Gates Capital Management, Inc. recently filed their 13F report for the third quarter of 2022, which ended on 2022-09-30.
The 13F report details which stocks were in a guru’s equity portfolio at the end of the quarter, though investors should note that these filings are limited in scope, containing only a snapshot of long positions in U.S.-listed stocks and American depository receipts as of the quarter’s end. They are not required to include international holdings, short positions or other types of investments. Still, even this limited filing can provide valuable information.
Gates Capital Management, Inc. is an investment management firm based out of New York, New York. The company was originally established in 1996 by founder Jeffrey L. Gates, who continues to have an active role in the company acting as its managing partner and president. Gates Capital Management conducts its research internally and invests in the public equity, alternative, and fixed income markets on a global scale. The company utilizes a “systematic, risk averse and event-driven” approach, focusing on identifying risk and reward relationships in its investments. Gates Capital Management invests most heavily in the materials and consumer discretionary sectors, which each make up over a quarter of its total asset allocations, and also invests in the industrials, consumer staples, health care, and real estate sectors, in order of decreasing allocation. The firm’s equity investments focus on common stocks of public companies in three categories: event driven situations, such as corporate spinoffs, recapitalizations, financial restructurings, etc..; special situations; and credit focused equities. Gates Capital Management’s credit asset classes focus on larger issues such as distressed securities, generally senior secured claims where reorganization would mean a new debt instrument, and bank debts with an actively managed total return. The company keeps its holdings for 13.75 quarters on average and has had a most recent turnover rate of 20%. Gates Capital Management currently holds over $3.8 billion in total assets under management spread across 4 accounts, all of which are discretionary accounts. Although its total number of accounts has remained relatively stable in recent years, its total assets under management has been increasing, growing significantly from just over $300 million back in 2010 to well over 10 times that amount today. The company currently solely caters to pooled investment vehicles and takes advisory fees in the form of a percentage of assets and various performance based fees.
As of the latest 13F report, the guru’s equity portfolio contained 26 stocks valued at a total of $2.64Bil. The top holdings were ESI(6.21%), CHX(6.04%), and TMX(5.80%).
According to GuruFocus data, these were Gates Capital Management, Inc.’s top five trades of the quarter.
Atkore Inc
The guru established a new position worth 1,110,818 shares in NYSE:ATKR, giving the stock a 3.28% weight in the equity portfolio. Shares traded for an average price of $86.45 during the quarter.
On 11/15/2022, Atkore Inc traded for a price of $103.54 per share and a market cap of $4.28Bil. The stock has returned -0.70% over the past year.
GuruFocus gives the company a financial strength rating of 7 out of 10 and a profitability rating of 8 out of 10.
In terms of valuation, Atkore Inc has a price-earnings ratio of 5.34, a price-book ratio of 3.84, a price-earnings-to-growth (PEG) ratio of 0.13, a EV-to-Ebitda ratio of 3.68 and a price-sales ratio of 1.22.
The price-to-GF Value ratio is 1.02, earning the stock a GF Value rank of 5.
Boyd Gaming Corp
Gates Capital Management, Inc. reduced their investment in NYSE:BYD by 1,250,900 shares. The trade had a 2.26% impact on the equity portfolio. During the quarter, the stock traded for an average price of $53.56.
On 11/15/2022, Boyd Gaming Corp traded for a price of $59.23 per share and a market cap of $6.18Bil. The stock has returned -4.05% over the past year.
GuruFocus gives the company a financial strength rating of 4 out of 10 and a profitability rating of 7 out of 10.
In terms of valuation, Boyd Gaming Corp has a price-earnings ratio of 11.39, a price-book ratio of 4.01, a price-earnings-to-growth (PEG) ratio of 1.07, a EV-to-Ebitda ratio of 8.31 and a price-sales ratio of 1.87.
The price-to-GF Value ratio is 0.97, earning the stock a GF Value rank of 6.
Gaming and Leisure Properties Inc
Gates Capital Management, Inc. reduced their investment in NAS:GLPI by 765,631 shares. The trade had a 1.28% impact on the equity portfolio. During the quarter, the stock traded for an average price of $49.39.
On 11/15/2022, Gaming and Leisure Properties Inc traded for a price of $49.7 per share and a market cap of $12.80Bil. The stock has returned 10.09% over the past year.
GuruFocus gives the company a financial strength rating of 3 out of 10 and a profitability rating of 8 out of 10.
In terms of valuation, Gaming and Leisure Properties Inc has a price-earnings ratio of 20.37, a price-book ratio of 3.55, a price-earnings-to-growth (PEG) ratio of 2.37, a EV-to-Ebitda ratio of 15.85 and a price-sales ratio of 9.73.
The price-to-GF Value ratio is 1.13, earning the stock a GF Value rank of 3.
DaVita Inc
Gates Capital Management, Inc. reduced their investment in NYSE:DVA by 328,814 shares. The trade had a 0.96% impact on the equity portfolio. During the quarter, the stock traded for an average price of $87.7.
On 11/15/2022, DaVita Inc traded for a price of $72.1 per share and a market cap of $6.50Bil. The stock has returned -31.86% over the past year.
GuruFocus gives the company a financial strength rating of 3 out of 10 and a profitability rating of 9 out of 10.
In terms of valuation, DaVita Inc has a price-earnings ratio of 10.56, a price-book ratio of 12.20, a price-earnings-to-growth (PEG) ratio of 0.96, a EV-to-Ebitda ratio of 8.32 and a price-sales ratio of 0.61.
The price-to-GF Value ratio is 0.56, earning the stock a GF Value rank of 8.
Fortive Corp
Gates Capital Management, Inc. reduced their investment in NYSE:FTV by 487,671 shares. The trade had a 0.96% impact on the equity portfolio. During the quarter, the stock traded for an average price of $62.03.
On 11/15/2022, Fortive Corp traded for a price of $66.91 per share and a market cap of $23.67Bil. The stock has returned -14.13% over the past year.
GuruFocus gives the company a financial strength rating of 6 out of 10 and a profitability rating of 8 out of 10.
In terms of valuation, Fortive Corp has a price-earnings ratio of 35.03, a price-book ratio of 2.52, a price-earnings-to-growth (PEG) ratio of 11.24, a EV-to-Ebitda ratio of 20.26 and a price-sales ratio of 4.27.
The price-to-GF Value ratio is 0.84, earning the stock a GF Value rank of 7.
Please note, the numbers and facts quoted are as of the writing of this article and may not factor in the latest trading data or company announcements.
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