Berkowitz Finding Value in Select Sectors

Related Quotes

Symbol	Price	Change
BRK-A	111,610.00	-90.00
FAIRX	30.55	+0.31
HTZ	10.21	-0.06
HUM	46.72	-1.20
JOE	27.30	-0.60

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For legendary investor Bruce Berkowitz, the bargains in the market over the last year represented a rare opportunity.

Berkowitz saw his Fairholme Fund (Nasdaq: FAIRX - News) decline by -29.7% in 2008, but, thanks to some aggressive buying earlier in the year, Fairholme is up 32% compared to a 21% gain for the S&P 500 so far in 2009.

Like many value-focused investors, Berkowitz was using the market's desperate dips over the last year to find bargains. The fund has been particularly focused on the healthcare and defense sectors. In a letter to investors in July, Berkowitz said, "We believe many companies in these sectors are undervalued as they offer essential services and products, have few if any substitutes and have strong cash flows."

Berkowitz's newly disclosed, end-of-Q3 holdings show where he is continuing to find value.

During the quarter, Fairholme was adding to stakes in aircraft parts producer Spirit AeroSystems (NYSE: SPR - News), health insurer Humana (NYSE: HUM - News), diversified conglomerate Leucadia (NYSE: LUK - News), real estate development company The St. Joe Company (NYSE: JOE - News), and retailer Sears Holdings (NASDAQ: SHLD - News). In a reversal from recent quarters, Berkowitz also was rebuilding its stake in fellow value investor Warren Buffett's Berkshire Hathaway (NYSE: BRK-A - News, BRK-B - News).

Meanwhile, Berkowitz was trimming stakes in his largest holding, Pfizer (NYSE: PFE - News), as well as in car rental firm Hertz Global Holdings (NYSE: HTZ - News) and health insurer WellCare Health Plans (NYSE: WCG - News).

Looking at tickerspy.com's graph charting the performance of Fairholme's end-of-Q3 holdings so far in Q4, one can see that the holdings are keeping pace with the market. If you want to see how your performance stacks up to Fairholme's or just see some of the other stocks it's invested in, visit tickerspy.com to see the mutual fund's top holdings and a chart of their combined performance.

Pro portfolio performance is based on institutions' top-15 holdings as disclosed in quarter-end filings with the SEC. Pro performance does not take into account additional holdings beyond the top 15 nor does it include positions that are not required to be disclosed by the SEC. As such, Pro portfolio performance should be considered an approximation and not a precise record of how an institution has performed over time.

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