Download - Hunting for Buffett’s Next Elephant
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HOLT
Market Commentary
Hunting for Buffett’s Next Elephant: Analyzing his Process for Acquisitions to Find Ideas
HOLT Sector Specialist Quarterly Thematic Update
March 2016
U.S. HOLT Sector Specialist Team
Consumer Specialist: Bhumika Gashti, CFA ([email protected])
Healthcare Specialist: Steve Bock, CFA ([email protected])
Technology Specialist: John Talbott, CFA, CPA ([email protected])
Energy & Materials Specialist: Vadim Vintsevsky ([email protected])
Financials Specialist: Ben Weyers ([email protected])
Industrials Specialist: Kevin Donovan ([email protected])
Adam Fuelleman, CFA ([email protected])
Rachael Harrison ([email protected])
Stephen Price ([email protected])
Ryan Ruggaard ([email protected])
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HOLT
Why Look to Warren Buffett Now? The rise in global market volatility has made many investors question their portfolios and take a short-term view of the markets. Examining Warren
Buffett’s investment process and long-term success can provide a compass in these times.
The Buffett Investing Process: Buffett’s approach is to take equity stakes or conduct 100% outright acquisitions (e.g. PCP recently) of wonderful companies at fair prices. The purpose of
this report is to evaluate his process for outright acquisitions to find ideas for your portfolio.
Buffett’s Outright Acquisitions in HOLT: Analyzed within are Buffett’s material public acquisitions over the past 20 years. True to his word, Buffett has consistently purchased high
CFROI® companies with low expectations (i.e. inexpensive). Furthermore, the margin profile of
these firms has been remarkably stable over time. Finally, Buffett has arguably been modest all
of these years; he actually buys wonderful companies at wonderful prices.
Applying Buffett’s Approach to Find Ideas for Your Portfolio: Provided within are sector-specific “Potential Buffett Like Ideas for Your Portfolio” generated utilizing his strategy for
outright acquisitions coupled with his investing philosophy through the perspective of HOLT.
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Hunting for Buffett’s Next Elephant: Analyzing his Process for Outright Acquisitions to Find Ideas for Your Portfolio
Note: Precision Castparts (PCP) acquisition was closed in February 2016.
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HOLT 2
Current Market Environment: Recent global economic uncertainty has created significant volatility in U.S. equity markets, causing Investors to take a short term view of the markets.
S&P 500 Composite
10 Year US Treasury Yield
CBOE Volatility Index (VIX)
Oil
-14.2%
-57.3% -33.2%
+135%
Source: Bloomberg, LP; Date range is January 2, 2015 to March 4, 2016.
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HOLT 3
Value of $1 Invested - Berkshire Hathaway vs. S&P 500
Annualized Return
(BRK): +20.8%
Berkshire’s best year in 1976
(+129%) driven by Insurance
and Banking investments
During the Great Recession
Berkshire was down 31%,
but outperformed the S&P
500 which fell 37%
During the “Internet
Bubble” Berkshire
underperformed
Early 1990’s Recession
Annualized Return
(S&P 500): +9.7%
Source: Berkshire Hathaway’s 2015 Annual Report and Investor Letter; NBER, Federal Reserve Bank of St. Louis.
Berkshire Hathaway vs S&P 500: Buffett’s investment approach has yielded incredible wealth for the shareholders of Berkshire Hathaway over the past 50 years. A closer review of Buffett’s strategy
could provide a compass for the current market environment.
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HOLT 4
$132 Billion Equity Portfolio
Buffett’s Investment Process: Buffett’s approach is to take equity stakes or conduct 100% outright acquisitions (e.g. PCP recently) of wonderful companies at fair prices. The purpose of this report is to
evaluate his outright acquisitions to find ideas for your portfolio.
Wells Fargo & Co
($26.1B) Kraft Heinz Co
($23.7B)
Coca-Cola Co
($17.2B)
International Business
Machines
($11.2B)
American Express Co
($10.5B) Phillips 66
($5.0B)
Outright Acquisitions
Johns Manville
(Purchased 2001 for $2.2B)
Burlington Northern Santa Fe
(Purchased 2010 for $38.1B) Precision Castparts Corp
(Purchased 2016 for $35.6B)
Lubrizol Corp
(Purchased 2011 for $9.2B)
Shaw Industries
(Purchased 2000 for $2.1B) Clayton Homes
(Purchased 2003 for $1.8B)
Source: Berkshire Hathaway’s 2015 Q4 Quarterly Report and 13-F filing, Bloomberg LP.
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HOLT
Buffett’s Investment Philosophy: Warren Buffett’s investment philosophy (distilled below) can be considered through the HOLT framework.
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High returns on equity and high returns on
net tangible assets,
Demonstrated consistent earnings power
and ability to cope with inflation,
Employ minimal or no debt in the firm’s
capital structure,
Wonderful business purchased at a fair
price,
Strong management in simple to
understand businesses.
Buffett’s Investing Approach HOLT Framework
Stable and/or improving CFROI® levels and
economic profit generation,
Stable and/or improving margin profile over
a long period of time,
Low HOLT economic leverage, which also
includes off balance sheet debt,
Consistently high CFROI business with fade
implied in its price,
Satisfactory HOLT accounting quality
scores, excluding certain industries.
Source: Buffett’s investing approach paraphrased from his annual reports over the years and page 32 of 2015 annual report.
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HOLT
Buffett’s Outright Acquisitions in HOLT: When analyzing Buffett’s outright acquisitions in HOLT, evidence clearly suggests that Buffett consistently purchases high CFROI companies with stable
margins that are priced for long-term CFROI levels to fall dramatically (i.e. the firms are inexpensive).
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CFROI (%) Sales, HOLT Operating Margins and Asset Turns
Asset Growth (%)
All data is as of the month-end prior to announced acquisition (T=0). Annual data; Metrics above represent average of select acquisitions over $250 million. Source: Credit Suisse HOLT Lens
Buffett tends to buy firms that earn consistently high CFROI levels (dark blue bars) at a low market implied CFROI (green dot below).
In addition to buying high CFROI companies at a low market implied
CFROI, Buffett also
purchases firms with
very stable margin profiles.
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Recent Acquisition - Precision Castparts (PCP): CFROI levels have been relatively stable since increasing off the lows in 2003, including throughout the 2008 financial crisis. Like most Buffett
acquisitions, PCP has above average CFROI with strong margins and modest expectations.
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CFROI (%)
Source: Credit Suisse HOLT Lens
Sales, Margins and Asset Turns
Asset Growth (%)
Market Implied CFROI
after acquisition announcement
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HOLT 8
HOLT’s M&A Database: Investors can use Credit Suisse HOLT Lens to evaluate a company’s acquisition skill by accessing the “Acquisitions & Divestitures” company report.
Access both Public and Private Acquisition Data
Source: Credit Suisse HOLT Lens
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HOLT
Potential Buffett Ideas for Your Portfolio
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HOLT
Consumer Discretionary & Staples (page 12)
– AAP, HAIN, HBI
Technology (page 17)
– CHKP, MMS
Healthcare (page 21)
– HSIC, MYL
Financials (page 25)
– AMTD, MCO
Industrials (page 29)
– SNA, WAB
Energy & Materials (page 33)
– IFF, POL
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Note: Tickers contain links to company page in HOLT Lens.
Sector Buffett Screens and Firms Highlighted
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HOLT
Current Sector CFROI Profile
CFROI Profile: “Potential Buffett Ideas” Potential Buffett Ideas for Your Portfolio
Ticker Company Market Cap
($B)
CFROI
(LFY)
HOLT Warranted
Upside
VFC VF CORP 27.7 20.7% 15%ROST ROSS STORES INC 22.8 14.6% 7%MNST MONSTER BEVERAGE CORP 21.9 31.1% 26%HBI HANESBRANDS INC 11.0 16.2% 34%AAP ADVANCE AUTO PARTS INC 11.0 13.7% 54%KORS MICHAEL KORS HOLDINGS LTD 10.2 28.1% 99%KMX CARMAX INC 9.9 12.8% 63%HAS HASBRO INC 9.5 14.8% 17%HOG HARLEY-DAVIDSON INC 8.0 14.7% 45%LKQ LKQ CORP 8.6 16.1% 38%GRMN GARMIN LTD 7.7 14.4% 27%LEA LEAR CORP 7.6 17.9% 112%BWA BORGWARNER INC 7.2 14.0% 72%PVH PVH CORP 6.5 16.1% 68%GIL GILDAN ACTIVEWEAR INC 6.3 16.7% 16%GNTX GENTEX CORP 4.2 15.8% 66%HAIN HAIN CELESTIAL GROUP INC 3.9 19.2% 29%BWLD BUFFALO WILD WINGS INC 3.0 12.0% 19%THO THOR INDUSTRIES INC 2.9 25.7% 136%HELE HELEN OF TROY LTD 2.7 31.8% 86%SAM BOSTON BEER INC -CL A 2.4 16.8% 25%TUP TUPPERWARE BRANDS CORP 2.5 12.7% 25%GNC GNC HOLDINGS INC 2.3 14.3% 20%GIII G-III APPAREL GROUP LTD 2.4 11.9% 45%DORM DORMAN PRODUCTS INC 1.8 16.3% 55%THRM GENTHERM INC 1.5 23.7% 128%USNA USANA HEALTH SCIENCES INC 1.5 25.5% 56%DW DREW INDUSTRIES INC 1.4 18.7% 66%TFM FRESH MARKET INC 1.1 11.6% 39%
HOLT Sector Specialist ideas highlighted on following pages
Sector Example: How to read the following sector summary pages
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(1) Screen for potential Buffett
acquisition targets given the sector-specific criteria noted in the Appendix.
(2) Using the companies identified
in the screen on the right, model the “Potential Buffett Ideas” CFROI profile (top chart).
(3) Evaluate the CFROI profile of the Buffett Acquisition Targets relative to the Sector Median
CFROI Profile (lower chart).
(4) Lastly, HOLT Sector Specialists highlight selected companies, noted in green, on the following pages.
Portfolio CFROI profile using the “Potential
Buffett Ideas” from the table on the right
Please see Appendix for screen methodology. Source: Credit Suisse HOLT Lens
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HOLT
Consumer Discretionary & Staples
Bhumika Gashti, CFA
U.S. Consumer Sector Specialist
+1 312 345 6166
Stephen Price
U.S. Consumer Team
+1 312 345 6188
12
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HOLT
Ticker Company Market Cap
($B)
CFROI
(LFY)
HOLT Warranted
Upside
VFC VF CORP 27.7 20.7% 15%ROST ROSS STORES INC 22.8 14.6% 7%MNST MONSTER BEVERAGE CORP 21.9 31.1% 26%HBI HANESBRANDS INC 11.0 16.2% 34%AAP ADVANCE AUTO PARTS INC 11.0 13.7% 54%KORS MICHAEL KORS HOLDINGS LTD 10.2 28.1% 99%KMX CARMAX INC 9.9 12.8% 63%HAS HASBRO INC 9.5 14.8% 17%HOG HARLEY-DAVIDSON INC 8.0 14.7% 45%LKQ LKQ CORP 8.6 16.1% 38%GRMN GARMIN LTD 7.7 14.4% 27%LEA LEAR CORP 7.6 17.9% 112%BWA BORGWARNER INC 7.2 14.0% 72%PVH PVH CORP 6.5 16.1% 68%GIL GILDAN ACTIVEWEAR INC 6.3 16.7% 16%GNTX GENTEX CORP 4.2 15.8% 66%HAIN HAIN CELESTIAL GROUP INC 3.9 19.2% 29%BWLD BUFFALO WILD WINGS INC 3.0 12.0% 19%THO THOR INDUSTRIES INC 2.9 25.7% 136%HELE HELEN OF TROY LTD 2.7 31.8% 86%SAM BOSTON BEER INC -CL A 2.4 16.8% 25%TUP TUPPERWARE BRANDS CORP 2.5 12.7% 25%GNC GNC HOLDINGS INC 2.3 14.3% 20%GIII G-III APPAREL GROUP LTD 2.4 11.9% 45%DORM DORMAN PRODUCTS INC 1.8 16.3% 55%THRM GENTHERM INC 1.5 23.7% 128%USNA USANA HEALTH SCIENCES INC 1.5 25.5% 56%DW DREW INDUSTRIES INC 1.4 18.7% 66%TFM FRESH MARKET INC 1.1 11.6% 39%
Consumer Discretionary & Staples: The CFROI profile of “Potential Buffett Ideas” in Consumer is more than 600 bps higher than the overall sector while at the same time providing significantly lower
market expectations (i.e. less expensive).
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Current Sector CFROI Profile
CFROI Profile: “Potential Buffett Ideas” Potential Buffett Ideas for Your Portfolio
HOLT Sector Specialist ideas highlighted on following pages
Please see Appendix for screen methodology. Source: Credit Suisse HOLT Lens
Portfolio CFROI profile using the “Potential
Buffett Ideas” from the table on the right
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HOLT
ADVANCE AUTO PARTS (AAP): Strong operator with low market expectations and potential catalysts to move the stock
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Price Change % -2.22
-0.85
-11.48
-0.24
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Specialty Retail Market Cap $11.2B
152.37 USD
6m 3m 1m
HOLT Warranted Price 239.75 (+57%)
Scorecard Analysis
`
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Outperform
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Above Average
Governance Good
92
81
HOLT takeaways: Similar to peers AZO & ORLY, AAP has consistently earned double-digit CFROI levels over the last 10 years. Additionally,
over the last several years, the company benefited from higher overall margins (improved merchandising and pricing optimization)¹. AAP
recently acquired General Parts International in January 2014 which has led to improved overall returns on account of higher asset turns.
Despite this strong track record, AAP under-earns relative to AZO (19% CFROI) and ORLY (17% CFROI). ORLY acquired CSK back in
2008, the company has since improved CFROI by over 900bps. Is there similar scope for AAP? With defensive industry fundamentals,
potential for management change, and low market expectations, AAP might make a great longer term investment. Author: Bhumika Gashti
5.86
-0.18
Asset Turns (Sales/ Invested Capital)
86
46
¹ 2015 SEC 10K Filing
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HOLT
HAIN CELESTIAL GROUP (HAIN): High quality food producer operating in a growing category that is priced attractively relative to most Staples peers
15
Price Change % -2.03
-0.99
-33.71
-0.76
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Food Products Market Cap $4.0B
38.63 USD
6m 3m 1m
HOLT Warranted Price 50.45 (+31%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Not Rated
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Good
Governance Average
73
85
HOLT takeaways: HAIN, a manufacturer of organic and natural products, improved CFROI over the past decade largely though
improvements in margins. With CFROI levels close to 20%, it now earns returns close to the top of most food product peers. However, peer
Annie’s had earned slightly higher returns at 25% before being bought by General Mills (GIS). Perhaps there is scope for continued
improvement? HAIN has proven to be a solid acquirer as goodwill paid appears to be at a minimum and the firm continues to deliver CFROI
improvements and strong growth post acquisitions. While CFROI forecasts suggest some decline in near term returns, the market is pricing
HAIN to deliver 11% CFROI in 10 years (well below the peer median) along with growth slowing to mid-single digits. Author: Bhumika Gashti
6.59
0.00
Asset Turns (Sales/ Invested Capital)
7
93
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HOLT
HANESBRANDS (HBI): Strong track record of creating shareholder wealth with low market expectations
16
Price Change % -5.68
0.12
-0.64
-0.22
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Textiles, Apparel & Luxury Goods Market Cap $11.5B
29.38 USD
6m 3m 1m
HOLT Warranted Price 39.04 (+33%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Outperform
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Below Average
Governance
87
43
72
89
HOLT takeaways: In the early 2000s, HBI under-earned relative to peers. Management focused on shareholder wealth creation principles
and shed underperforming assets and improved returns. Since the credit crisis, CFROI levels have increased almost every single year
(combination of margin expansion and asset turn improvement) and the company was able to achieve modest growth generating 7 years of
consistent increases in economic profits. With last year’s CFROI registering at over 15%, HBI now earns returns akin to US peers.
Consensus estimates suggest CFROI will continue to improve, yet the market is pricing returns to decline with falling growth. CS analyst
forecast indicate that margins may continue to improve over the next 5 years. Author: Bhumika Gashti
17.71
-0.22
Asset Turns (Sales/ Invested Capital)
N/A
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HOLT
Information Technology
John Talbott, CFA, CPA
U.S. Technology Sector Specialist
+1 212 345 1813
Ryan Ruggaard
U.S. Technology Team
+1 312 345 6129
17
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HOLT
Ticker Company Market Cap
($B)
CFROI
(LFY)
HOLT Warranted
Upside
CTSH COGNIZANT TECH SOLUTIONS 34.7 19.3% 67%CHKP CHECK POINT SOFTWARE 15.2 20.2% 30%ADS ALLIANCE DATA SYSTEMS CORP 13.6 36.3% 109%DOX AMDOCS 8.7 15.3% 4%SNPS SYNOPSYS INC 6.8 16.6% 75%OTEX OPEN TEXT CORP 6.0 26.0% 29%AVT AVNET INC 5.4 11.3% 60%ARW ARROW ELECTRONICS INC 5.3 15.0% 77%IPGP IPG PHOTONICS CORP 4.4 16.7% 43%SNX SYNNEX CORP 3.7 12.0% 31%NICE NICE SYSTEMS LTD 3.6 19.1% 32%EEFT EURONET WORLDWIDE INC 3.5 17.7% 23%EPAM EPAM SYSTEMS INC 3.4 20.9% 36%MMS MAXIMUS INC 3.2 23.5% 70%LFUS LITTELFUSE INC 2.6 12.1% 2%BDC BELDEN INC 2.3 14.2% 59%ACIW ACI WORLDWIDE INC 2.2 14.5% 14%NSR NEUSTAR INC 1.3 35.0% 251%
Information Technology: Buffett has not traditionally acquired Technology firms; however, the profile of Potential Ideas exemplify his process – above average CFROI profiles, consistent returns and low
market implied expectations.
18
Please see Appendix for screen methodology. Source: Credit Suisse HOLT Lens
HOLT Sector Specialist ideas highlighted on following pages
Portfolio CFROI profile using the “Buffett
Potential Ideas” from the table on the right.
Current Sector CFROI Profile
CFROI Profile: “Potential Buffett Ideas” Potential Buffett Ideas for Your Portfolio
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HOLT
CHECK POINT SOFTWARE TECHNOLOGIES (CHKP): Steady wealth compounder with an attractive valuation relative to software peers
19
Price Change % -2.94
0.23
8.68
-0.05
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Systems Software Market Cap $15.5B
84.35 USD
6m 3m 1m
HOLT Warranted Price 110.57 (+31%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Outperform
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Good
Governance N/A
33
45
HOLT takeaways: CHKP has historically achieved high and stable CFROI levels around 20% due to the firm’s strong margin profile, which is
best in class among software peers. However, margins have modestly declined in recent years as CHKP has ramped up investment in R&D
and go-to market initiatives in response to increased competition. The market is implying this margin compression to continue to the mid 40’s
by 2024, which may ultimately prove too bearish. 25% upside is warranted if CHKP’s investments are effective at selling new products into its
existing large installed base, allowing CHKP’s margins to remain stable long-term at 50%.
Author: John Talbott
8.11
0.00
Asset Turns (Sales/ Invested Capital)
17
33
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HOLT
MAXIMUS INC (MMS): Best in class IT Services operator that has executed on margin improvement
20
Price Change % -12.34
-3.05
-15.18
-0.03
Momentum
CFROI Revisions
Price (Mar 4, 2016)
IT Services Market Cap $3.3B
50.41 USD
6m 3m 1m
HOLT Warranted Price 86.65 (+69%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Not Rated
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Above Average
Governance N/A
85
47
72
HOLT takeaways: MMS has historically achieved CFROI levels near 20% due to MMS’s high asset efficiency relative to IT Service peers.
CFROI levels have been on the rise in recent years due to MMS’s ability to expand margins over time and to close the gap to IT Service peers.
However, the market has been skeptical on the sustainability of MMS CFROI levels since 2014 as start-up costs of new contracts have
weighed on margins. If MMS is able to execute on its margin improvement strategy and keep margins at 15% long-term coupled with long-
term sales growth of 7%, 30% upside appears warranted.
Author: John Talbott
9.57
-0.14
Asset Turns (Sales/ Invested Capital)
80
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HOLT
Healthcare
Steve Bock, CFA
U.S. Healthcare Sector Specialist
+1 312 345 6121
Adam Fuelleman, CFA
U.S. Healthcare Team
+1 312 345 6140
21
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HOLT
Ticker Company Market Cap
($B)
CFROI
(LFY)
HOLT Warranted
Upside
CAH CARDINAL HEALTH INC 27.4 18.3% 17%MYL MYLAN NV 23.1 11.8% 47%ILMN ILLUMINA INC 22.7 21.2% 3%ZBH ZIMMER BIOMET HOLDINGS INC 19.9 14.9% 6%STJ ST JUDE MEDICAL INC 15.4 16.3% 5%HSIC SCHEIN (HENRY) INC 13.8 25.1% 1%UHS UNIVERSAL HEALTH SVCS INC 11.2 12.4% 14%VAR VARIAN MEDICAL SYSTEMS INC 7.6 14.9% 18%COO COOPER COMPANIES INC 7.0 17.6% 3%TARO TARO PHARMACEUTICAL INDUSTRIES LTD6.1 24.2% 153%PDCO PATTERSON COMPANIES INC 4.4 16.6% 4%WOOF VCA INC 4.1 17.5% 5%GMED GLOBUS MEDICAL INC 2.4 14.4% 21%LIVN LIVANOVA PLC 1.5 17.4% 39%
Healthcare: By focusing on typical Buffett acquisitions, the Potential Ideas CFROI profile improves considerably (+10%). The large cash generating abilities in many of the screened firms coupled with
low market expectations may make Healthcare a potential future target.
22
Please see Appendix for screen methodology. Source: Credit Suisse HOLT Lens
HOLT Sector Specialist ideas highlighted on following pages
Portfolio CFROI profile using the “Buffett
Potential Ideas” from the table on the right.
Current Sector CFROI Profile
CFROI Profile: “Potential Buffett Ideas” Potential Buffett Ideas for Your Portfolio
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HOLT
HENRY SCHEIN (HSIC): Expectations remain reasonable despite continued growth and increasing margins
23
Price Change % 6.08
0.09
26.04
0.05
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Health Care Distributors Market Cap $13.8B
167.97 USD
6m 3m 1m
HOLT Warranted Price 174.70 (+4%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Not Rated
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Above Average
Governance Average
81
42
HOLT takeaways: HSIC's CFROI performance continues to rebound following a short negative trend in 2012 and 2013. Slowing growth in
the dental market contributed to reduced sales growth, resulting in lower asset turns as it continued to invest, depressing returns. However,
organic growth and an increase in margins have driven performance to industry best-in-class. The Distributors industry has experienced
significant consolidation over the past decade, and HSIC has continued to increase market share through acquisitions. The premiums paid in
acquisitions (goodwill) have kept Transaction CFROI low, while still helping to fuel Economic Profit creation.
Author: Steve Bock
13.59
0.08
Asset Turns (Sales/ Invested Capital)
82
76
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HOLT
MYLAN (MYL): Expectations have declined after proposed acquisition of Meda AB
24
Price Change % -12.90
0.34
-6.81
0.00
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Pharmaceuticals Market Cap $22.0B
44.78 USD
6m 3m 1m
HOLT Warranted Price 71.12 (+59%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Not Rated
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Average
Governance Good
83
59
54
HOLT takeaways: MYL historically has generated CFROI levels close to 10% with spikes due to market exclusivity and troughs related to
M&A. MYL benefited from the branded drug patent cliff which subsequently slowed in 2013. More recently, margins have continued to expand
as a result of acquisitions and new generic offerings. Asset efficiency has declined over the same period, keeping CFROI levels largely flat
since 2013. MYL's valuation declined over the past year as the takeover premium originally established by Teva Pharmaceuticals has
disappeared and the overhang of its attempted hostile bid for Perrigo is now gone; however, over the past 2 months, MYL’s has
underperformed as investors digest the large proposed acquisition premium MYL offered for Meda AB. Author: Steve Bock
-12.86
-0.15
Asset Turns (Sales/ Invested Capital)
88
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HOLT
Financials
Ben Weyers
U.S. Financials Sector Specialist
+1 312 345 6197
Stephen Price
U.S. Financials Team
+1 312 345 6188
25
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
Ticker Company Market Cap
($B)
CFROI
(LFY)
HOLT Warranted
Upside
AON AON PLC 25.8 31.8% 8%MHFI MCGRAW HILL FINANCIAL 23.8 64.2% 36%BEN FRANKLIN RESOURCES INC 21.5 17.9% 17%MCO MOODY'S CORP 17.5 36.4% 5%TROW PRICE (T. ROWE) GROUP 17.5 29.4% 48%AMTD TD AMERITRADE HOLDINGS 15.7 21.9% 34%IVZ INVESCO LTD 11.3 33.0% 63%FNF FNF GROUP 9.1 15.2% 32%CBG CBRE GROUP INC 8.8 24.2% 58%JLL JONES LANG LASALLE INC 4.8 23.8% 129%LAZ LAZARD LTD 4.3 24.3% 48%JNS JANUS CAPITAL GROUP INC 2.4 18.8% 16%WDR WADDELL&REED FINL INC 1.9 31.4% 49%LPLA LPL FINANCIAL HOLDINGS INC 1.9 22.5% 0%EVR EVERCORE PARTNERS INC 1.7 22.1% 101%
Financials: As one of Buffett’s favorite sectors, the Potential Buffett Ideas generate higher levels of CFROI than the overall sector. Market implied expectations are also well below current forecasts.
26
Please see Appendix for screen methodology. Source: Credit Suisse HOLT Lens
HOLT Sector Specialist ideas highlighted on following pages
Portfolio CFROI profile using the “Buffett
Potential Ideas” from the table on the right.
Current Sector CFROI Profile
CFROI Profile: “Potential Buffett Ideas” Potential Buffett Ideas for Your Portfolio
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
TD AMERITRADE HOLDINGS (AMTD): Strong operator at a discount to history
27
Price Change % -15.65
-1.73
-4.14
0.18
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Capital Markets Market Cap $16.7B
31.05 USD
6m 3m 1m
HOLT Warranted Price 39.49 (+27%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Neutral
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Good
Governance Average
85
71
60
56
HOLT takeaways: AMTD provides securities brokerage and related technology-based financial services to investors. AMTD has traditionally
been a strong operator with CFROI levels well above its closest peer SCHW ( ~22% vs. ~9%). AMTD’s return advantage has been driven by
both superior EBITDA margins and better asset efficiency. AMTD has sold off with the broader financials sector year to date and now has its
highest level of upside on the HOLT model since Dec ‘09.
Author: Ben Weyers
14.32
0.00
Asset Turns (Sales/ Invested Capital)
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
MOODY’S CORP (MCO): Stable margin profile and at a historic discount to MHFI
28
Price Change % -8.29
-2.20
-3.83
-1.60
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Diversified Financial Services Market Cap $18.7B
95.40 USD
6m 3m 1m
HOLT Warranted Price 90.13 (-6%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Not Rated
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Good
Governance Average
HOLT takeaways: Moody’s provides ratings, research and analytics to capital markets participants. Moody’s has generated solid CFROI
levels (~30 – 35%) on mostly positive but volatile asset growth. These return levels have been buoyed by stable to improving EBITDA margins
(MCO - 45.5% vs. MHFI – 41.5%). Asset efficiency at MCO, however, has been flat to lower (sales have slowed and cash balances have
increased). Using HOLT’s Economic PE, the market is currently valuing MCO at near all-time low levels relative to MHFI despite its
strong/stable margins and growing cash balance.
Author: Ben Weyers
13.98
-0.96
Asset Turns (Sales/ Invested Capital)
85
58
40
40
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
Industrials
Kevin Donovan
U.S. Industrials Sector Specialist
+1 617 556 5611
29
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
Ticker Company Market Cap
($B)
CFROI
(LFY)
HOLT Warranted
Upside
ETN EATON CORP PLC 26.5 18.8% 2%CMI CUMMINS INC 17.0 11.8% 37%AME AMETEK INC 11.1 25.9% 25%AYI ACUITY BRANDS INC 9.1 18.4% 20%PNR PENTAIR PLC 8.7 19.5% 30%EXPD EXPEDITORS INTL WASH INC 8.6 15.7% 5%SNA SNAP-ON INC 8.6 17.5% 56%IHS IHS INC 7.1 38.4% 73%WAB WABTEC CORP 6.6 21.9% 72%CSL CARLISLE COS INC 5.8 18.9% 34%HUBB HUBBELL INC 5.7 15.1% 2%RHI ROBERT HALF INTL INC 5.2 20.3% 22%JEC JACOBS ENGINEERING GROUP 4.8 13.7% 26%TTC TORO CO 4.4 15.7% 4%HEI HEICO CORP 3.8 23.5% 21%TDY TELEDYNE TECHNOLOGIES INC 3.0 16.3% 39%EME EMCOR GROUP INC 2.8 14.6% 2%DLX DELUXE CORP 2.8 23.6% 36%LSTR LANDSTAR SYSTEM INC 2.6 19.0% 7%ENS ENERSYS INC 2.3 13.3% 41%WCC WESCO INTL INC 1.9 20.9% 46%ASGN ON ASSIGNMENT INC 1.7 30.1% 321%AIT APPLIED INDUSTRIAL TECH INC 1.5 12.4% 25%CSTE CAESARSTONE SDOT-YAM LTD 1.3 19.6% 55%
Industrials: As one of Buffett’s most common acquisition targets, Industrials provide numerous opportunities for high quality firms with above average, stable CFROI’s coupled with low market
expectations. The Potential Buffett Ideas generate more than 600 bps higher CFROI than the sector.
30
Please see Appendix for screen methodology. Source: Credit Suisse HOLT Lens
HOLT Sector Specialist ideas highlighted on following pages
Portfolio CFROI profile using the “Buffett
Potential Ideas” from the table on the right.
Current Sector CFROI Profile
CFROI Profile: “Potential Buffett Ideas” Potential Buffett Ideas for Your Portfolio
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
SNAP-ON (SNA): Expectations remain low despite improving operations
31
Price Change % -11.38
-0.23
-0.23
-0.23
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Industrial Machinery Market Cap $8.9B
154.04 USD
6m 3m 1m
HOLT Warranted Price 236.66 (+54%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Not Rated
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Above Average
Governance Good
91
60
78
HOLT takeaways: SNA has improved CFROI levels each of the last 6 years while continually growing assets. Much of the improvement in
SNA’s CFROI levels have come from the firm’s ability to generate consistently higher margins, largely due to operating leverage and
continuous improvement initiatives designed to streamline operations. Further, during this time SNA has outperformed the market by over
200%. The current market price implies that CFROI will fall to financial crisis-levels over the next ten years.
Author: Kevin Donovan
10.11
-0.16
Asset Turns (Sales/ Invested Capital)
83
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
WABTEC CORP (WAB): Wealth Compounder priced to fade
32
Price Change % -1.54
-1.48
-17.92
-0.65
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Construction Machinery Market Cap $6.9B
75.02 USD
6m 3m 1m
HOLT Warranted Price 123.10 (+64%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Not Rated
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Good
Governance Good
80
83
HOLT takeaways: Through margin expansion and better asset efficiency, WAB has improved CFROI from 6% in 2003 to 23% in 2015 (near
peer highs). Since operations began improving, WAB has achieved positive asset growth, organic and acquisitive, which has compounded
wealth for shareholders. Current market expectations imply CFROI will fall from its 15-year peak to levels not achieved since 2005. In other
words, expectations are low for this wealth compounder stock.
Author: Kevin Donovan
20.86
-0.28
Asset Turns (Sales/ Invested Capital)
16
90
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
Materials & Energy
Vadim Vintsevsky
U.S. Resources Sector Specialist
+1 617 556 5580
33
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
Ticker Company Market Cap
($B)
CFROI
(LFY)
HOLT Warranted
Upside
PPG PPG INDUSTRIES INC 26.4 10.3% 1%POT POTASH CORP SASK INC 14.3 8.7% 37%MOS MOSAIC CO 9.5 6.7% 30%IFF INTL FLAVORS & FRAGRANCES 8.4 11.6% 10%HFC HOLLYFRONTIER CORP 6.1 11.5% 86%WLK WESTLAKE CHEMICAL CORP 5.8 12.4% 81%FTI FMC TECHNOLOGIES INC 5.6 15.0% 6%RS RELIANCE STEEL & ALUMINUM 4.4 9.6% 26%INT WORLD FUEL SERVICES CORP 3.3 14.2% 28%POL POLYONE CORP 2.3 10.5% 2%FUL FULLER (H. B.) CO 1.9 7.1% 6%DRQ DRIL-QUIP INC 2.0 13.7% 47%NP NEENAH PAPER INC 1.0 10.1% 18%
Materials & Energy: The Potential Buffett Ideas do not alleviate the cyclicality in the sector, but have generated CFROI levels 400bps greater than the overall sector with lower market expectations. Even
in these cyclical sectors, there are still a handful of ideas that pass Buffett’s general criteria.
34
Please see Appendix for screen methodology. Source: Credit Suisse HOLT Lens
HOLT Sector Specialist ideas highlighted on following pages
Portfolio CFROI profile using the “Buffett
Potential Ideas” from the table on the right.
Current Sector CFROI Profile
CFROI Profile: “Potential Buffett Ideas” Potential Buffett Ideas for Your Portfolio
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
INTERNATIONAL FLAVORS & FRAGREANCES (IFF): Resilient CFROI priced to start fading
35
Price Change % -12.24
-0.57
-0.5
-0.55
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Specialty Chem icals Market Cap $8.6B
106.41 USD
6m 3m 1m
HOLT Warranted Price 118.93 (+9%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Total Shareholder Return
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Not Rated
Operational Quality
Momentum
Valuation
Accounting Quality
Risk
Above Average
Governance Poor
80
55
69
HOLT takeaways: IFF has achieved among the most stable CFROI profiles within the Chemicals space over its history. Additionally, despite
declining asset efficiency, IFF has been able to improve EBITDA margins in recent years to achieve decade high CFROI last fiscal year. At the
current price, the market is pricing in returns to fall back to 10%, implying upside in the shares if IFF can sustain its historical levels.
Author: Vadim Vintsevsky
-10.86
-0.53
Asset Turns (Sales/ Invested Capital)
82
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
POLYONE CORP (POL): Restructuring successful
36
Price Change % -16.71
-0.67
-8.17
-0.30
Momentum
CFROI Revisions
Price (Mar 4, 2016)
Specialty Chem icals Market Cap $2.4B
28.56 USD
6m 3m 1m
HOLT Warranted Price 29.21 (+2%)
Scorecard Analysis
CFROI % (Economic Returns) Sales Growth %
Asset Growth % Margins %
Overall Percentile
CS Analyst Recommendation Not Rated
Operational Quality
Momentum
Valuation
Accounting Quality Below Average
Risk
Governance Not Rated
74
51
79
HOLT takeaways: After many years of struggling to earn their cost of capital, recent restructuring efforts have resulted in CFROI tripling (over
the course of five years) to double-digit levels. While the return improvement has come from a significant uptick in margins, the firm’s stable
asset turns was achieved through shedding assets in a negative sales growth environment. POL has an opportunity to improve CFROI further
through asset turns if sales growth comes back; which the market is currently not pricing in.
Author: Vadim Vintsevsky
15.49
-0.30
Asset Turns (Sales/ Invested Capital)
66
Total Shareholder Return
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
Appendix
37
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT 38
Screening Criteria: While many aspects of Buffett’s acquisition criteria remain the same, there are differences across sectors and industries. The following is a table detailing the criteria used in
implementing the screen for acquisition targets in the sector-specific potential idea screens.
Excluded Industries: Biotechnology, Communications Equipment, Internet Retailers, Internet Software & Services, Technology Hardware, Storage & Peripherals and Semiconductors.
¹ CFROI Spread = CFROI (LFY) minus 5-year Median CFROI
² Margin Spread = HOLT Operating Margin (LFY) minus 10-year Median HOLT Operating Margin
Excluded Sectors: Telecommunications and Utilities.
Sector Market Cap
($B)
CFROI
(Past 5
Years)
CFROI
Spread¹
Margin
Spread²
Pretax
Income
HOLT Economic
Leverage
HOLT
Accounting
Quality
HOLT Warranted
Upside
Consumer Discretionary & Staples $1 - $35 > 10% > -1 > -1 > $75mln < 40% Not "Poor" > 0%
Information Technology $1 - $35 > 10% > 0 > -2 > $75mln < 40% Not "Poor" > 0%
Healthcare $1 - $35 > 9% > -3 > -3 > $75mln < 40% Not "Poor" > 0%
Financials $1 - $35 > 10% > -3 > -3 > $75mln < 40% Not "Poor" > 0%
Industrials $1 - $35 > 10% > 0 > 0 > $75mln < 40% Not "Poor" > 0%
Energy & Materials $1 - $35 > 6% n/a n/a > $75mln < 40% Not "Poor" > 0%
Note: In BRK’s acquisition criteria listed in its annual report, it states large purchases of at least $75mln of pretax earnings.
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT 39
Outright Acquisitions of BRK: Warren Buffett’s investing principles are exemplified by the characteristics of Berkshire Hathaway’s outright acquisitions over the years. Below is a select list of
acquisitions which were used in creating the “Acquisition Portfolio”.
Company Total Transaction
Value ($B)
Announcement
Date
CFROI
(LFY -2)
CFROI
(LFY -1)
CFROI
(LFY)
HOLT Operating
Margin Sector
Burlington Northern Santa Fe LLC 38.1 11/3/2009 6.0% 5.8% 6.2% 35.8% Industrials
Precision Castparts Corp 35.6 8/10/2015 21.0% 23.6% 22.2% 31.6% Industrials
Kraft Heinz Foods Co 27.2 2/14/2013 21.3% 18.1% 17.6% 19.0% Consumer Staples
Lubrizol Corp 9.2 3/14/2011 8.8% 8.2% 13.5% 28.1% Materials
Johns Manville Corp 2.2 12/20/2000 8.2% 9.2% 14.2% 25.3% Industrials
Shaw Industries Inc 2.1 9/6/2000 6.2% 8.5% 14.0% 14.3% Consumer Discretionary
Clayton Homes Inc 1.8 4/1/2003 8.9% 5.8% 6.8% 18.8% Industrials
FlightSafety International Inc 1.5 10/15/1996 7.0% 7.4% 7.5% 51.6% Industrials
Russell Corp 1.0 4/17/2006 5.1% 5.7% 5.9% 12.2% Consumer Discretionary
Benjamin Moore & Co 1.0 11/8/2000 10.9% 12.3% 13.6% 21.5% Materials
Justin Industries Inc 0.6 6/20/2000 5.3% 5.5% 5.9% 15.8% Consumer Discretionary
Xtra Corp 0.6 7/31/2001 6.0% 5.9% 5.9% 69.2% Industrials
Dairy Queen 0.6 10/21/1997 17.8% 17.0% 17.1% 16.4% Consumer Staples
Source: Only CFROI businesses ex-utilities greater than $250 million were considered. Data sourced from Factset, Bloomberg and HOLT Lens.
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
CFROI Profiles of Select Buffett Acquisitions: All profiles are as of the month end prior to the announcement of the acquisition and demonstrate the key Buffett acquisition tenants (i.e. high CFROI
levels coupled with low expectations).
40
INT’L DAIRY QUEEN (Announced 10/21/1997)
LUBRIZOL CORP (Announced 3/14/2011)
BENJAMIN MOORE & CO (Announced 11/8/2000)
JOHNS MANVILLE (Announced 12/20/2000)
Source: Credit Suisse HOLT Lens
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT 41
Equity Portfolio Holdings of BRK: Warren Buffett’s investing principles are further exemplified by the characteristics of Berkshire Hathaway’s equity portfolio constituents.
Ticker CompanyMarket Cap
($B)
Buffett
Holding Size¹
($B)
CFROI
(LFY)
52-Week
Total Return
HOLT
Leverage
(%)
Accounting
QualitySector
WFC WELLS FARGO & CO 277.7 26.1 12.3 (9.6%) Average Financials
KHC KRAFT HEINZ CO 88.3 23.7 24.3 Average Consumer Staples
KO COCA-COLA CO 186.8 17.2 14.5 7.4% 21.4 Above Average Consumer Staples
IBM INTL BUSINESS MACHINES CORP 133.5 11.2 25.8 (15.5%) 21.5 Below Average Information Technology
AXP AMERICAN EXPRESS CO 68.5 10.5 24.6 (30.1%) Poor Financials
PSX PHILLIPS 66 43.6 5.0 4.7 6.5% 28.7 Below Average Energy
PG PROCTER & GAMBLE CO 216.0 4.2 20.6 (0.5%) 19.6 Average Consumer Staples
USB U S BANCORP 74.8 3.6 14.1 (9.3%) Above Average Financials
WMT WAL-MART STORES INC 196.3 3.4 10.9 (22.1%) 20.0 Good Consumer Staples
DVA DAVITA HEALTHCARE PARTNERS 14.7 2.7 16.5 (13.5%) 38.8 Average Health Care
MCO MOODY'S CORP 19.8 2.5 36.4 (10.4%) 16.2 Average Financials
GS GOLDMAN SACHS GROUP INC 80.3 2.0 10.5 (22.0%) Average Financials
CHTR CHARTER COMMUNICATIONS INC 20.5 1.9 6.0 (1.3%) 53.4 Poor Consumer Discretionary
DE DEERE & CO 24.2 1.7 9.6 (14.1%) 38.8 Below Average Industrials
GM GENERAL MOTORS CO 52.9 1.7 6.9 (19.9%) 49.3 Poor Consumer Discretionary
T AT&T INC 211.7 1.6 4.5 12.9% 50.3 Poor Telecommunication Services
VRSN VERISIGN INC 9.7 1.1 31.3 26.3% 17.1 Good Information Technology
USG USG CORP 3.5 0.9 6.1 (32.8%) 48.5 Poor Industrials
BK BANK OF NEW YORK MELLON CORP 45.1 0.8 9.6 (9.7%) 33.3 Poor Financials
SU SUNCOR ENERGY INC 37.3 0.8 3.7 (18.1%) 30.8 Average Energy
V VISA INC 170.7 0.8 45.3 5.8% 1.0 Good Information Technology
COST COSTCO WHOLESALE CORP 71.0 0.7 11.6 1.9% 10.7 Above Average Consumer Staples
VZ VERIZON COMMUNICATIONS INC 188.1 0.7 5.9 8.4% 43.6 Poor Telecommunication Services
MTB M & T BANK CORP 21.5 0.7 8.4 (9.5%) Below Average Financials
AXTA AXALTA COATING SYSTEMS LTD 6.3 0.6 10.8 (8.1%) 41.3 Poor Materials
LMCA LIBERTY MEDIA CORP 12.9 0.6 7.9 (12.1%) 23.3 Average Consumer Discretionary
LBTYA LIBERTY GLOBAL PLC GLOBAL GP 34.9 0.5 12.4 (25.2%) 54.0 Average Consumer Discretionary
MA MASTERCARD INC 109.3 0.5 46.3 (3.7%) 3.9 Good Information Technology
KMI KINDER MORGAN INC 33.3 0.4 5.7 (54.7%) 34.0 Poor Energy
TMK TORCHMARK CORP 7.0 0.4 15.2 (3.2%) Financials
WBC WABCO HOLDINGS INC 5.9 0.3 13.2 (22.4%) 16.9 Below Average Industrials
GE GENERAL ELECTRIC CO 294.0 0.3 14.5 17.9% 21.6 Average Industrials
QSR RESTAURANT BRANDS INTL INC 17.5 0.3 13.8 (20.2%) 35.4 Poor Consumer Discretionary
LMCA LIBERTY MEDIA CORP 12.9 0.3 7.9 (12.1%) 23.3 Average Consumer Discretionary
LBTYA LIBERTY GLOBAL PLC GLOBAL GP 34.9 0.3 12.4 (25.2%) 54.0 Average Consumer Discretionary
Source: ¹Data taken from Berkshire Hathaway’s 2015 Q4 13-F; Includes only Equity Portfolio holdings with a position size greater than $.25 bn. Data sourced from HOLT Lens.
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT
Buffett’s Equity Portfolio in HOLT: The Berkshire equity portfolio in HOLT demonstrates high CFROI levels coupled with strong margins and consistent growth.
42
CFROI (%)
Source: Credit Suisse HOLT Lens
Sales, Margins and Asset Turns
Asset Growth (%)
Metrics above represent median values of constituents.
CLARITY IS CONFIDENCE
This is market commentary and not a research document.
HOLT 43
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Authority and the Prudential Regulation Authority in the United Kingdom)
Asia: https://www.credit-suisse.com/legal/en/ib/market_commentary_disclaimer_asia.jsp
General investors in Japan should open the following link and read it: https://www.credit-suisse.com/jp/investment_banking/ja/disclaimer/