Every year Barron’s gets its Roundtable team together and they discuss stock picks and the status of the economy in general. Â Guru Brian Rogers (Trades, Portfolio) is a member of Barron’s Roundtable team, and the following stocks are his stock picks for 2013 and how they ended up doing for the year.Â
PNC Financial Services Group (PNC)
Last year Brian Rogers (Trades, Portfolio) recommended to Barron’s the stock PNC Financial Services Group. On Jan. 11, 2013, when Rogers recommended the stock, the company was trading at around $60.05 per share and at year-end the company was up 29.2% to $77.58 per share. For 2013 PNC Financial delivered a total return of 31.4%.
At year’s end, Rogers held on to 5,000,000 shares of PNC Stock, representing 1.4% of his total portfolio and 0.94% of the company’s shares outstanding. The guru did not alter his position in the company over the past quarter; the last time he changed his holdings was in the first quarter of 2013.
Rogers’ historical holding history:
PNC Financial Services is a diversified financial services company in the United States. It is engaged in the business of retail banking, corporate and institutional banking, asset management and residential mortgage banking.
PNC Financial Services’ historical revenue and net income:
The company recently reported their fourth quarter and full year 2013 financial results which highlighted:
- 2013 net income of $4.2 billion, or $7.39 per share, up from $3.0 billion and $5.30 per share.
- Fourth quarter net income of $1.1 billion up from $1 billion last year.
- Noninterest income of $1.8 billion increased $121 million from last quarter.
- Credit losses declined to $113 million during the fourth quarter.
The Peter Lynch Chart suggests that the company is currently undervalued:
PNC Financial has a market cap of $43.28 billion. Its shares are currently trading at around $81.33 with a P/E ratio of 11.90, a P/S ratio of 2.70 and a P/B ratio of 1.10. The dividend yield of PNC stocks is at 2.10%, and the company had an annual average earnings growth of 6.10% over the past ten years.
Kohl’s (KSS)
Another one of Rogers’ recommendations was for the company Kohl’s Corp. At the time of the 2013 Roundtable article Kohl’s was trading at $42.02, and as of year-end the price per share has increased 35.1% to $56.75 per share. For 2013 Post Holdings delivered a total return of 31.4%.
Rogers held on to a total of 5,750,000 shares of Kohl’s as of the fourth quarter. His position makes up for 1.2% of his total portfolio as well as 2.60% of the company’s shares outstanding. The guru hasn’t altered his position in Kohl’s since the first quarter, and since then the price per share is up about 12.4%.Â
Rogers’ holding history as of the fourth quarter:
Kohl’s operates family-oriented department stores that sell moderately-priced apparel, footwear and accessories for women, men and children; soft home products such as sheets and pillows; and housewares. The company's stores generally carry a consistent merchandise assortment.
Kohl’s historical revenue and net income:
The analysis on Kohl’s reports that the company has issued $830 million in debt over the past three years but that its debt level is acceptable. It also notes the company has shown predictable revenue and earnings growth as well as an expanding operating margin.
The Peter Lynch Chart suggests that the company is currently undervalued:
Kohl’s has a market cap of $10.77 billion. Its shares are currently trading at around $50.30 with a P/E ratio of 12.10, a P/S ratio of 0.60 and a P/B ratio of 1.90. Kohl’s had an annual average earnings growth of 12.80% over the past ten years.Â
GuruFocus rated Kohl’s the business predictability rank of 4.5-star.
Apache (APA)
Rogers recommended the company Apache for Barron’s Roundtable last year. On Jan. 11, 2013, the company was trading at $80.57 per share and at year-end the company’s price had increased approximately 6.7% to $85.94 per share. For the year Apache delivered a total return of 7.6%.
Brian Rogers (Trades, Portfolio) holds on to 6 million shares of Apache, representing 1.9% of his total portfolio and 1.54% of the company’s shares outstanding. Rogers did not change his position in the company over the past quarter. Since his most recent transaction in the third quarter the price per share is up a slight 0.6%.Â
Rogers’ historical holding history:
Apache Corp. is an independent energy company that explores, develops and produces natural gas, crude oil and natural gas liquids. It has exploration and production interests in six countries, divided into seven operating regions: the U.S., Canada, Egypt, Australia, the U.K. in the North Sea and Argentina.
Apache’s historical revenue and net income:
The analysis on Apache reports that the company’s price is nearing a one-year high, the company has issued $6.1 billion over the past three years, the revenue has slowed down over the past year and its operating margin is expanding.
The Peter Lynch Chart suggests that the company is currently undervalued:
Apache has a market cap of $32.96 billion. Its shares are currently trading at around $82.55 with a P/E ratio of 12.30, a P/S ratio of 2.00 and a P/B ratio of 1.00. Apache had an annual average earnings growth of 12.5% over the past 10 years.
GuruFocus rated Apache the business predictability rank of 2.5-star.
Avon Products (AVP)
Another one of Rogers’ recommendations was for the company Avon Products. At the time of the 2013 Roundtable article Avon was trading at $15.22, and as of year-end the price per share has increased 13.1% to $17.22 per share. For 2013 McKesson delivered a total return of 14.7%.
As of year-end Rogers held on to 10,132,400 shares of Avon, represThe guru did not alter his position in the company over the past quarter.
Rogers’ historical holding history as of the fourth quarter:
Avon is a manufacturer and marketer of beauty and related products. The company's product categories are Beauty, Fashion and Home.
Avon’s historical revenue and net income:
The analysis on Avon reports that the company’s revenue has been in decline over the past year, its operating margin has been in a 5-year decline and its P/B and P/S ratios are trading at near 1-year lows.
Over the past quarter Avon released their plan to their proposed cost savings plan. The company wishes to reduce costs by $400 million by 2016. The latest actions primarily consisted of global headcount reductions, including those related to the company’s service model transformation (SMT) project, and some additional headcount reductions in North America, as the company continues to reduce costs and improve organizational effectiveness.
Avon has a market cap of $6.7 billion. Its shares are currently trading at around $15.45 with a P/S ratio of 0.70 and a P/B ratio of 6.00.  The company also holds a dividend yield of 1.50%.
Legg Mason (LM)
Rogers recommended the company Legg Mason for Barron’s Roundtable last year. On Jan. 11, 2013, the company was trading at $26.52 per share and at year-end the company’s price had increased approximately 64% to $65.8 per share. For the year Legg Mason delivered a total return of 65.8%.
Rogers holds on to 6,226,200 shares of Legg Mason stock, representing 0.98% of his total portfolio as well as 5.05% of the company’s shares outstanding. During the fourth quarter Rogers cut his holdings a slight -1.58% by selling 100,000 shares. Since his sell the price per share is up approximately 13.3%.
Rogers’ holding history of Legg Mason as of Q4:
Legg Mason is a global asset management company that acts through various subsidiaries to provide asset management and related services to institutional and individual clients, company-sponsored mutual funds and other pooled investment vehicles. The company offers these products and services directly and through various financial intermediaries.
Legg Mason’s historical revenue and earnings growth:
The analysis on Legg Mason reports that the company’s price is at a 2-year high, its P/S ratio is also at a 2-year high and that its revenue has been in decline over the past five years.
The company announced that it would be releasing its third quarter 2014 results on Jan. 31, 2014 before market open.
Legg Mason announced their expected third fiscal quarter earnings on Jan. 13 which highlighted:
- Higher expected effective tax rate of 36%, compared to 18% in the second quarter.
- Expected net income to be in the range of $0.65 to $0.68 per share, or $79 million to $83 million.
- Expected earnings will include approximately $48 to $52 million in performance fees, as compared to $17 million in the previous quarter.
- As of Dec. 31, the fund holds approximately $680 billion AUM.
Legg Mason has a market cap of $4.3 billion; its shares were traded at around $33.59 with a P/E ratio of 24.20 and a P/S ratio of 1.70. The dividend yield of Legg Mason stocks is at 1.40%.
General Electric (GE)
Another one of Rogers’ favored stocks of the past year was in General Electric. The price of the company was at $21.13 per share on Jan. 11, 2013, and as of year-end the company’s price was trading up about 32.7% to $28.03 per share. For the year Patterson delivered total returns of 36.4%.
As of the fourth quarter Rogers holds on to 31,286,500 shares of GE stock, representing 3.2% of his total portfolio as well as 0.31% of the company’s shares outstanding. The guru has not changed his holdings in the company since the fourth quarter of 2011, and since then the price per share is up approximately 58%.
Rogers’ historical holding history:
GE is a diversified infrastructure and financial services company. The company provides products and services ranging from aircraft engines, power generation, water processing, and security technology to medical imaging, business and consumer financing, media content and industrial products.
General Electric’s historical revenue and net income:
The company announced that they had launched 14 new industrial internet productivity technologies which will improve the outcomes for aviation, oil & gas, transportation, healthcare and energy.
The Peter Lynch Chart suggests that the company is currently overvalued:
General Electric has a market cap of $252.83 billion. Its shares are currently trading at around $24.99 with a P/E ratio of 18.80, a P/S ratio of 1.80 and a P/B ratio of 2.10. The company had an annual average earnings growth of 7.30% over the past ten years.
Check out the Barron’s article here.
You can view Brian Rogers entire fourth quarter portfolio here.
