Weitz Investment Management, the firm founded by Wallace Weitz (Trades, Portfolio), disclosed in a regulatory filing that its top trades during the fourth quarter of 2022 included boosts to its holdings of Microsoft Corp. (MSFT, Financial), Meta Platforms Inc. (META, Financial) and Oracle Corp. (ORCL, Financial). The firm also reduced to its positions in CoStar Group Inc. (CSGP, Financial) and MarketAxess Holdings Inc. (MKTX, Financial) and closed its position in Dun & Bradstreet Holdings Inc. (DNB, Financial).
The Omaha, Nebraska-based firm manages several funds, including the Weitz Value Fund and the Weitz Partners Value Fund. The firm combines Benjamin Graham’s price sensitivity and insistence on a margin of safety with a conviction that qualitative measures that allow the company to control its destiny may be more important than statistical measurements like book value and earnings.
As of December 2022, the firm’s $1.75 billion 13F equity portfolio contains 55 stocks with a quarterly turnover ratio of 2%. The top four sectors in terms of weight are financial services, communication services, technology and health care, representing 27.27%, 20.40%, 19.14% and 9.35% of the equity portfolio.
Investors should be aware 13F filings do not give a complete picture of a firm’s holdings as the reports only include its positions in U.S. stocks and American depository receipts, but they can still provide valuable information. Further, the reports only reflect trades and holdings as of the most-recent portfolio filing date, which may or may not be held by the reporting firm today or even when this article was published.
Microsoft
Weitz purchased 40,000 shares of Microsoft (MSFT, Financial), boosting the position by 195.12% and its equity portfolio by 0.55%.
Shares of Microsoft averaged $239.99 during the fourth quarter; the stock is modestly undervalued based on its price-to-GF Value ratio of 0.84 as of Friday.
The Redmond, Washington-based software giant has a GF Score of 97 out of 100 based on a rank of 10 out of 10 for profitability and growth, a GF Value rank of 9 out of 10, a financial strength rank of 8 out of 10 and a momentum rank of 5 out of 10.
Microsoft’s profitability ranks 10 out of 10 on several positive investing signs, which include a 3.5-star business predictability rank and an operating margin that has increased by approximately 7.5% per year on average over the past five years and is outperforming more than 97% of global competitors.
Other gurus with holdings in Microsoft include Bill Gates (Trades, Portfolio)’ foundation trust and Ken Fisher (Trades, Portfolio)’s Fisher Investments.
Meta Platforms
The firm added 70,550 shares of Meta Platforms (META, Financial), boosting the position by 16.71% and its equity portfolio by 0.49%. Despite this, the stock dropped to the firm’s 10th-largest holding, down from the its eighth-largest holding in the prior quarter.
Shares of Meta averaged $117.43 during the fourth quarter; the stock is significantly undervalued based on its price-to-GF Value ratio of 0.47 as of Friday.
The Menlo Park, California-based social media giant has a GF Score of 89 out of 100 based on a growth rank of 10 out of 10, a profitability rank of 9 out of 10, a financial strength rank of 7 out of 10 and a rank of 4 out of 10 for GF Value and momentum.
Meta’s profitability ranks 9 out of 10 on several positive investing signs, which include a three-star business predictability rank and an operating margin that outperforms approximately 86% of global competitors.
Oracle
The firm added 75,000 shares of Oracle (ORCL, Financial), boosting the position by 20.8% and its equity portfolio by 0.35%.
Shares of Oracle averaged $76 during the fourth quarter; the stock is fairly valued based on its price-to-GF Value ratio of approximately 1 as of Friday.
The Austin, Texas-based enterprise resource planning software company has a GF Score of 86 out of 100 based on a rank of 9 out of 10 for momentum and profitability, a growth rank of 8 out of 10, a GF Value rank of 5 out of 10 and a financial strength rank of 3 out of 10.
CoStar Group
The firm sold 141,900 shares of CoStar Group (CSGP, Financial), chopping 11.37% of the position and 0.59% of its equity portfolio.
Despite the reduction to the holding, the stock remains the firm’s third-largest holding with a 4.89% equity portfolio weight.
Shares of CoStar averaged $78.14 during the fourth quarter; the stock is modestly undervalued based on its price-to-GF Value ratio of 0.77 as of Friday.
The Northwest, Washington-based real estate services company has a GF Score of 96 out of 100 based on a rank of 10 out of 10 for growth and GF Value, a profitability rank of 9 out of 10, a financial strength rank of 8 out of 10 and a momentum rank of 6 out of 10.
MarketAxess Holdings
Weitz sold 38,000 shares of MarketAxess Holdings (MKTX, Financial), slicing 67.86% of the position and 0.50% of its equity portfolio.
Shares of MarketAxess Holdings averaged $257.38 during the fourth quarter; the stock is modestly undervalued based on its price-to-GF Value ratio of 0.71 as of Friday.
The New York-based fixed income trading company has a GF Score of 100 out of 100 based on a rank of 10 out of 10 for profitability, growth, GF Value and momentum and financial strength ranking 9 out of 10.
Dun & Bradstreet Holdings
Weitz sold all 713,383 shares of Dun & Bradstreet Holdings (DNB, Financial), trimming 0.53% of its equity portfolio. Shares averaged $12.83 during the fourth quarter.
The Jacksonville, Florida-based data and analytics company has a GF Score of 20 out of 100 based on a rank of 3 out of 10 for financial strength and profitability. Despite this, the company does not have enough data to compute ranks for growth, GF Value and momentum and thus, the GF Score may give an incomplete picture of the stock’s potential.
