfolio.

The Illinois-based drugstore chain has a market cap of $69.98 billion; its shares were trading around $69.32 on Thursday with a price-earnings (P/E) ratio of 18.36, a price-book (P/B) ratio of 2.61 and a price-sales (P/S) ratio of 0.62.

The Peter Lynch chart below shows the stock is trading above its fair value.

1510181052956.png

GuruFocus ranked Walgreens’ financial strength 6 of 10 and its profitability and growth 7 of 10. The company’s trailing dividend yield is 2.25%, and its forward dividend yield is 2.43%. The dividend payout ratio is 40%.

With 0.8% of outstanding shares, the Vanguard Health Care Fund (Trades, Portfolio) is Walgreens' largest guru shareholder. In the third quarter, Mario Gabelli (Trades, Portfolio) and Ken Fisher (Trades, Portfolio) added to their positions while John Hussman (Trades, Portfolio) trimmed his holding.

Kimberly-Clark

Olstein bought 30,000 shares of Kimberly-Clark for an average price of $122.23 per share, giving it 0.46% portfolio space. He previously exited a position in the company in the second quarter of 2012.

The Irving, Texas-based consumer packaged goods company has a market cap of $40.06 billion; its shares were trading around $113.88 on Thursday with a P/E ratio of 18.78, a P/B ratio of 154.72 and a P/S ratio of 2.23.

According to the Peter Lynch chart below, the stock is trading above its fair value.

1510182435377.png

GuruFocus ranked Kimberly-Clark’s financial strength 5 of 10 and its profitability and growth 6 of 10. The company’s trailing dividend yield is 3.38%, and its forward dividend yield is 3.47%. The payout ratio is 63%.

The company’s largest shareholder among the gurus is Diamond Hill Capital (Trades, Portfolio) with 0.66% of outstanding shares. The T Rowe Price Equity Income Fund (Trades, Portfolio) also established a stake during the third quarter.

Snyder’s-Lance

Olstein purchased 35,850 shares of Snyder’s-Lance for an average price of $36.01 per share, expanding the portfolio 0.18%.

The North Carolina-based manufacturer of snack foods has a market cap of $3.36 billion; its shares were trading around $34.73 on Thursday with a P/E ratio of 99.24, a P/B ratio of 1.81 and a P/S ratio of 1.57.

Based on the Peter Lynch chart below, the stock appears to be trading above its fair value.

1510183159646.png

GuruFocus ranked Snyder’s-Lance’s financial strength 5 of 10 and its profitability and growth 6 of 10. The company’s trailing dividend yield and forward dividend yield are both 1.85%. The payout ratio is 100%.

Gabelli is the company’s largest guru shareholder with 2.51% of outstanding shares. Fisher and Joel Greenblatt (Trades, Portfolio) are also shareholders.

Central Garden & Pet

Olstein invested in 27,321 shares of Central Garden & Pet for an average price of $33.02 per share, impacting the portfolio by 0.13%.

The California-based manufacturer of pet, garden and lawn care products has a market cap of $1.81 billion; its shares were trading around $34.28 on Thursday with a P/E ratio of 27.14, a P/B ratio of 2.94 and a P/S ratio of 0.92.

According to the Peter Lynch chart below, the stock is trading above its fair value.

1510239413399.png

GuruFocus ranked Central Garden and Pet’s financial strength 6 of 10 and its profitability and growth 6 of 10. The company does not pay a dividend.

With 2.15% of outstanding shares, Jim Simons (Trades, Portfolio) is the company’s largest guru shareholder. Greenblatt, Jeremy Grantham (Trades, Portfolio) and Paul Tudor Jones (Trades, Portfolio) also own the stock.

Big Lots

Olstein also exited one position in the consumer defensive sector: Big Lots Inc. (NYSE:BIG). He sold his remaining 97,710 shares for an average price of $49.2 per share, impacting the portfolio -0.6%. According to GuruFocus estimates, he gained approximately 13% on the investment since the third quarter of 2012.

The Ohio-based retailer has a market cap of $2.25 billion; its shares were trading around $53.01 on Thursday with a P/E ratio of 13.91, a P/B ratio of 3.81 and a P/S ratio of 0.44.

Based on the Peter Lynch chart below, the stock appears to be trading below its fair value.

1510240759536.png

GuruFocus ranked Big Lots’ financial strength 7 of 10 and its profitability and growth 8 of 10. The company’s trailing dividend yield is 1.81%, and its forward dividend yield is 1.87%. The payout ratio is 24%.

Richard Snow (Trades, Portfolio) is the company’s largest guru shareholder with 2.89% of outstanding shares. Simons, Barrow, Hanley, Mewhinney & Strauss, Steven Cohen (Trades, Portfolio), Jones, Greenblatt, Chuck Royce (Trades, Portfolio), Grantham and David Dreman (Trades, Portfolio) also own the stock.

Other positions Olstein established during the quarter include Janus Henderson Group PLC (NYSE:JHG), Willis Towers Watson PLC (NASDAQ:WLTW), Dunkin’ Brands Group Inc. (NASDAQ:DNKN), Omnicom Group Inc. (NYSE:OMC) and Chevron Corp. (NYSE:CVX).

Disclosure: I do not own any stocks mentioned.

About the author:

Sydnee Gatewood
I am an editorial assistant at GuruFocus. I have a BA in journalism and a MA in mass communications from Texas Tech University. I have lived in Texas most of my life, but also have roots in New Mexico and Colorado. Follow me on Twitter! @gurusydneerg

Rating: 0.0/5 (0 votes)

Comments

Please leave your comment:


Performances of the stocks mentioned by Sydnee Gatewood


User Generated Screeners


efredbac10yr Low PE
DANGORDON1-21-19 RET ON > 12% EQ AND CA
mathew94Insider Buys
cspunarJuniors 21Jan19
daftheaderasian growth plus dividend
DANGORDONTECH COS RATE OF RETURN
DANGORDONRETAIL COS RATE OF RETURN
hanley.newsfeedtesting
ripollj67Value,Hi ROIC
paulyew2003USA 1
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)

GF Chat

{{numOfNotice}}
FEEDBACK