Whitman Adds to 3 Positions in 3rd Quarter

- By David Goodloe

Martin Whitman (Trades, Portfolio), founder and portfolio manager of the Third Avenue Value Fund and adjunct faculty member at Yale's School of Management, added to three positions in the portfolio in the third quarter. It was the fewest quarterly additions the guru has made since the third quarter of 2013.


The largest addition was to Johnson Controls International PLC (JCI), a producer of auto parts and heating/ventilation/air conditioning equipment with offices in Wisconsin and Ireland. The purchase of 232,800 shares for an average price of $43.6 per share elevated the position by more than 71% with a 0.95% impact on the portfolio.

Barrow, Hanley, Mewhinney & Strauss is Johnson Controls' leading shareholder among the gurus with 39,308,460 shares. The stake is 6.16% of Johnson Controls' outstanding shares and 2.65% of the guru's total assets.

Johnson Controls has a price-earnings (P/E) ratio of 44.62, a forward P/E of 15.36, a price-book (P/B) ratio of 2.95 and a price-sales (P/S) ratio of 0.80. GuruFocus gives Johnson Controls a Financial Strength rating of 5/10 and a Profitability and Growth rating of 6/10 with return on equity (ROE) of 6.38% that is lower than 59% of the companies in the Global Auto Parts industry and return on assets (ROA) of 2.10% that is lower than 65% of the companies in that industry.

35c340ecbd556638891e11063a571b96.png

Johnson Controls sold for $41.19 per share at market close Wednesday. The DCF Calculator gives Johnson Controls a fair value of $5.03.

Johnson Controls will spin off its automotive seatings and interiors businesses on Oct. 31.

The guru increased the position in Ralph Lauren Corp. (RL), a New York-based designer, marketer and distributor of clothing, footwear, fragrances, housewares and jewelry, by more than 22%. The guru acquired 44,600 shares for an average price of $93.75 per share. The transaction had a 0.39% impact on the portfolio.

Ralph Lauren's leading shareholder among the gurus is Mason Hawkins (Trades, Portfolio) with a stake of 2,736,418 shares. The stake is 3.33% of Ralph Lauren's outstanding shares and 2.53% of the guru's total assets.

Ralph Lauren has a P/E of 28.02, a forward P/E of 18.80, a P/B of 2.37 and a P/S of 1.20. GuruFocus gives Ralph Lauren a Financial Strength rating of 7/10 and a Profitability and Growth rating of 7/10 with ROE of 8.27% that is higher than 53% of the companies in the Global Apparel Manufacturing industry and ROA of 4.97% that is higher than 59% of the companies in that industry.

04298612a6a28a7a0b4007efe14ef492.png

Ralph Lauren sold for $101.71 per share Wednesday. The DCF Calculator gives Ralph Lauren a fair value of $49.86.

David Lauren, the son of the company's founder, has been named the company's vice president and chief innovation officer.

The guru raised the position in Harman International Industries Inc. (HAR), a Connecticut-based electronics company specializing in car audio components, by nearly 16% with the purchase of 49,700 shares for an average price of $75.87 per share. The deal had a 0.37% impact on the portfolio.

John Rogers (Trades, Portfolio) is Harman International Industries' leading shareholder among the gurus with a stake of 1,257,068 shares. The stake is 1.8% of Harman International Industries' outstanding shares and 1.13% of the guru's total assets.

Harman International Industries has a P/E of 16.38, a forward P/E of 12.12, a P/B of 2.32 and a P/S of 0.88. GuruFocus gives Harman International Industries a Financial Strength rating of 6/10 and a Profitability and Growth rating of 7/10 with ROE of 14.94% that is higher than 82% of the companies in the Global Consumer Electronics industry and ROA of 6.16% that is higher than 72% of the companies in that industry.

23572c5cc97a614a219dce5b38b0367d.png

Harman International Industries sold for $81.49 per share Wednesday. The DCF Calculator gives Harman International Industries a fair value of $53.29.

Disclosure: I do not own any stocks mentioned in this article.

Start a free seven-day trial of Premium Membership to GuruFocus.

This article first appeared on GuruFocus.