According to the Aggregated Portfolio, a GuruFocus Premium feature, five most-broadly-held stocks from the manufacturing sector include Mohawk Industries Inc. (MHK, Financial), Hanesbrands Inc. (HBI, Financial), Whirlpool Corp. (WHR, Financial), PVH Corp. (PVH, Financial) and Capri Holdings Ltd. (CPRI, Financial).
Dow tumbles on weaker-than-expected manufacturing data
On Cyber Monday, the Dow Jones Industrial Average closed at 27,784.94, down 266.47 points from the Black Friday close of 28,051.41.
Institute of Supply Management Chairman Timothy Fiore said the November purchasing manager’s index stood at 48.1%, down 0.2% from the October reading of 48.3%. The three components of the PMI contracted, with demand declining due to low new orders and backlog.
Fiore than said that global trade remains a major cross-industry issue as the U.S. and China continue struggling to work out “phase one” of the trade deal. According to CNBC sources, Chinese newspaper Global Times said on Sunday that the U.S. “must remove existing tariffs, not planned tariffs, as part of the deal.” The U.S. administration is poised to impose an additional 15% tariff on approximately $156 billion of Chinese goods on Dec. 15.
Opportunities still exist in manufacturing sector despite contraction
Despite contraction in the manufacturing sector, gurus still broadly own companies in manufacturing sectors like apparel manufacturing, textile manufacturing and furnishings, fixtures and appliances. GuruFocus’ most-broadly-held portfolio has outperformed the Standard & Poor’s 500 Index benchmark in at least four of the past five years according to our model portfolio page.
Mohawk
Fourteen gurus own shares of Mohawk with a combined weighting of 13.10%. Gurus with large holdings in Mohawk include Ruane Cunniff (Trades, Portfolio) and Steven Romick (Trades, Portfolio).
The Calhoun, Georgia-based company manufactures a wide range of flooring products, including carpets, rugs, ceramic tile, laminate, wood and vinyl. GuruFocus ranks Mohawk’s profitability 7 out of 10 on several positive investing signs, which include a three-year revenue growth rate that outperforms 62.93% of global competitors and operating margins that have increased approximately 10.10% per year on average over the past five years.
Hanesbrands
Ten gurus own shares of Hanesbrands with a combined holding of 5.93%. Among the gurus, Diamond Hill Capital (Trades, Portfolio) has the largest stake with 15,480,013 shares.
The Winston-Salem, North Carolina-based company manufactures innerwear and activewear apparel under brands like Hanes, Champion and Maidenform. GuruFocus ranks Hanesbrands’ profitability 8 out of 10 on several positive investing signs, which include a strong Piotroski F-score of 7, expanding profit margins and a return on equity that outperforms 98.8% of global competitors.
Whirlpool
Ten gurus own shares of Whirlpool with a combined holding of 2.61%.
The Benton Harbor, Michigan-based company manufactures and markets a wide range of laundry appliances, refrigerators, freezers, cooking appliances and other home appliances. GuruFocus ranks Whirlpool’s profitability 7 out of 10: Even though the company’s operating margin outperforms just 51.34% of global competitors, its return on equity and Joel Greenblatt (Trades, Portfolio) return on capital both outperform more than 87% of global furniture, fixture and appliance companies.
PVH
Nine gurus own shares of PVH with a combined weight of 5.92%. Richard Snow (Trades, Portfolio) purchased 297,603 shares during the third quarter, increasing his position 607.81%.
The New York-based company manufactures apparel items through brands like Calvin Klein and Tommy Hilfiger. GuruFocus ranks PVH’s profitability 7 out of 10: Operating margins are outperforming just 64.44% of global competitors despite increasing approximately 4% per year on average over the past five years.
Capri Holdings
Nine gurus own shares of Capri Holdings with a combined weight of 1.04%.
The London-based company manufactures apparel, footwear and accessories through brands like Michael Kors and Jimmy Choo. Chairman and CEO John Idol said on Feb. 6 the company renamed itself Capri Holdings following its acquisition of Versace.
GuruFocus ranks Capri Holdings’ profitability 8 out of 10: Operating margins are outperforming approximately 88% of global competitors despite contracting approximately 12% per year on average over the past five years.
Disclosure: No positions.
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