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James Li
James Li
Articles (464)  | Author's Website |

Third Avenue Management Hitches Up With U-Haul Parent Amerco in 4th Quarter

Firm announces three new buys in latest quarterly report

February 14, 2018 | About:

Third Avenue Management (Trades, Portfolio), founded by legendary value investor Martin Whitman (Trades, Portfolio), announced Wednesday it established three new positions during the quarter ended Dec. 31: Amerco Inc. (NASDAQ:UHAL), Warrior Met Coal Inc. (NYSE:HCC) and Aspen Insurance Holdings Ltd. (NYSE:AHL).

Amerco

Whitman’s firm invested in 55,286 shares of Amerco for an average price of $374.04 per share. The firm increased its portfolios 1% with this transaction.

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Amerco, the holding company of well-known rental truck dealer U-Haul, said self-moving equipment revenues increased $33.3 million during the quarter, driven primarily by higher transaction and rental revenues. Self-storage revenues increased $9.8 million primarily due to higher rates per square foot and occupancy gains at existing locations. Increased revenues across Amerco’s reporting segments led to a consolidated revenue increase of approximately $52.43 million from the prior-year quarter.

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Firms other buys

Third Avenue invested in 686,383 shares of Warrior Met Coal for an average price of $25.14 per share and 158,707 shares of Aspen Insurance Holdings for an average per-share price of $41.36. With these transactions, the firm increased its portfolios 1.14% in the aggregate.

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Warrior Met Coal produces and exports metallurgical coal for the steel industry. The company has a strong financial strength rank of 8, driven primarily by robust Altman Z-scores and interest coverage.

Warrior CEO Walt Scheller said the company’s strong fourth-quarter results enabled it to “exceed [management’s] full-year guidance” on key sales and production metrics. The company produced 1.6 million short tons of met coal during the quarter, up 52% from the production levels in the prior-year quarter. The strong results contributed to profit margins outperforming over 90% of global competitors in the coal industry.

Aspen

Unlike Warrior, Aspen has profit margins that underperform 86% of its global competitors in the reinsurance industry. Additionally, Aspen’s revenue has declined over the past 12 months, suggesting lower growth potential than its competitors.

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Disclosure: No positions.

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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