With the goal of generating strong risk-adjusted returns and capital appreciation, Bernard Horn (Trades, Portfolio)’s Polaris Capital Management invests in discounted but high-quality stocks in developed as well as emerging markets.
Overseeing approximately $14 billion in assets under management, the Boston-based firm’s pure global value philosophy combines investment technology with traditional fundamental research.
As such, GuruFocus is pleased to have Horn as one of our keynote speakers during the annual GuruFocus Value Conference next month.
The event, which will be held at the Hilton Omaha hotel, will start on Thursday, May 4 at 6 p.m. with our first speaker and a catered dinner. Then, the other speakers will present between 8 a.m. and 6 p.m. on Friday.
Tickets are still available, but seats are limited! Reserve your spot today.
Ahead of the conference, investors who plan to attend may want to learn more about Horn’s investments in order to effectively ask him questions about his strategy. The guru’s $377 millionequity portfolio consisted of 94 stocks as of the fourth quarter of 2022. Filings show the equity portfolio was most heavily invested in the financial services, consumer cyclical and health care sectors.
NPORT-P filings for the three months ended Dec. 31 show his top five holdings were United Therapeutics Corp. (UTHR, Financial), Marubeni Corp. (TSE:8002, Financial), AbbVie Inc. (ABBV, Financial), Crocs Inc. (CROX, Financial) and Williams Companies Inc. (WMB, Financial).
Investors should be aware that, just like 13F reports, NPORT-P reports do not provide a complete picture of a guru’s holdings to the public. Filed by certain mutual funds after each quarter’s end, they collect a wide variety of information on the fund for the SEC’s reference, but in general, the only information made public is in regard to long equity positions. Unlike 13Fs, they do require some disclosure for long equity positions in foreign stocks. Despite their limitations, even these filings can provide valuable information.
United Therapeutics
During the fourth quarter, Horn trimmed his United Therapeutics (UTHR, Financial) position by 25.41% to 27,300 shares. As the guru’s largest holding, it accounts for 2.01% of the equity portfolio. GuruFocus estimates he has gained 36.78% on the investment so far.
The Silver Spring, Maryland-based biotech company has a $10.46 billion market cap; its shares were trading around $225.93 on Tuesday with a price-earnings ratio of 15.04, a price-book ratio of 2.17 and a price-sales ratio of 5.64.
The GF Value Line suggests the stock is fairly valued currently based on its historical ratios, past financial performance and analysts’ future earnings projections.
At 76 out of 100, the GF Score indicates the company is likely to have average performance going forward. While it received high profitability and financial strength ranks, the ratings for GF Value and momentum were more moderate and growth was low.
Of the gurus invested in United Therapeutics, Jim Simons (Trades, Portfolio)’ Renaissance Technologies has the largest stake with 5.14% of its outstanding shares. Ray Dalio (Trades, Portfolio)’s Bridgewater Associates, Joel Greenblatt (Trades, Portfolio), Chuck Royce (Trades, Portfolio), Charles Brandes (Trades, Portfolio) and Ken Fisher (Trades, Portfolio) also own the stock.
Marubeni
The guru left his holding of Marubeni (TSE:8002, Financial) unchanged at 586,500 shares. Occupying 1.80% of the equity portfolio, it is his second-largest holding. GuruFocus data shows he has gained approximately 119.21% on the investment to date.
The Japanese conglomerate, which focuses on trading services and business investments in grain fields, natural resources, energy and power generation, has a market cap of 3.07 trillion yen ($23.07 billion); its shares closed at 1,809 yen on Monday with a price-earnings ratio of 5.58, a price-book ratio of 1.13 and a price-sales ratio of 0.32.
According to the GF Value Line, the stock is modestly overvalued currently.
The GF Score of 74 implies the company is likely to have average performance in the future on the back of a high momentum rank, middling marks for profitability, growth and financial strength as well as a low GF Value rating.
Horn is currently Marubeni’s largest guru shareholder with 0.03% of its outstanding shares. The iShares MSCI ACWI ex. U.S. ETF also has a position.
AbbVie
The investor left his AbbVie (ABBV, Financial) investment unchanged at 40,551 shares. As the third-largest holding, the stock makes up 1.74% of Horn’s equity portfolio. GuruFocus found he has gained around 70.45% on the investment.
The biotech company headquartered in Chicago has a $281.61 billion market cap; its shares were trading around $159.63 on Tuesday with a price-earnings ratio of 24.15, a price-book ratio of 16.37 and a price-sales ratio of 4.85.
Based on the GF Value Line, the stock appears to be modestly overvalued currently.
Further, the GF Score of 90 means the company has good outperformance potential, driven by high ratings for profitability, growth and momentum, a moderate financial strength rank and a low GF Value.
With a 0.09% stake, the T Rowe Price Equity Income Fund (Trades, Portfolio) is AbbVie’s largest guru shareholder. Other top guru investors include Diamond Hill Capital (Trades, Portfolio), the Eaton Vance Worldwide Health Sciences Fund (Trades, Portfolio), Simons’ firm, Robert Bruce (Trades, Portfolio) and Jefferies Group (Trades, Portfolio).
Crocs
Horn curbed his Crocs (CROX, Financial) holding by 12.26% in the most recent quarter to 59,376 shares. Now representing 1.71% of the equity portfolio as the fourth-largest position, GuruFocus says he has gained an estimated 148.27% on the investment.
The Broomfield, Colorado-based footwear company, which makes the popular foam clogs and sandals, has a market cap of $7.82 billion; its shares were trading around $126.62 on Tuesday with a price-earnings ratio of 14.57, a price-book ratio of 9.55 and a price-sales ratio of 2.20.
The GF Value Line suggests the stock is currently fairly valued.
The company has good outperformance potential due to its GF Score of 90. Although it raked in high ratings for two of the criteria, the financial strength, GF Value and momentum ranks are more moderate.
Holding 0.10% of its outstanding share, Horn is the company’s largest guru shareholder. Crocs is also being held by Dalio’s firm, Greenblatt and Paul Tudor Jones (Trades, Portfolio).
Williams Companies
In the fourth quarter, the guru left his holding of Williams Companies (WMB, Financial) unchanged at 192,500 shares. As the fifth-largest position, it accounts for 1.68% of the equity portfolio. GuruFocus estimates Horn has gained 46.89% on the investment since establishing it in the fourth quarter of 2020.
The midstream energy company headquartered in Tulsa, Oklahoma has a $36.08 billion market cap; its shares were trading around $29.61 on Tuesday with a price-earnings ratio of 17.72, a price-book ratio of 3.15 and a price-sales ratio of 3.28.
According to the GF Value Line, the stock is fairly valued.
The GF Score of 74 suggests the company is likely to have average performance in the future. While the momentum rank was high, profitability, growth and GF Value were more moderate and the financial strength rating was low.
Dodge & Cox is Williams’ largest guru shareholder with a 3.23% stake. The T Rowe Price Equity Income Fund (Trades, Portfolio), First Eagle Investment (Trades, Portfolio), Murray Stahl (Trades, Portfolio), Jones, Barrow, Hanley, Mewhinney & Strauss and Jefferies Group (Trades, Portfolio) also own the stock.
Additional top holdings and performance
Rounding out the rest of Horn’s top 10 holdings are UnitedHealth Group Inc. (UNH, Financial), CVS Health Corp. (CVS, Financial), Weichai Power Co. Ltd. (HKSE:02338, Financial), Allison Transmission Holdings Inc. (ALSN, Financial) and Gilead Sciences Inc. (GILD, Financial).
In 2022, the Polaris Global Value Fund returned -12.01%, slightly outperforming the S&P 500’s return of -18.11%.
