Respected value shop GMO just reported its second quarter
portfolio. The head of GMO,
Jeremy Grantham
, wrote in
his second quarter letter
extensively about possible shortage of food and other resources
and their price increases. He wrote
I am very bearish on the problems we humans face and, sadly,
very bullish on resources. Not surprising, I am even more
convinced than I was a year ago of the inevitability of rising
resource prices (and, unfortunately, associated societal and
international instability). Therefore I am more confident in my
suggested investment battle plan of a year ago. For any
responsible investment group with a 10-year horizon or longer,
one should move steadily to adopt a major holding of
resource-related investments. For my Foundation (i.e., personally
as opposed to institutionally where, reasonably enough, we cannot
impose 10-year plus horizons on our clients) I had adopted 30% in
resources as my eventual target and was slowly averaging in,
nervous of near-term substantial price declines, but even more
nervous of completely missing my own point. In my Foundation, I
have currently reached about the two-thirds point of 20%.
That question, along with a
discussion of overall GDP growth and why I think it is likely
to be lower in the future than generally expected, will be
discussed next quarter
. In the meantime, it may be worth asking which kind of
company will better resist lower GDP
growth, especially in the developed world
, and be better able to absorb pressure from higher resource
prices. Once
again, we prefer "quality" stocks. They have much lower
resource costs as a percentage of total revenues than typical
companies and they have a higher margin base from which to resist
margin pressure.
Regarding to historical high profit margin, he wrote:
One slight change, though, is that fantastic (almost
unbelievable) profit margin and earnings gains have finally
weakened a little. They
, together with Bernanke'
s super low rates, have been the twin pillars of the market
and not
bad ones
at all: here we
are up 8% for the year
in a
thoroughly unsettling
financial and
economic worl
d. With
margins
weakening, one of the twin pillars is looking shaky and price
declines look more likely than before.
As of 06/30/2012, GMO LLC owns 599 stocks with a total value of
$32.7 billion. These are the details of the buys and sells that
have the impact to portfolio of more than .1%.
- New Purchases:
RY
,
VIV
,
- Added Positions:
ORCL
,
PG
,
HPQ
,
VWO
,
MCD
,
ESRX
,
AMX
,
LO
,
CSCO
,
ABT
,
CL
,
LH
,
WFC
,
ZMH
,
MA
,
JPM
,
PEP
,
SUN
,
- Reduced Positions:
LOW
,
UNH
,
AMGN
,
WAG
,
MRK
,
VALE.P
,
PBR.A
,
NKE
,
ITUB
,
YUM
,
For the details of
Jeremy Grantham
's stock buys and sells, go to
http://www.gurufocus.com/StockBuy.php?GuruName=Jeremy+Grantham
This is the sector weightings of his portfolio:
|
Technology
|
27.6% |
|
Health Care
|
21.9% |
|
Consumer Goods
|
20.3% |
|
Consumer Services
|
9.6% |
|
Oil & Gas
|
6.4% |
|
Financials
|
5.8% |
|
Industrials
|
2.7% |
|
Telecom
|
2.2% |
|
Basic Materials
|
1.3% |
|
Not Assigned
|
0.8% |
|
Utilities
|
0.4% |
These are the top 5 holdings of Jeremy Grantham
- Johnson & Johnson (
JNJ
) - 26,152,844 shares, 5.4% of the total portfolio. Shares
added by 0.97%
- Oracle Corporation (
ORCL
) - 52,901,908 shares, 4.8% of the total portfolio. Shares
added by 14.44%
- The Coca-Cola Company (
KO
) - 19,105,455 shares, 4.6% of the total portfolio. Shares
reduced by 1.42%
- Microsoft Corporation (
MSFT
) - 49,343,452 shares, 4.6% of the total portfolio. Shares
reduced by 6.98%
- Pfizer Inc. (
PFE
) - 62,990,583 shares, 4.4% of the total portfolio. Shares
reduced by 0.95%
New Purchase: Royal Bank Of Canada (usa) (
RY
)
Jeremy Grantham initiated holdings in Royal Bank Of Canada (usa).
His purchase prices were between $48.04 and $58.05, with an
estimated average price of $53.12. The impact to his portfolio
due to this purchase was 0.16%. His holdings were 1,023,258
shares as of 06/30/2012.
New Purchase: Telefonica Brasil Sa (adr) (
VIV
)
Jeremy Grantham initiated holdings in Telefonica Brasil Sa (adr).
His purchase prices were between $23.31 and $31.1, with an
estimated average price of $26.55. The impact to his portfolio
due to this purchase was 0.1%. His holdings were 1,300,550 shares
as of 06/30/2012.
Sold Out: Motorola Mobility Holdings Inc (MMI)
Jeremy Grantham sold out his holdings in Motorola Mobility
Holdings Inc. His sale prices were between $38.31 and $39.99,
with an estimated average price of $38.99.
Added: Oracle Corporation (
ORCL
)
Jeremy Grantham added to his holdings in Oracle Corporation by
14.44%. His purchase prices were between $25.75 and $29.68, with
an estimated average price of $27.83. The impact to his portfolio
due to this purchase was 0.61%. His holdings were 52,901,908
shares as of 06/30/2012.
Added: The Procter & Gamble Company (
PG
)
Jeremy Grantham added to his holdings in The Procter & Gamble
Company by 34.54%. His purchase prices were between $59.21 and
$67.73, with an estimated average price of $63.84. The impact to
his portfolio due to this purchase was 0.59%. His holdings were
12,138,192 shares as of 06/30/2012.
Added: Hewlett-packard Company (
HPQ
)
Jeremy Grantham added to his holdings in Hewlett-packard Company
by 33.79%. His purchase prices were between $19.18 and $25.28,
with an estimated average price of $22.73. The impact to his
portfolio due to this purchase was 0.58%. His holdings were
37,965,326 shares as of 06/30/2012.
Added: Vanguard Msci Emerging Markets Etf (
VWO
)
Jeremy Grantham added to his holdings in Vanguard Msci Emerging
Markets Etf by 137.53%. His purchase prices were between $37.15
and $44.08, with an estimated average price of $40.23. The impact
to his portfolio due to this purchase was 0.54%. His holdings
were 7,690,232 shares as of 06/30/2012.
Added: Mcdonald's Corporation (
MCD
)
Jeremy Grantham added to his holdings in Mcdonald's Corporation
by 47.94%. His purchase prices were between $86.33 and $98.81,
with an estimated average price of $92.71. The impact to his
portfolio due to this purchase was 0.49%. His holdings were
5,499,432 shares as of 06/30/2012.
Added: Express Scripts Holding Company (
ESRX
)
Jeremy Grantham added to his holdings in Express Scripts Holding
Company by 21.52%. His purchase prices were between $50.59 and
$58.58, with an estimated average price of $54.44. The impact to
his portfolio due to this purchase was 0.35%. His holdings were
11,703,748 shares as of 06/30/2012.
Added: America Movil Sab De Cv (adr) (
AMX
)
Jeremy Grantham added to his holdings in America Movil Sab De Cv
(adr) by 70.59%. His purchase prices were between $22.94 and
$27.48, with an estimated average price of $24.56. The impact to
his portfolio due to this purchase was 0.32%. His holdings were
9,837,719 shares as of 06/30/2012.
Added: Lorillard Inc. (
LO
)
Jeremy Grantham added to his holdings in Lorillard Inc. by
26.12%. His purchase prices were between $119.48 and $137.14,
with an estimated average price of $129.46. The impact to his
portfolio due to this purchase was 0.29%. His holdings were
3,357,445 shares as of 06/30/2012.
Added: Cisco Systems, Inc. (
CSCO
)
Jeremy Grantham added to his holdings in Cisco Systems, Inc. by
9.31%. His purchase prices were between $15.99 and $21.18, with
an estimated average price of $18.06. The impact to his portfolio
due to this purchase was 0.27%. His holdings were 60,703,275
shares as of 06/30/2012.
Added: Colgate-palmolive Company (
CL
)
Jeremy Grantham added to his holdings in Colgate-palmolive
Company by 13.26%. His purchase prices were between $96.49 and
$102.88, with an estimated average price of $99.09. The impact to
his portfolio due to this purchase was 0.25%. His holdings were
6,752,251 shares as of 06/30/2012.
Added: Abbott Laboratories (ABT)
Jeremy Grantham added to his holdings in Abbott Laboratories by
9.43%. His purchase prices were between $59.49 and $63.4, with an
estimated average price of $61.55. The impact to his portfolio
due to this purchase was 0.25%. His holdings were 14,545,356
shares as of 06/30/2012.
Added: Laboratory Corp. Of America Holdings (LH)
Jeremy Grantham added to his holdings in Laboratory Corp. Of
America Holdings by 600.92%. His purchase prices were between
$82.01 and $94.14, with an estimated average price of $87.6. The
impact to his portfolio due to this purchase was 0.23%. His
holdings were 951,208 shares as of 06/30/2012.
Added: Wells Fargo & Company (WFC)
Jeremy Grantham added to his holdings in Wells Fargo &
Company by 4235.18%. His purchase prices were between $30.04 and
$34.32, with an estimated average price of $32.57. The impact to
his portfolio due to this purchase was 0.21%. His holdings were
2,197,285 shares as of 06/30/2012.
Added: Zimmer Holdings, Inc. (ZMH)
Jeremy Grantham added to his holdings in Zimmer Holdings, Inc. by
19.29%. His purchase prices were between $58.63 and $65.67, with
an estimated average price of $62.23. The impact to his portfolio
due to this purchase was 0.18%. His holdings were 5,572,489
shares as of 06/30/2012.
Added: Mastercard Inc (MA)
Jeremy Grantham added to his holdings in Mastercard Inc by 15.6%.
His purchase prices were between $392.67 and $459.75, with an
estimated average price of $426.29. The impact to his portfolio
due to this purchase was 0.15%. His holdings were 800,676 shares
as of 06/30/2012.
Added: Jpmorgan Chase & Co. (JPM)
Jeremy Grantham added to his holdings in Jpmorgan Chase & Co.
by 1617.01%. His purchase prices were between $31.51 and $45.67,
with an estimated average price of $38.39. The impact to his
portfolio due to this purchase was 0.12%. His holdings were
1,228,764 shares as of 06/30/2012.
Added: Sunoco, Inc. (SUN)
Jeremy Grantham added to his holdings in Sunoco, Inc. by
6433.58%. His purchase prices were between $37.73 and $50.16,
with an estimated average price of $44.94. The impact to his
portfolio due to this purchase was 0.11%. His holdings were
725,227 shares as of 06/30/2012.
Added: Pepsico, Inc. (PEP)
Jeremy Grantham added to his holdings in Pepsico, Inc. by 4%. His
purchase prices were between $64.73 and $69.95, with an estimated
average price of $67.38. The impact to his portfolio due to this
purchase was 0.11%. His holdings were 13,076,825 shares as of
06/30/2012.
Reduced: Lowe's Companies, Inc. (LOW)
Jeremy Grantham reduced to his holdings in Lowe's Companies, Inc.
by 80.87%. His sale prices were between $25.45 and $32.16, with
an estimated average price of $29.22. The impact to his portfolio
due to this sale was -0.72%. Jeremy Grantham still held 1,801,683
shares as of 06/30/2012.
Reduced: Unitedhealth Group Inc. (UNH)
Jeremy Grantham reduced to his holdings in Unitedhealth Group
Inc. by 29.23%. His sale prices were between $54.33 and $60.45,
with an estimated average price of $57.28. The impact to his
portfolio due to this sale was -0.5%. Jeremy Grantham still held
6,974,965 shares as of 06/30/2012.
Reduced: Amgen, Inc. (AMGN)
Jeremy Grantham reduced to his holdings in Amgen, Inc. by 39.41%.
His sale prices were between $65.74 and $73.56, with an estimated
average price of $69.45. The impact to his portfolio due to this
sale was -0.33%. Jeremy Grantham still held 2,495,086 shares as
of 06/30/2012.
Reduced: Merck & Co., Inc. (MRK)
Jeremy Grantham reduced to his holdings in Merck & Co., Inc.
by 23.36%. His sale prices were between $37.21 and $41.08, with
an estimated average price of $38.52. The impact to his portfolio
due to this sale was -0.28%. Jeremy Grantham still held 8,246,702
shares as of 06/30/2012.
Reduced: Walgreen Company (WAG)
Jeremy Grantham reduced to his holdings in Walgreen Company by
81.21%. His sale prices were between $28.69 and $35.8, with an
estimated average price of $32.35. The impact to his portfolio
due to this sale was -0.28%. Jeremy Grantham still held 642,629
shares as of 06/30/2012.
Reduced: Vale Sa (adr) (VALE.P)
Jeremy Grantham reduced to his holdings in Vale Sa (adr) by
22.12%. His sale prices were between $17.42 and $24.25, with an
estimated average price of $19.97. The impact to his portfolio
due to this sale was -0.24%. Jeremy Grantham still held
12,748,018 shares as of 06/30/2012.
Reduced: Petroleo Brasileiro Sa (adr) (PBR.A)
Jeremy Grantham reduced to his holdings in Petroleo Brasileiro Sa
(adr) by 21.59%. His sale prices were between $16.95 and $25.43,
with an estimated average price of $20.53. The impact to his
portfolio due to this sale was -0.19%. Jeremy Grantham still held
8,948,714 shares as of 06/30/2012.
Reduced: Nike, Inc. (NKE)
Jeremy Grantham reduced to his holdings in Nike, Inc. by 23.62%.
His sale prices were between $86.11 and $114.3, with an estimated
average price of $106.93. The impact to his portfolio due to this
sale was -0.17%. Jeremy Grantham still held 1,720,547 shares as
of 06/30/2012.
Reduced: Itau Unibanco Holding Sa (adr) (ITUB)
Jeremy Grantham reduced to his holdings in Itau Unibanco Holding
Sa (adr) by 20.46%. His sale prices were between $13 and $19.35,
with an estimated average price of $15.22. The impact to his
portfolio due to this sale was -0.14%. Jeremy Grantham still held
9,413,853 shares as of 06/30/2012.
Reduced: Yum! Brands, Inc. (YUM)
Jeremy Grantham reduced to his holdings in Yum! Brands, Inc. by
35.14%. His sale prices were between $62.38 and $73.92, with an
estimated average price of $69.17. The impact to his portfolio
due to this sale was -0.1%. Jeremy Grantham still held 869,100
shares as of 06/30/2012.
Here is the complete portfolio of Jeremy Grantham. Also check out
the Undervalued Stocks, Top Growth Companies, and High Yield
stocks of Jeremy Grantham.About GuruFocus: GuruFocus.com tracks
the stocks picks and portfolio holdings of the world's best
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.