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
Holly LaFon
Holly LaFon
Articles (9703)  | Author's Website |

Mohnish Pabrai Triples Stake in Micron Technology

Pabrai Funds founder expands only US stock holding

May 14, 2019 | About:

Mohnish Pabrai (Trades, Portfolio), the managing partner of Pabrai Funds, expanded his U.S. holdings in the first quarter by tripling his holding of Micron Technology (NASDAQ:MU).

Pabrai moved the vast majority of his portfolio into India, Turkey and South Korea after he began having difficulty finding adequate businesses in the U.S. market. Semiconductor memory company Micron is his only U.S. investment out of the roughly $1 billion he manages across all his funds.

The investor found Micron while searching through the publication Value Line hunting for stocks with low price-earnings ratios, he told GuruFocus in an interview in March. At the time, Micron was among the lowest price-earnings ratio stocks of the 1,700-stock universe.

“So I noticed this very low P/E, and then a fund manager friend of mine mentioned that he owned the stock. And so I said, ‘Okay, this person isn't exactly an idiot, so why don't I drill down and just see what's going on with Micron?’ And when I drilled down, I decided it was worth taking a position,” he said.

In the first quarter, Pabrai increased his position in Micron Technology by 210.74%, buying 1,152,418 shares. He ended the quarter with 1,699,265 shares, equivalent to 0.15% of the $42.59 billion market cap company.

e5992fb0-768b-11e9-823a-5b72cb9eb390.png

Micron stock had an average price of around $39 per share in the first quarter. Pabrai started his position in the fourth quarter when the price averaged $38. The stock’s price has climbed almost 18% year to date, trading around $38.46 on Tuesday afternoon.

1764415788.png

Micron has a price-earnings ratio of 3.53, price-book ratio of 1.27 and price-sales ratio of 1.55.

Several other prominent investors have large positions in the stock as well. At the end of the fourth quarter, David Tepper (Trades, Portfolio) of Appaloosa Management had roughly 25.48% of his public equity portfolio invested in Micron, with 1.43% of its outstanding shares. He reduced the holding by more than half in the fourth quarter. A media-averse value firm, Primecap Management, has the largest position of investors GuruFocus tracks, with 5.22% of its outstanding shares. It started trading in the company before the first quarter of 2009, when the price averaged around $4 per share.

Pabrai has one other U.S.-listed stock, Fiat Chrysler Automobiles NV (NYSE:FCAU), which has its headquarters in the U.K. According to his portfolio update, Pabrai boosted that position by 0.05% in the first quarter, adding 6,657 shares. He ended the quarter with 13,105,047 shares of the company, equaling 1.08% of its outstanding shares.

39f18ee0-768c-11e9-92d7-fbbbfa00e4cd.png

The stock’s price averaged $15 for the quarter. Pabrai started a position in the fourth quarter of 2014 when it averaged $11. Year to date, shares of Fiat Chrysler climbed 4.23% to $14.52 Tuesday afternoon.

See Mohnish Pabrai (Trades, Portfolio)’s portfolio here.

Read more here:

Bill Smead's Value Fund Buys 2 and Sells 2 Stocks in 1st Quarter

Best Quotes From Warren Buffett’s 2019 Annual Shareholder Meeting (Part 2)

Best Quotes From Warren Buffett’s 2019 Annual Shareholder Meeting

Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.

About the author:

Holly LaFon
I'm a financial journalist with a Master of Science in journalism from Medill at Northwestern University.

Visit Holly LaFon's Website


Rating: 5.0/5 (3 votes)

Voters:

Comments

Valuator
Valuator - 1 week ago    Report SPAM

People don't change He's setting himself up for a dot com redux.

There are no good value investors anymore except me of course, even Buffett.

bbatts
Bbatts premium member - 1 week ago

dot com redux? The dot com bubble popped since most of the dot com companies weren't making any money, which caught up with them. That is not the case for Micron. Don't take my word for it. Do your DD and you'll see.

Valuator
Valuator - 1 week ago    Report SPAM

You have no idea what caused or popped the dot com bubble because you're a value investor, and value investors don't believe in economics.

You clearly haven't done your doodoo. Most people have to learn the hard way, but most people just don't learn. Actually, in the case of value investors, they turn to vinegar with age unless they have a way to prevent brain aging like moi.

The market hasn't changed at all since the old days. Everyone's just worse at it, yet no one knows why except me.

tokyowalker
Tokyowalker premium member - 1 week ago

can't tell if troll or idiot, or maybe both?

Valuator
Valuator - 1 week ago    Report SPAM

No, you're definitely an idiot.

Keep aspiring to barely beating the market.

Please leave your comment:


Performances of the stocks mentioned by Holly LaFon


User Generated Screeners


pjmason14Momentum
pascal.van.garsseHigh FCF-M2
kosalmmuse6
kosalmmuseBest one1
DBrizanall 2019Feb26
kosalmmuseBest one
DBrizanall 2019Feb25
kosalmmuseNice
kosalmmusehan
MsDale*52-Week Low
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