Value Investment Firm Modifies Holdings with New Buys, Increases, and Reductions
Hotchkis & Wiley, a Los Angeles-based investment firm established in 1980, is renowned for its value investment strategy. The firm's approach is centered on identifying undervalued companies with the potential for significant appreciation, focusing on tangible assets, sustainable cash flow, and the potential for business performance improvement. Their latest 13F filing for the third quarter of 2023 offers a window into their investment decisions during a dynamic market period.
New Additions to the Portfolio
Hotchkis & Wiley expanded its portfolio with 59 new stock additions in the third quarter. Noteworthy new buys include:
- Discover Financial Services (DFS, Financial), purchasing 1,274,920 shares, which now represents 0.42% of the portfolio, valued at $110.45 million.
- Bank of America Corp (BAC, Financial), adding 3,692,300 shares, making up approximately 0.38% of the portfolio, with a total value of $101.1 million.
- General Dynamics Corp (GD, Financial), acquiring 448,030 shares, accounting for 0.38% of the portfolio, valued at $99 million.
Significant Position Increases
The firm also raised its stakes in 202 stocks, with the most significant increases being:
- Telefonaktiebolaget L M Ericsson (ERIC, Financial), with an additional 37,316,550 shares, bringing the total to 141,934,904 shares. This represents a 35.67% increase in share count, a 0.69% impact on the current portfolio, and a total value of $689.8 million.
- GE HealthCare Technologies Inc (GEHC, Financial), with an additional 2,577,478 shares, bringing the total to 5,040,063 shares. This adjustment marks a 104.67% increase in share count, with a total value of $342.9 million.
Exiting Positions
Hotchkis & Wiley completely exited 72 holdings in the third quarter of 2023, including:
- Thor Industries Inc (THO, Financial), selling all 291,115 shares, which had a -0.11% impact on the portfolio.
- Capri Holdings Ltd (CPRI, Financial), liquidating all 571,640 shares, causing a -0.08% impact on the portfolio.
Notable Reductions in Holdings
The firm reduced its position in 188 stocks. The most significant reductions include:
- Workday Inc (WDAY, Financial), with a reduction of 893,973 shares, resulting in a -49.54% decrease in shares and a -0.75% impact on the portfolio. The stock traded at an average price of $231.89 during the quarter and has seen a -0.11% return over the past three months and a 35.19% year-to-date return.
- FedEx Corp (FDX, Financial), with a reduction of 567,169 shares, leading to a -25.03% decrease in shares and a -0.52% impact on the portfolio. The stock's average trading price was $259.97 during the quarter, with a -7.30% return over the past three months and a 43.85% year-to-date return.
Portfolio Overview
As of the third quarter of 2023, Hotchkis & Wiley's portfolio comprised 478 stocks. The top holdings included 3.37% in F5 Inc (FFIV, Financial), 3.26% in American International Group Inc (AIG, Financial), 3.09% in Wells Fargo & Co (WFC, Financial), 2.86% in APA Corp (APA, Financial), and 2.85% in Citigroup Inc (C, Financial).
The firm's investments are primarily concentrated across all 11 industries, with significant allocations in Financial Services, Technology, Energy, Industrials, Healthcare, Consumer Cyclical, Communication Services, Utilities, Basic Materials, Consumer Defensive, and Real Estate.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
