Yacktman Asset Management (Trades, Portfolio) disclosed this week that although it introduced two new holdings during the third quarter, the firm’s top three position boosts in terms of portfolio impact came in the form of additions to its holdings in Macy’s Inc. (M, Financial), News Corp. (NWSA, Financial) and State Street Corp. (STT, Financial).
Managed by Stephen Yacktman, the firm employs a disciplined investment strategy. Yacktman seeks companies with a good business, shareholder-oriented management and low purchase price. The firm’s approach combines growth investing and value investing.
As of quarter-end, the firm’s $8.14-billion equity portfolio contains 48 stocks, including new positions in MSC Industrial Direct Co. Inc. (MSM, Financial) and Spark Networks SE (LOV, Financial). The firm’s top three sectors in terms of weight are consumer staples, consumer discretionary and technology.
Firm’s new buys
The firm purchased 185,182 shares of MSC Industrial Direct, giving the position 0.17% weight in the equity portfolio. Shares traded at an average price of $70.06 during the quarter.
The Melville, New York-based company engages in metalworking, maintenance, repair and operations products and services. GuruFocus ranks MSC Industrial Direct’s profitability 8 out of 10 on several positive investing signs, which include consistent revenue growth and profit margins that are outperforming over 87% of global competitors.
The firm also purchased 220,000 shares of Spark Networks SE, giving the position 0.01% weight in the equity portfolio. Share price averaged $8.21 during the quarter.
Macy’s Inc.
The firm added 12,705,052 shares of Macy’s, increasing the existing position by 114.91% and impacting the equity portfolio 2.43%. Share price averaged $18.50 during the quarter.
The Cincinnati-based company operates department stores under brands like Macy’s, Bloomingdale’s and Bluemercury. GuruFocus ranks the company’s profitability 7 out of 10. Even though the company’s three year revenue decline rate of 0.50% underperforms 61.04% of global competitors, Macy’s has a return on equity that outperforms over 79% of global apparel and specialty retail companies.
News Corp
The firm added 9,623,733 shares of News Corp., increasing the position by 635.95% and impacting the equity portfolio 1.65%. Shares averaged $13.66 during the quarter.
The New York-based company operates platforms like the Wall Street Journal and the New York Times. GuruFocus ranks the company’s financial strength 7 out of 10 on several positive indicators, which include debt ratios that outperform over 68% of global competitors.
State Street
The firm added 1,661,988 shares of State Street, increasing the position by 63.05% and impacting the equity portfolio 1.21%.
The Boston-based asset management company provides financial services to institutional investors, including investment servicing, investment management and investment research and trading. According to GuruFocus, State Street’s equity-to-asset ratio of 0.1 underperforms 92.32% of global competitors, suggesting low financial strength. Additionally, the website warns that State Street’s long-term debt has increased by approximately $2.4 billion over the past three years.
Disclosure: No positions.
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