Keep It Simple - Robert Karr's Top Three

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As a devoted disciple to his investing Guru Julian Robertson , Robert Karr is famed as one of the "Tiger Cubs" and keeps his investments simple. An expert in Asian markets, Karr is the founder of his employee-owned hedge fund Joho Capital. Holding concentrated positions in new technology companies, Karr's portfolio is weighted with a large technology sector at 64.3%, followed by consumer defensive at 28.6%. His updated portfolio contains 14 stocks, two of them new, with a total value of $902 million and a quarter-over-quarter turnover of 26%.

Here's an update on Karr's top three holdings and how the companies are performing.

No. 1: Google Inc. ( GOOG ), Weighting: 25.3%, Shares Owned: 287,596, Value: $228 million

Robert Karr of Joho Capital holds 0.09% of GOOG shares outstanding. Since second quarter of 2008, Karr's trading history shows a 78% gain on 417,449 shares bought at an average price of $493.27 per share. He also gained 76% on 328,743 shares sold at an average share price of $498.90 per share. In the first quarter of 2013, Karr bought 9,000 more shares at $778.50 per share and made a 13.1% gain.

Up 46% over 12 months, Google Inc. has a market cap of $289.1 billion, a P/E of 25.80, and a P/S of 5.86. The company was incorporated in California in September 1998 and reincorporated in Delaware in August 2003. Google Inc. had an annual average earnings growth of 44% over the past 10 years. GuruFocus rated Google Inc. the business predictability rank of 2.5-star .

Tracking GOOG's valuation since August 2004:


GOOG data by GuruFocus.com

Google Inc. reported consolidated revenues of $13.97 billion for the quarter ended March 31, 2013, an increase of 31% compared to the first quarter of 2012. Google Inc. reported advertising revenues, consistent with GAAP, on a gross basis without deducting traffic acquisition costs ( TAC ). In the first quarter of 2013, TAC totaled $2.96 billion, or 25% of advertising revenues.

No. 2: Mead Johnson Nutrition Company ( MJN ), Weighting: 15.2%, Shares Owned: 1,766,900, Value: $136 million

Robert Karr also holds 0.87% of MJN shares outstanding. A relatively new holding since second quarter of 2010, Karr's trading history shows an 8% gain on 1,766,900 shares bought at an average cost of $74 per share. He also gained 76% on 328,743 shares sold at an average share price of $498.90 per share. In the first quarter of 2013, Karr gained 8.8% on his holding.

Down 3% over 12 months, Mead Johnson Nutrition Company, a Delaware corporation, was founded in 1905. Mead Johnson Nutrition Company has a market cap of $16.14 billion; its shares were traded at around $79.52 with a P/E ratio of 26.50 and P/S ratio of 4.07. The dividend yield of Mead Johnson Nutrition Company stocks is 1.60%. Mead Johnson Nutrition Company had an annual average earnings growth of 2.4% over the past five years.

Tracking MJN's price per share over the years:



MJN data by GuruFocus.com

Mead Johnson Nutrition Company reported its first quarter 2013 revenue of $1.037 billion, compared to $9.8 million in the previous quarter. The company's gross profit was $647 million for the first quarter of 2013, compared to $599 million in the previous quarter.

No. 3: Baidu Inc. ( BIDU ), Weighting: 13.7%, Shares Owned: 1,407,050, Value: $123 million

Guru Robert Karr also holds 0.40% of BIDU shares outstanding. Baidu Inc. is headquartered in Beijing and is the leading Chinese language Internet search provider.

Karr's trading history shows that he made major gains on this holding from the second quarter of 2008 through the first quarter of 2010, after which gains dwindled, and fell into the red zone in the fourth quarter of 2010 at a loss of 9.1%. Karr has been losing on this holding since that time, bringing his average cost of around 1.4 million shares to $97 per share for an overall loss of 2%.

Down 22% over 12 months, Baidu was incorporated in the Cayman Islands in January 2000 as "Baidu.com, Inc." The company has a market cap of $32.96 billion; its shares were traded at around $93.54 with a P/E ratio of 19.30 and P/S ratio of 8.57. Baidu Inc. had an annual average earnings growth of 79.9% over the past five years.

Tracking BIDU's price changes:



BIDU data by GuruFocus.com

Baidu reported its first quarter 2013 revenue of $961.0 million (RMB 5.969 billion), a 40.0% increase from the corresponding period in 2012. The company's operating profit in the first quarter of 2013 was $355.9 million (RMB 2.210 billion), a 5.7% increase from the corresponding period in 2012.

"We saw healthy financial results in the first quarter of 2013 as we continued to invest in establishing China's leading mobile ecosystem." said Robin Li, chairman and chief executive officer of Baidu. "Our mobile offering is making exciting progress, with our flagship mobile search product having now surpassed 100 million daily active users, an over 25% increase from the end of the fourth quarter."

Robert Karr's Joho Capital serves mainly pooled investment vehicles and caters to charitable organizations. Employing a long/short equity strategy to create its portfolios, Joho Capital invests in public equity markets across the globe with a focus on Japan, China, Korea and other Asian markets.

Here is the complete portfolio of Robert Karr.

Also check out:

1. Robert Karr's Undervalued Stocks
2. Robert Karr's Top Growth Companies
3. Robert Karr's High Yield stocks
4. Stocks that Robert Karr keeps buying

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing

Referenced Stocks: BIDU , GOOG , MJN , TAC

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