As founder of Century Management, value investment Guru
Arnold Van Den Berg
has made updates to his portfolio picks for the end of the third
quarter. Below are 19 companies - eight of which he made stock
reductions and 11 of which he completely sold out his share
holdings.
Paychex Inc.
(
PAYX
)
Paychex is a national provider of payroll, human resource and
employee benefits outsourcing. Van Den Berg sold 210,440 of his
shares, reducing his current holdings to 387,609. With a market
price of $32.95, the company has a market cap of $12.18 billion.
It has a P/E ratio of 22.1, a P/S ratio of 5.5 and a P/B ratio of
7.4. GuruFocus gives Paychex a Business Predictability rank of
2.5 stars, a Financial Strength rank of 6 out of 10 and a
Profitability and Growth rank of 7 out of 10. Although GuruFocus
lists Paychex with 1 Good Sign showing consistent revenue and
earnings growth, it also has six Medium Warning signs that
indicate financial stress, a dividend payout ratio that's too
high, a dividend yield that is close to a 3-year low, a stock
price that is close to a three-year high, as well as a P/S ratio
close to a three-year high.
Universal Forest Products Inc.
(
UFPI
)
Universal Forest Products Inc. is a holding company that provides
capital, management and administrative services for its
subsidiaries, companies that manufacture and market such products
as structural lumber, engineered wood components and specialty
wood. Van Den Berg reduced his shares of Universal Forest by
38.94 percent, selling 178,602 stocks which brings his total
amount of shares down to 280,034. With a market price of $41.55,
the company has a market cap of $835.9 million. It has a P/E
ratio of 36.2, a P/S ratio of .5, and a P/B ratio of 1.4.
GuruFocus gives Universal Forest a Business Predictability rank
of 1 star, a Financial Strength rank of 9 out of 10 and a
Profitability and Growth of 4 out of 10. Universal Forest upholds
four severe warning signs, indicating that its per share revenue
and operating margin have declined for the last five years, a
long-term declining gross margin and severe cash flow divergence.
It has four Medium Warning Signs which indicate highs in dividend
yield, market price, P/B ratio and P/S ratio. On a lighter note,
it has three Good Signs in financial strength, the Altman Z-Score
(5.4) and the Piotroski F-Score (7).
3M Company
(
MMM
)
3M is a diversified technology company that produces products
targeting the people's needs in such industries as health care,
highway safety, office products and adhesives. Van Der Berg
reduced his shares to 50.6 percent, from 213,430 shares down to
105,435. With a market price of $94.03 per share, 3M has a market
cap of $65 billion. Its P/E ratio is 15.5, its P/S ratio is 2.2
and its P/B ratio is 3.9. GuruFocus gives 3M an 8 out of 10 for
both the Financial Strength rank and the Profitability and Growth
rank. 3M is also has a Business Predictability rank of 3.5 stars.
The company's three Medium Warning signs indicates that its
market price is close to a 10-year high, and the P/E and P/B
ratios are close to 2-year highs. However, 3M shows up under four
Good Signs, showing strength in financials, Altman Z-Score, per
share Revenue and operating margins.
Comcast Corporation
(
CMCSK
)
Comcast Corporation is company that develops and manages the
operation of broadband cable networks, as well as providing
electronic commerce and programming content. Van Der Berg reduced
his share of Comcast down 37.57 percent, from 850,660 shares down
to 531,070 shares. With a market price of $34.39 per stock,
Comcast has a market cap of $94.88 billion. It has a P/E ratio of
20.3, a P/S ratio of 1.7 and a P/B ratio of 2. It is ranked 4
stars in Business Predictability, 5 out of 10 in Financial
Strength and 9 out of 10 in Profitability and Growth. The company
has three Severe Warning Signs showing bankruptcy risks,
declining gross margin and cash flow divergence. Its two Medium
Warning Signs indicate that its market price is close to a
10-year high and its P/E ratio is close to a 3-year high. Lastly,
its four Good Signs reveal consistent growth in revenue,
expanding operating margin, and lows for its P/B and P/S ratios.
Steelcase Inc.
(
SCS
)
Steelcase designs and manufactures products for high-performance
work environments including furniture systems, seating, storage,
desks, casegoods, and technology products. Van Den Berg reported
to reducing his shares by 46.55 percent, from more than 2.6
million shares down to 1.3 million. With a market price of $10.13
per share, Steelcase has a market cap of 1.32 billion. It has a
P/E ratio of 14.9, a P/S ratio of .5 and a P/B ratio of 1.9. With
only one star for Business Predictability, GuruFocus ranks
Steelcase 6 out of 10 in Financial Strength and 4 out of 10 for
Profitability and Growth. Two Severe Warning signs indicate a
five-year decline in per share revenue, and a long-term decline
in gross margin. The three Medium Warning signs indicate close
highs in price, P/B ratio and P/S ratio. Lastly, Steelcase shows
two Good Signs stating that its dividend yield is close to a
two-year high and its P/E ratio is close to a one-year low.
Microsoft Corporation
(
MSFT
)
Microsoft is a company that develops, manufactures, licenses,
sells and supports software products. From 2,063,886 shares, Van
Der Berg has reduced his share holding by 49.01 percent, down to
1,052,412 shares. Microsoft has a current market price of $28.28
per stock and a market cap of $250.28 billion. The company has a
P/E ratio of 10.7, a P/S ratio of 3.4 and a P/B ratio of 3.8. It
has five stars for Business Predictability and holds a 9 out of
10 rank for both Financial Strength and Profitability and Growth.
It has two severe warning signs that indicate a declined
operating margin and an asset growth faster than revenue growth.
Despite three Medium Warning signs that say its market price is
close to a three-year high, its three Good Signs say that it has
strong financial strength, consistent revenue growth and a
dividend yield close to a three-year high.
Toll Brothers Inc.
(
TOL
)
Toll Brothers is a company that builds luxury homes and
communities. Van Den Berg reduced his shareholdings by 86.42
percent, from more than 1.5 million shares, down to 205,351. Toll
Brothers has one star under Business Predictability rank. It is
traded at $44.50 market price, with a $5.85 billion market cap.
Toll Brothers has a 4 out of 10 Financial Strength and a 6 out of
10 Profitability and Growth rank. Its three Severe Warning Signs
indicate a poor financial strength, a declining per share revenue
and cash flow divergence. At the same time, it has four Medium
Warning Signs, indicating financial strength, highs in market
price, P/B ratio and P/S ration, a grey Altman Z-Score indicating
financial stress.
MDC Holdings Inc.
(
MDC
)
MDC Holdings provides services in constructing, selling and
financing of residential housing and the acquisition of land for
use in homebuilding activities. Van Den Berg reduced his
shareholdings of MDC by 89.98 percent, from almost 1.5 million
shares down to 150,000 shares. MDC has a market price of $38.93
per share and a market cap of $1.95 billion. Under GuruFocus, it
is ranked one star for Business Predictability rank, 3 out of 10
for Financial Strength and 5 out of 10 for Profitability Growth.
It has a P/E ratio of 20.7, a P.B ratio of 2.2 and a P.S ratio of
2.3. MDC's six Severe Warning Signs, reveals poor financial
strength, possible financial manipulation, a declined gross
margin and per share revenue, an extremely low interest coverage
and a low Piotroski F-Score. Its five Medium Warning Signs also
indicate a low dividend yield and three-year highs for its market
price, P/B and P/S ratios.
Stocks, No More: Van Der Berg's Sold Out Shares
As much as Van Den Berg reduced his stock holdings recently, he
went beyond for the following few companies where he sold all of
his shares completely.
Illinois Tool Works
(ITW)
Illinois Tool Works is a company that manufactures industrial
technology including highly-engineered fasteners and components,
equipment and consumable systems, and specialty products and
equipment for customers all over the world. It has a market price
of $59.07, a market cap of 28.44 billion and three stars for its
Business Predictability rank. With a 7 out of 10 for both its
Financial Strength and Profitability and Growth rank, it also has
a P/E ratio of 15.2, a P/S ratio of 1.6 and a P/B ratio of 2.9
The Kroger Co.
(KR)
Kroger is a nationwide grocery retailer that manufactures and
processes food for sale by its supermarkets. Its stock currently
sells at $23.53 per share, and has a market cap of $12.54
billion. It has a Business Predictability rank of 4.5 stars, a
Financial Strength of 7 out of 10 and a Profitability and Growth
rank of 6 out of 10. Lastly, it has a P/E ratio of 11.2, a P/S
ratio of .1 and a P/B ratio of 3.4.
Campbell Soup Company
(CPB)
Campbell Soup is a global manufacturer and marketer of branded
convenience food products such as soups, sauces and biscuits. It
is being traded at a price of $35.10 per share, and has a market
cap of $11.08 billion. It has a P/E ratio of 14.5, a P/S ratio of
1.4 and a P/B ratio of 12.4. It is currently On Watch for its
Business Predictability Rank of 3.5 stars, and a ranking of 7 out
of 10 for both its Financial Strength and Profitability and
Growth.
Cintas Corporation
(CTAS)
Cintas is a company that provides an array of products and
services for such industries as gaming, hospitality, food
service, automotive, healthcare and cruise. Some of its products
include uniforms and apparel, first aid, cleanroom resources and
flame resistant clothing. As a corporation, Cintas is trading at
$42.51 per stock, with a market cap of $5.34 billion. It has a
P/E ratio of 17.8, a P/S ratio of 1.3 and a P/B ratio of 2.5 It
also has a Business Predictability rank of 2 stars, and a ranking
of 6 out of 10 for both Financial Strength and Profitability and
Growth.
The Coca-Cola Company
(KO)
Coca-Cola is a worldwide producer of soft drinks and beverages,
distributing in more than 200 countries and 1 billion servings a
day. It is traded at $38.57 per share, and has a market cap of
$173.71 billion. It has a P/E ratio of 19.6, a P/S ratio of 3.7
and a P/B ratio of 5.3. Coca-Cola has a Business Predictability
rank of 3.5 stars, a Financial Strength rank of 7 out of 10 and a
Profitability and Growth rank of 8 out of 10.
Seabright Holdings Inc.
(SBX)
SeaBright is a nationwide provider of workers' compensation
insurance. It is traded at $11.11 per share, with a $248.4
million market cap. It has a P/E ratio of 65.1, a P/B ratio of
0.7 and a P/S ratio of 0.9. SeaBright has a Financial Strength
rank of 5 out of 10, a Profitability and Growth of 4 out of 10,
and currently is not rated for a Business Predictability ranking.
Fortune Brands Home & Security Inc.
(FBHS)
Fortune Brands Home & Security is the parent company of many
brands of products such as faucets, padlocks, fiberglass, vinyl
windows and retail tool storage products. It currently sells at a
market price of $26.90 per share, with a market cap of $4.51
billion. It has a P/E ratio of 39, a P/B ratio of 2 and a P/S
ratio of 1.4. Fortune Brands has not yet been ranked for
Financial Strength, Profitability and Growth, and Business
Predictability.
Target Corporation
(TGT)
Target operates large-format general merchandise and food
discount stores in the United States. Selling at $62.90 per
share, it has a market cap of $42.03 billion. It has a P/E ratio
of 14.6, a P/S ratio of 0.6 and a P/B ratio of 2.7. With a
Business Predictability rank of five stars, it has a Financial
Strength rank of 6 out of 10 and a Profitability and Growth rank
of 8 out of 10.
The Walt Disney Company
(DIS)
Walt Disney is a worldwide entertainment company that produces
products and services in such industries as studio entertainment,
theme parks and resorts and consumer products. It is currently
selling at $51.52 per share, with a market cap of $95.04 billion.
It has a P/E ratio of 17.8, a P/S ratio of 2.3 and a P/B ratio of
2.2. With a Business Predictability rank of 3.5 stars, it also
has a 7 out of 10 Financial Strength rank and an 8 out of 10
Profitability and Growth rank.
Valero Energy Corporation
(VLO)
Valero Energy Corporation owns and operates refineries in the
U.S. and Canada. Its shares are trading for $31.40 per stock,
with a market cap of $17.59 billion. It has a Financial Strength
rank of 8 out of 10, a Profitability and Growth rank of 4 out of
10 and a Business Predictability rank of one star. Lastly, it has
a P/E ratio of 8.6, a P/S ratio of 0.1 an a P/B ratio of 1.1.
Wal-Mart Stores Inc.
(WMT)
Wal-Mart is a large retailer that operates in 27 countries, and
serves more than 200 million customers per week. It is selling at
a market price of $74.15 per share, with a market cap of $252.56
billion. It maintains a P/E ratio of 16.1, a P/S ratio of 0.6 and
a P/B ratio of 3.4. With a Business Predictability rank of five
stars, it has a Financial Strength rank of 7 out of 10 and a
Profitability and Growth rank of 8 out of 10.About GuruFocus:
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