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Diamond Hill Capital Growing - Six Sells

Posted
8/28/2013 5:34:00 PM
By: GuruFocus
Referenced Stocks:AGO;CB;DVN;HIG;MRK

The updated portfolio of Diamond Hill Capital Management lists 15 stocks, 19 of them new, a total value at $9.28 billion, and a quarter-over-quarter turnover of 6%. The portfolio is currently weighted with top three sectors: financial services at 26.9%, technology at 14% and consumer defensive at 13.5%.

Diamond Hill Capital Management is led by president and CEO R. H. Dillon. In Dillon's annual letter to shareholders in March 2013, the firm reported these financial results: Revenue was $67 million in 2012 compared with $64 million in 2011 and $41 million in 2007. The firm's assets under management finished the year at $9.4 billion, up from $8.7 billion in 2011 and $4.4 billion in 2007. Diamond Hill's operating profit margin of 36.7% was slightly ahead of 2011. The company estimated its AUM capacity in the range of $20 to $30 billion. Assets under management as of July 31, 2013, were $10.8 billion.

For the quarter ended June 30, 2013, Diamond Hill Capital reported a 23% increase in revenue at $19,893,096 compared to $16,160,855 a year ago. The net operating income also increased 23% at $7,151,691 for the second quarter of 2013 compared to $5,830,528 in the same quarter a year ago. The firm's net income increased 42% over the same quarter a year ago. Earnings per share also rose 36% from $1.07 in the same quarter a year ago to $1.45 in the second quarter of 2013.

Diamond Hill Capital made 51 sells and reductions with these six high-impact trades as of June 30, 2013:

Hartford Financial Services Group Inc. ( HIG ): Reduced

Impacts Portfolio: -2.03%

Current Shares: 3,880,907

Up 67% over 12 months, Hartford Financial Services Group has a market cap of $13.5 billion; its shares were traded at around $29.95 with a P/B ratio of 0.70.

Guru Action: As of June 30, 2013, Diamond Hill Capital reduced its position by 12.59%, selling 7,388,755 at an average price of $28.84 for a gain of 2.9%.

The firm has averaged a gain of 53% on 11,643,746 shares bought at an average price of $19.42 per share. On shares sold, the firm averaged a gain of 4% on 7,781,889 shares sold at an average price of $28.58 per share.

Track historical pricing, revenue and net income:



Merck & Co. Inc. ( MRK ): Sold Out

Impacts Portfolio: -1.6%

Up 9% over 12 months, Merck & Co. has a market cap of $137.86 billion; its shares were traded at around $47.29 with a P/E ratio of 28.10.

Guru Action: As of June 30, 2013, Diamond Hill Capital sold out its position, selling 3,485,551 shares at an average price of $46.81, for a gain of 0.6%.

Diamond Hill's trading history shows 15 quarters of pure gains.



Track historical pricing, revenue and net income:



Chubb Corp. ( CB ): Sold Out

Impacts Portfolio: -0.87%

Up 14% over 12 months, Chubb Corp. has a market cap of $21.33 billion; its shares were traded at around $83.47 with a P/E ratio of 12.00.

Guru Action: As of June 30, 2013, Diamond Hill Capital sold out its position, selling 942,439 shares at an average price of $87.50, for a loss of 4.6%.

Track historical pricing:



Assured Guaranty Ltd. ( AGO ): Reduced

Impacts Portfolio: -0.67%

Current Shares: 2,039,184

Up 52% over 12 months, Assured Guaranty Ltd. has a market cap of 3.67 billion; its shares were traded at around $20.20 with a P/E ratio of 13.10.

Guru Action: As of June 30, 2013, Diamond Hill Capital reduced its position by 61.33%, selling 3,234,532 shares at an average price of $21.79, for a loss of 8.2%.

The firm has averaged a gain of 21% on 10,444,969 shares bought at an average price of $16.59 per share. On shares sold, the firm averaged a gain of 4% on 8,405,785 shares sold at an average price of $19.22 per share.

Track historical pricing:



Devon Energy Corp. ( DVN ): Reduced

Impacts Portfolio: -0.54%

Current Shares: 2,171,546

Down 3% over 12 months, Devon Energy Corp. has a market cap of $23.13 billion; its shares were traded at around $58.10 with a P/B ratio of 1.20.

Guru Action: As of June 30, 2013, Diamond Hill Capital reduced its position by 30.16%, selling 937,987 shares at an average price of $55.70, for a gain of 2.3%.

The firm has averaged a loss of 23% on 3,257,697 shares bought at an average price of $74.34 per share. On shares sold, the firm averaged a loss of 12% on 2,959,814 shares sold at an average price of $64.95 per share.

Track historical pricing:



Charles Schwab Corp. ( SCHW ): Reduced

Impacts Portfolio: -0.44%

Current Shares: 5,741,763

Up 55 % over 12 months, Charles Schwab Corp. has a market cap of $26.65 billion; its shares were traded at around $20.97 with a P/E ratio of 31.00.

Guru Action: As of June 30, 2013, Diamond Hill Capital reduced its position by 29.12%, selling 2,358,786 shares at an average price of $18.48, for a gain of 12.2%.

The firm has averaged a gain of 57% on 8,686,336 shares bought at an average price of $13.21 per share. On shares sold, the firm averaged a gain of 15% on 2,944,573 shares sold at an average price of $18.10 per share.

Track historical pricing:



Diamond Hill manages five long-only equity strategies, three alternative equity strategies and a fixed income strategy.

Here is the complete portfolio of Diamond Hill Capital .



Be sure to read:

1. Diamond Hill Capital's Undervalued Stocks
2. Diamond Hill Capital's Top Growth Companies
3. Diamond Hill Capital's High Yield stocks
4. Stocks that Diamond Hill Capital keeps buying

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