Royce & Associates leader Chuck Royce (Trades, Portfolio) disclosed this week his firm reduced its position in IXYS Corp. (IXYS, Financial) and increased its Circor International Inc. (CIR, Financial) holding on Nov. 30.
With a portfolio of 1,234 holdings, Royce's firm focuses on investments in the small-cap space. The current portfolio is largely composed of industrial stocks at 26.6%. In 2016, the Premier Fund returned 23%, outperforming the S&P 500’s return of 11.96%.
IXYS
According to GuruFocus real-time picks, the guru trimmed his IXYS position 67.08%, selling 506,511 shares for an average price of $24.05 per share. The trade has an impact of -0.08% on the portfolio. GuruFocus estimates Royce has gained 63% on the investment since the first quarter of 2011.
The California-based semiconductor manufacturer has a market cap of $781.54 million; its shares were trading around $23.85 on Friday with a price-earnings (P/E) ratio of 33.59, a price-book (P/B) ratio of 2.42 and a price-sales (P/S) ratio of 2.35.
Based on the Peter Lynch chart below, the stock appears to be trading above its fair value.
GuruFocus ranks IXYS’ financial strength 7 of 10 and its profitability and growth 5 of 10. The company does not currently pay a dividend.
In August, Littelfuse Inc. (LFUS, Financial) announced it is acquiring IXYS in a cash and stock deal valued at $655 million. The deal is expected to close in the first calendar quarter of 2018.
Of the gurus invested in IXYS, Jim Simons (Trades, Portfolio) has the largest position with 2.75% of outstanding shares. Keeley Asset Management Corp (Trades, Portfolio) and Mario Gabelli (Trades, Portfolio) are also shareholders.
Circor International
Royce increased his Circor position by 6.72%, buying 103,944 shares for an average price of $48.49. The transaction had an impact of 0.03% on the portfolio. GuruFocus estimates the guru has lost 4% on the investment since the second quarter of 2013.
The Massachusetts-based industrial company has a market cap of $774.7 million; its shares were trading around $46.95 on Friday with a P/E ratio of 50.46, a P/B ratio of 1.72 and a P/S ratio of 1.26.
According to the Peter Lynch chart below, the stock is trading above its fair value.
GuruFocus ranked Circor’s financial strength 6 of 10 and its profitability and growth 4 of 10. The company’s trailing dividend yield and forward dividend yield are both 0.32%. The dividend payout ratio is 16%.
In its third-quarter earnings report on Oct. 27, Circor recorded $160 million in revenue, a 13% increase from the prior-year quarter. Adjusted earnings came in at 43 cents per share.
With 10% of outstanding shares, Royce is Circor’s largest guru shareholder. Gabelli and PRIMECAP Management (Trades, Portfolio) also own the stock.
Disclosure: I do not own any stocks mentioned.
