Agilent Technologies Inc $ 114.35 -0.33 (-0.29%)
A News and Headlines - Agilent Technologies Inc
The guru's New York-based hedge fund takes large positions in underperforming companies with the intent of pushing management to make changes. This activist strategy allows the hedge fund to unlock value for shareholders.
At the end of the quarter, the portfolio contained seven stocks, with no new additions. Overall, it is valued at $8.82 billion and it has seen a turnover rate of zero percent. Top holdings at the end of the quarter include Lowe's Companies
Agilent's fiscal third quarter results were demonstrative of the company's high-quality, resilient business model and significant margin expansion opportunity. In what the company expects to be its most challenging quarter of the year, organic revenue declined only 3%, supported by stable performance in its CrossLab service and consumables segment, which grew 1%. While the pace of recovery throughout the quarter varied by region depending on when each region faced the brunt of the pandemic, the company exited July with positive growth across all of its regions. Notably, even with a modest revenue decline, the company was able to
To the Shareholders of Pershing Square Holdings, Ltd.:
Pershing Square Holdings generated strong performance during the first half of 2020 and year-to-date,5 as our NAV total return per share increased 28.9% and 44.1%6 respectively, compared with the S&P's half-year and year-to-date total return of -3.1% and 7.9%.3 Our strong absolute and relative performance was driven by our late February and early March hedging program in the index CDS markets, the subsequent unwinding of that hedge beginning on March 12th, and the contemporaneous reinvestment of nearly all of the gains from hedging by March 18th, which allowed us to take advantage
The guru’s New York-based hedge fund is known for taking large positions in a handful of underperforming companies and pushing for change in order to unlock value for shareholders. One of Ackman’s most well-known activist targets in recent years, which did not end well for him, was Valeant Pharmaceuticals.
Ackman’s most notable trades for the three months ended March 31 included new positions in Blackstone Group Inc. (BX) and Park Hotels & Resorts Inc. (PK), as well as significant increases
According to its December update, Ackman's hedge fund, Pershing Square Holdings, gained 4.5% in December, bringing its 2019 net performance to 58.1%.
Ackman's run of good luck has continued into 2020. As of the beginning of this month, Pershing Square was up more than 17%. That's compared to a double-digit decline for the S&P 500 over the same period.
Ackman hit the headlines back in March
The S&P 500 Index has grown its annual earnings per share by about 7.2% on average every year over the past five years. The share price of the index has grown by nearly 35% over the past five years to close at $2,848.42 on May 6.
Thus, investors may be interested in Ferguson PLC (FERGY), Agilent Technologies Inc (A) and McCormick & Co Inc (MKC), as these holdings have grown their earnings per share (EPS) without non-recurring items (NRI) by an annual rate of more than 7.2% over the past five years.
The British global distributor of
Jerome Dodson (Trades, Portfolio)’s Parnassus Fund recently disclosed its portfolio updates for the first quarter of 2020. The turnover rate for the quarter was 25%; the fund sold out of its common stock holdings in 11 companies and established new holdings in eight companies.
The Parnassus Fund’s strategy is to seek long-term capital appreciation through securities that have wide moats, relevancy over the long term, quality management teams and a market price below intrinsic value. It is a contrarian fund that focuses on out-of-favor companies, with the exclusion of those involved in the production of fossil fuels.
As a provider of testing equipment for labs around the globe, Agilent (A) is well positioned to benefit from increasing investments in healthcare, safety-related testing, pharmaceuticals, and other industries where highly accurate testing is essential for environmental, safety, product design, quality control, and other reasons. In the short term, Agilent will be aff ected somewhat by the recent closure of university labs, generally lower global business activity, and the impact of lower energy prices on a small portion of the company’s customer base. In sum, we believe the net impact of the virus on Agilent’s longterm intrinsic value
To the Shareholders of Pershing Square Holdings, Ltd.:
2019 was an extraordinary year for PSH. We generated our best NAV returns in Pershing Square Capital Management, L.P.’s 16-year history with a total NAV return including dividends of 58.1%, and a total stock price return of 51.2%.5 2019 was also an excellent year for our portfolio companies as their operating and business progress largely kept pace with their stock price returns. We made two new investments, Agilent (A) and Berkshire Hathaway (BRK.A)(BRK.B), and exited three positions. We incurred no markto-market or realized losses on any of our holdings in 2019,
The fund, which is part of Jerome Dodson (Trades, Portfolio)’s San Francisco-based Parnassus Investments, avoids investing in fossil fuel-related stocks. Rather, it prefers companies that have exemplary work environments and are known for being socially and environmentally responsible. With the goal of capital appreciation, the portfolio managers invest in discounted large-cap companies that have strong competitive advantages, relevant products and quality management teams.
With these criteria in mind, the fund established positions in FedEx Corp. (FDX), VF
Dear Pershing Square Investor,
On March 3, 2020, we disclosed that we had acquired large notional hedges which have asymmetric payoff characteristics; that is, the risk of loss from these hedges was limited, while their potential upside was many multiples of our capital at risk. We did so because of our concern about the negative effect of the coronavirus on the U.S. and global economies, and on equity and credit markets. Below, we summarize the events that have taken place since the initiation of the hedges that have led us to unwind them using the proceeds to increase our exposure
According to the GuruFocus All-In-One Screener, a Premium feature, the following companies were trading with low price-sales ratios as of March 3.
Saratoga Investment Corp. (SAR) was trading around $24.5 per share with a price-sales ratio of 4.96 and a price-earnings ratio of 5.8.
The specialty finance company has a market cap of $280 million. The stock has risen at an annualized rate of 9.9% over the past decade.
The discounted cash flow calculator gives the company a fair value of $46.12, suggesting it is undervalued with a 45% margin of
Founded by Ackman in 2004, Pershing Square focuses on taking large stakes in a small number of well-researched companies that it deems to be fundamentally strong but underperforming in the short term. After obtaining a large enough position of influence as a major shareholder, preferably enough to get board representation, the hedge fund then aims to catalyze improvements in the target company’s strategy in order to further increase its expected profitability.
As of the quarter’s end,
The activist guru’s New York-based hedge fund is known for taking large positions in underperforming companies and pushing for change in order to unlock value for shareholders.
According to Real-Time Picks, a Premium feature of GuruFocus, the guru sold 215,378 shares of the fast-casual restaurant chain, which was its best-performing holding in 2019, on Feb. 7. He now holds 1.5 million shares, which represent 20.69% of his firm’s equity portfolio and 5.43%
The Parnassus Endeavor Fund (Trades, Portfolio), which is part of Jerome Dodson's firm that provides responsible investment funds to the public, acquired shares of the following stocks during the fourth quarter.
The fund boosted its Cisco Systems Inc. (CSCO) stake by 500%. The portfolio was impacted by 5.03%.
The company, which provides data networking equipment and software, has a market cap of $202.74 billion and an enterprise value of $193.20 billion.
GuruFocus gives the company a profitability and growth rating of 10 out of 10. The return on equity
The fund, which is part of Jerome Dodson (Trades, Portfolio)’s San Francisco-based Parnassus Investments, avoids investing in fossil fuel-related stocks. Rather, it concentrates on companies that have exemplary work environments and are socially and environmentally responsible. With the goal of capital appreciation, the portfolio managers invest in discounted large-cap companies that have strong competitive advantages, relevant products or services and quality management teams.
Based on these criteria, the fund established positions in Progressive Corp. (PGR) and Expeditors
Massachusetts-based Waters Corp. (WAT) is a pioneer of analytical workflow solutions involving liquid chromatography, mass spectrometry and thermal analysis innovations serving the life, materials and food sciences. The company’s specialty measurement products are often applied to discovering new pharmaceuticals, assuring food/water safety and ensuring the integrity of chemical production.
Pharma represents the most extensive customer segment for Waters with a revenue share of 56% as of fiscal 2018. Global drugmakers like Bristol-Myers Squibb (BMY) and Pfizer (PFE) depend on Waters' analytical technologies throughout their R&D and manufacturing processes. The U.S., China and Japan are
Ackman’s firm buys the stock of public companies at a discount and pushes for change so that the market recognizes its value.
Transaction details and company background
According to a filing with the Securities and Exchange Commission, Pershing Square purchased 2,916,103 shares of Agilent, giving the position 3.44% weight in the equity portfolio. Shares averaged $72.2 during the quarter.
As part of Jerome Dodson (Trades, Portfolio)’s San Francisco-based firm, the fund avoids fossil fuel-related stocks. Rather, it concentrates on companies that have exemplary work environments and are socially and environmentally responsible. With the goal of capital appreciation, the fund invests in discounted large-cap companies that have strong competitive advantages, relevant products or services and quality management teams.
Based on these criteria, the Endeavor Fund established positions in Arista Networks Inc. (ANET), W.W. Grainger Inc. (GWW), Agilent
According to Benjamin Graham's financial strength criterion, if investors screen for stocks whose current ratio is more than 2 and has higher working capital than long-term debt, they should find high-quality companies.
These companies can outperform most of their competitors during any phase of the business cycle.
The current ratio, which is calculated as total current assets divided by total current liabilities, gauges the company's ability to pay short-term financial obligations.
The working capital ratio, which is calculated as total current asset minus total current liabilities, measures the ability of the company to continue to operate its business fluently and