Capital Growth Management co-founder Ken Heebner (Trades, Portfolio) initiated 21 new positions in the third quarter. Among these, he invested in five basic materials stocks: The Chemours Co. (CC, Financial), POSCO (PKX, Financial), Anglo American PLC (NGLOY, Financial), Builders FirstSource Inc. (BLDR, Financial) and Norbord Inc. (OSB, Financial).
As the name of his firm suggests, Heebner is a growth-oriented investor. Managing a fairly concentrated portfolio of 53 stocks, he invests largely in the financial services, consumer cyclical and basic materials sectors.
Chemours
Heebner purchased 770,000 shares of Chemours for an average price of $47.08 per share, giving it 1.71% portfolio space.
The Delaware-based chemical company has a market cap of $9.5 billion; its shares were trading around $51.31 on Friday with a price-earnings (P/E) ratio of 35.63, a price-book (P/B) ratio of 11.86 and a price-sales (P/S) ratio of 1.64.
The Peter Lynch chart below shows the stock is trading above its fair value.
GuruFocus ranked Chemours’ 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 0.24%. The dividend payout ratio is 8%.
Of the nine gurus invested in Chemours, David Einhorn (Trades, Portfolio) has the largest position with 1.95% of outstanding shares. Mario Gabelli (Trades, Portfolio) also established a position in the third quarter.
POSCO
The investor bought 420,000 shares of POSCO for an average price of $71.73 per share, expanding the portfolio 1.28%.
The South Korean steel producer has a market cap of $22.88 billion; its shares were trading around $72.35 on Friday with a P/E ratio of 12.69, a P/B ratio of 0.60 and a P/S ratio of 0.45.
According to the Peter Lynch chart below, the stock is trading slightly below its fair value.
GuruFocus ranked POSCO’s financial strength 6 of 10 and its profitability and growth 5 of 10. The company’s trailing dividend yield is 2.69%, and its forward dividend yield is 2.89%. The payout ratio is 38%.
Charles Brandes (Trades, Portfolio) is POSCO’s largest guru shareholder with 0.29% of outstanding shares. Sarah Ketterer (Trades, Portfolio), NWQ Managers (Trades, Portfolio), Prem Watsa (Trades, Portfolio), Richard Pzena (Trades, Portfolio), Jim Simons (Trades, Portfolio), Francis Chou (Trades, Portfolio) and Charlie Munger (Trades, Portfolio) also own the stock.
Anglo American
Having previously exited a position in Anglo American in the second quarter, Heebner established a 1.57 million-share stake for an average price of $8.19 per share. The trade had an impact of 0.63% on the portfolio.
The U.K.-based miner has a market cap of $27.39 billion; its shares were trading around $9.89 on Friday with a P/E ratio of 6.37, a P/B ratio of 1.25 and a P/S ratio of 1.14.
Based on the Peter Lynch chart below, the stock appears to be trading below its fair value.
GuruFocus ranked Anglo American’s financial strength 6 of 10 and its profitability and growth 5 of 10. The company’s trailing dividend yield is 2.44%, and its forward dividend yield is 4.81%.
With his purchase, Heebner became the company’s largest guru shareholder with 0.06% of outstanding shares. Ken Fisher (Trades, Portfolio) also owns the stock.
Builders FirstSource
Heebner invested in 35,000 shares of Builders FirstSource for an average price of $16.09 per share, giving it a portfolio weight of 0.03%.
The Dallas-based provider of building materials has a market cap of $2.09 billion; its shares were trading around $18.52 on Friday with a P/E ratio of 12.27, a P/B ratio of 5.68 and a P/S ratio of 0.32.
According to the Peter Lynch chart below, the stock is trading below its fair value.
GuruFocus ranked the company’s financial strength 4 of 10 and its profitability and growth 6 of 10. The company does not pay a dividend.
Among the 10 gurus invested in Builders FirstSource, Ruane Cunniff (Trades, Portfolio) has the largest holding with 4.8% of outstanding shares. Fisher also established a position in the third quarter.
Norbord
The guru bought 10,000 shares of Norbord for an average price of $34.56 per share, expanding the portfolio 0.02%.
The Canadian manufacturer of wood-based panels has a market cap of $3.1 billion; its shares were trading around $35.8 on Friday with a P/E ratio of 9.13, a P/B ratio of 3.63 and a P/S ratio of 1.47.
The Peter Lynch chart below shows the stock is trading below its fair value.
GuruFocus ranked Norbord’s financial strength 6 of 10 and its profitability and growth 7 of 10. The company’s trailing dividend yield is 2.17%, and its forward dividend yield is 5.18%. The payout ratio is 20%.
With 0.07% of outstanding shares, Simons is the company’s largest guru shareholder. Brandes also owns the stock.
Other new positions Heebner established during the quarter include Norwegian Cruise Line Holdings Ltd. (NCLH, Financial), Carnival Corp. (CCL, Financial), DDR Corp. (DDR, Financial), American Tower Corp. (AMT, Financial) and Invitation Homes Inc. (INVH, Financial).
Disclosure: I do not own any stocks mentioned.
