Bestinfond (Trades, Portfolio), formerly run by top Spanish investor Francisco Garcàa Paramés(Trades, Portfolio), disclosed last week its top five buys for fourth-quarter 2018 were BNP Paribas (XPAR:BNP, Financial), Diageo PLC (LSE:DGE, Financial)(DEO, Financial), GlaxoSmithKline PLC (LSE:GSK, Financial)(GSK, Financial), ABB Ltd. (XSWX:ABBN, Financial) and Valeo SA (XPAR:FR, Financial).
Managed by Beltran de la Lastra, Bestinfond seeks long-term capital appreciation through key investing principles shared by legendary investors like Benjamin Graham, Warren Buffett (Trades, Portfolio) and Seth Klarman (Trades, Portfolio). Bestinver, the firm that manages Bestinfond, identifies companies where the real value exceeds the market price.
According to current portfolio statistics, the fund’s top sectors in terms of portfolio weight are industrials, consumer cyclical and financial services. Industrials make up 27.01% of the equity portfolio while consumer cyclical occupies 25.67%.
BNP Paribas
De la Lastra disclosed the fund owned 560,208 shares of BNP Paribas at quarter-end. Shares of the French bank averaged 45.29 euros ($51.78) during the quarter.
BNP Paribas offers a wide variety of financial services, including personal finance, international retail banking and wealth management. GuruFocus ranks the bank’s financial strength 4 out of 10: while the bank’s cash-to-debt ratio is greater than 1, suggesting the ability to pay debt with cash on hand, BNP Paribas’ debt-to-equity ratio of 1.73 ranks lower than European banks.
Other gurus with large holdings in BNP Paribas include David Herro (Trades, Portfolio) and Sarah Ketterer (Trades, Portfolio)’s Causeway International Value (Trades, Portfolio) Fund.
Diageo PLC
De la Lastra invested in 508,902 shares of Diageo for an average price of 27.41 pounds ($35.75) per share. The fund manager increased his equity portfolio 1.13% with this transaction.
U.K.-based Diageo produces and supplies alcoholic beverages, including well-known brands like Johnnie Walker and Crown Royal. Diageo said in its January report that revenues for the six months ending Dec. 31, 2018 were 6.9 billion pounds (approximately $9 billion), up 5.8% from the six months ending Dec. 31, 2017. Strong organic growth across the company’s regions and business segments contributed to a three-year revenue growth rate that outperforms 70% of global competitors.
GuruFocus ranks the company’s profitability 8 out of 10 on several positive signs, which include expanding profit margins and a strong Piotroski F-score of 7. Additionally, Diageo’s business predictability ranks three stars out of five on consistent revenue and earnings growth over the past 10 years.
Gurus that own American depository receipt (ADR) shares of Diageo include Bill Nygren (Trades, Portfolio), Tom Gayner (Trades, Portfolio) and Jim Simons (Trades, Portfolio).
GlaxoSmithKline
De la Lastra invested in 924,764 shares of GlaxoSmithKline for an average price of 15.18 pounds per share. The fund manger increased his equity portfolio 1.09% with this transaction.
U.K.-based GlaxoSmithKline manufactures and markets a wide range of pharmaceutical products, including respiratory and antiviral medicines. GuruFocus ranks the company’s profitability 7 out of 10: even though profit margins have declined, GlaxoSmithKline’s operating margin and return on equity still outperform 84% and 99% of global drug manufacturers.
ABB
De la Lastra invested in 883,861 shares of ABB for an average price of 20.18 Swiss francs ($20.22) per share. The fund manager increased his equity portfolio 1% with this transaction.
The Swiss diversified industrials company engages in operations that seek to boost industrial productivity, increase power grid reliability and enhance energy efficiency. GuruFocus ranks the company’s profitability 6 out of 10: although the company’s return on equity outperforms 80% of global competitors, ABB’s three-year revenue growth rate of -2.30% ranks lower than 71% of global competitors.
Valeo
De la Lastra invested in 549,196 shares of Valeo for an average price of 27.27 euros per share. The fund manager increased his equity portfolio 0.97% with this transaction.
The French auto parts manufacturer operates five business segments: comfort and driving assistance systems; powertrain systems; thermal systems; visibility systems; and aftermarket services. GuruFocus ranks the company’s profitability 7 out of 10 primarily due to expanding profit margins: Valeo’s operating margin is near a 10-year high of 7.84% and ranks higher than 63% of global competitors.
See also
We are pleased to have Paramés at our upcoming value conference. The former manager of Bestinfond’s track record of 25 years near the top of performance rankings makes him one of Europe’s top value investors. Join Paramés, Mario Gabelli (Trades, Portfolio) and keynote speaker Chuck Royce (Trades, Portfolio) at our May 3 conference by registering now.
Disclosure: No positions.
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