Primecap Increases Stakes in 2 Stocks

PRIMECAP Management was founded in September 1983 in Pasadena California, by Theo Kolokotrones, Mitch Milias and the late Howard Schow, who passed away in April 2012. Primecap Management is an independent investment management company. The firm's goal is to provide superior long-term equity investment results by following an investment approach based on four key principles:

  • Commitment to fundamental research.
  • Long-term investment horizon.
  • Emphasis on individual decision-making.
  • Focus on value.

On Nov. 30, Primecap added 815,983 shares of The Rubicon Project Inc. ( RUBI )

Rubicon Project provides automation advertising cloud technology, which is one of the largest cloud and big data computing systems in the world. This technology leverages over 50,000 algorithms and analyzes billions of data points in real time.

They offer three different products: the automation cloud, the buyer cloud, and the seller cloud. The Rubicon Project offers the opportunity for both buying and selling your advertising through automation with over 650 million unique consumers worldwide. They also offer the capability to cross platforms so you can use their cloud on multiple devices including mobile phone, tablet or PC.

The Rubicon Project has a market cap of $707.4 million, an enterprise value of $627.57 million, a P/S ratio of 3.07 and a quick ratio of 1.58.

The Rubicon Project has four good signs according to GuruFocus:

  • Interest coverage: The company has no debt.
  • Price: Close to one-year low
  • P/B ratio: Close to two-year low. The P/B (=3.05) is close to two-year low of 2.85.
  • P/S ratio: Close to one-year low. The P/S ratio (=2.91) is close to one-year low of 2.74.

This technology is truly amazing and I think that it's really going to change the future of advertising.

On Oct. 31 Primecap Management added 817,400 shares of Boot Barn Holdings Inc. ( BOOT ), a 148.32% increase. They now own 1,368,500 total shares in this holding.

Boot Barn is America's largest western and work store, with store locations in 29 states. They sell merchandise for men, women and children, which include boots, jeans, jackets, chaps, overalls, and hats. They sell many different brands of clothing at their location including their own Boot Barn brand.

Boot Barn has a market cap of $320.71 million, a P/E ratio of 29.79, an enterprise value of $584.92 million, and a quick ratio of 0.17.

Below is a Peter Lynch Chart for Boot Barn Holdings.

Boot Barn has shown some fluctuation during the fourth quarter of 2015, with the stock dropping by 34% since Sept. 30. They also have two severe warning signs for investors to look out for.

  • Short percentage of float: Boot Barn's short interest in high. 20.91% of the float is shorted.
  • Days inventory is building up: If a company builds up inventory, it may mean it is having difficulties selling its goods.

Disclaimer: author does not currently own shares in either one of these holdings.

Cheers to your investment success.

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This article first appeared on GuruFocus .

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

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

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