John Hussman (Trades, Portfolio) of Hussman Strategic Advisors, Inc. is known for not holding back on sharing his opinions about the government's handling of the nation's financial state. He has openly criticized the U.S. Treasury and the Federal Reserve. He is also known for predicting the U.S. Recession in 2008-2009 and since the end of 2009, he has been calling for another financial crisis to come along due to the poor policy choices made by the government.
"The combination of widening credit spreads, deteriorating market internals, plunging commodity prices, and collapsing yields on Treasury debt continues to be most consistent with an abrupt slowing in global economic activity. Generally speaking, joint market action like this provides the earliest signal of potential economic strains..." Hussman says.
Here's a look at Hussman's new four additions to his portfolio of 188 stocks, valued at $1.006 billion with a quarter over quarter turnover rate of 24%
Infosys (INFY, Financial) consists of 2% of Hussman's overall portfolio and 0.06% of the company's shares outstanding.
Hussman purchased 650,000 shares, valued at $20.4 million. The shares were purchased at an average price of $32.41/share.
Infosys was incorporated in 1981 in India as a company that designs and delivers IT-enabled solutions to its clients.
According to the chart above, the Lynch earnings line values the stock at $27.50/share, although it is currently selling at $35.36/share, meaning the stock may be overvalued.
As of today, the current P/E ratio is 20.12, and the P/B ratio is 4.90. The company's P/S ratio is 4.65, which is close to the 2-year high of 4.75.
According to GuruFocus, the company's financial strength scored a 10/10, due to the fact that Infosys has no debt, the Z-Score is 16.63, the M-Score is -3.01 and the F-Score is 5.
We also gave the company a score of 9/10 on profitability and growth becasue of its operating margin of 25.89%, net margin of 23.17, ROE is 25.30% and ROA is 20.85. A full list of ratios can be found on the stock's summary page.
Medtronic PLC (MDT, Financial)
Medtronic (MDT, Financial) consists of 1.4% of Hussman's overall portfolio and 0.02% of the company's overall shares outstanding. This is not the first time Hussman has had MDT in his portfolio. He first acquired it in 2010 during the third quarter and sold all of his shares by the second quarter of 2014. By the end of the fiscal year, he purchased 200,000 shares at an average price of $69.44/share, valued at $14.4 million.
Medtronic was founded in Minnesota in 1949 as a medical technology company that focuses on alleviating pain, restoring health and extending life for millions of people around the world.
According to the chart above, the stock is overvalued when compared to the Lynch earnings line.
The current P/E ratio is 26.02 and the P/B ratio iss 3.81. The P/S ratio is 4.36, which is close to the 5-year high of 4.45.
Hussman first added DirecTVĂ‚ (DTV, Financial) to his portfolio during the third quarter of 2011 and sold off all shares by the first quarter of 2013. He purchased 150,000 shares of DTV again at the end of the fourth quarter during 2014, at an average price of $86.04/share. The stock consists of 1.3% of his overall portfolio and is valued at $13.01 million.
DirecTV was incorporated in Delaware in 2009 as a provider of digital television entertainment in the U.S. and Latin America.
According to the Lynch earnings line, the stock is slightly overvalued, priced at $87.73/share.
The current ratio is at a comfortable 1.01, indicating good short-term financial strength.
DirecTV's P/S ratio is 1.37, which is close to the 3-year high of 1.47 and the P/E ratio is at 16.17 as sof today.
Quest Diagnostics Inc (DGX, Financial)
Quest Diagnostics (DGX, Financial) consists of 1.3% of Hussman's overall portfolio and 0.14% of the company's overall shares outstanding.
DGX is not new to the portfolio. Hussman acquired this stock in 2010, but sold off all shares by the first quarter of 2011. He added the stock once again during the fourth quarter of 2014, by purchasing 200,000 shares at an average price of $63.03/share, valued at $13.4 million.
Quest Diagnostics was incorporated in 1990 as a company that operates under two busienss groups: Diagnostics Information Services and Diagnostic Solutions Group. The Diagnostic Information Services provides clinical testing services, such as routine testing, gene-based and esoteric testing, anatomic pathology services and drugs-of-abuse testing. Patients, physicians, hospitals, IDNs, health plans and employers have access to to diagnostic information services through its network of laboratories and centers.
According to the Lynch line, this stock is undervalued. It is currently trading at $70.62/share.
The current ratio is sitting comfortably at 1.31, indicating good short-term financial strength. The P/E ratio is 20.55, P/B ratio is at 2.47 and the P/S ratio is 1.42, which is close to the 5-year high of 1.47.
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