Investor Arnold Van Den Berg Buys Another Slew of Miners in Q1

GuruFocus.com

Century Management's Arnold Van Den Berg (Trades, Portfolio) already reported his first quarter portfolio. He bought fewer stocks this quarter than in the previous quarter, with 14 new buys compared to 22. The decreased purchasing could be related to his wariness of the U.S. economy's stability. In his February note, "Inflation, Gold and Gold Mining Companies," he wrote:


"We continue to be concerned about the increasing levels of federal debt, Fed policy and quantitative easing, and the overall lack of political will to change the present course. As a result, we believe that the probability of elevated inflation over the next 5 years has dramatically increased and have been reviewing gold as a potential investment for our portfolios."

The effects of quantitative easing also trouble him, as he wrote later in the same note:

"When you consider the rate at which public debt is increasing, along with the fact that so many countries around the world instituted their own versions of quantitative easing (i.e. printing money) while increasing debt levels, these conditions are unprecedented. We have found no historical example of so many major countries simultaneously engaged in quantitative easing. Just ten years ago we would not have thought such an economic environment was even possible."

As a value investor, Van Den Berg continues to seek companies selling at discounts to their intrinsic values. Continuing his quite successful theme from last quarter, he again bought primarily an array of gold miners in the first quarter, with eight new holdings from the sector. His top first-quarter stock picks were: Markel Corp. (MKL), Apache Corp. (APA), Diamond Offshore Drilling Inc. (DO), Randgold Resources Ltd. (GOLD) and McDermott International Inc. (MDR).

Markel Corp. (MKL)

As his largest new holding Van Den Berg purchased 45,409 shares of Markel Corp., worth 2.3% of his portfolio. The stock's fourth quarter share price averaged $569.

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Markel Corporation is domiciled in Virginia. The company markets and underwrites specialty insurance products and programs to a number of niche markets and operates in three segments of the specialty insurance marketplace: the Excess and Surplus Lines, the Specialty Admitted and the London markets. Markel Corporation has a market cap of $8.34 billion; its shares were traded at around $596.27 with a P/E ratio of 25.40 and P/S ratio of 1.80. Markel Corporation had an annual average earnings growth of 14.70% over the past five years.

Apache Corp. (APA)

Van Den Berg purchased 308,809 shares of Apache Corp., worth 2.1% of his portfolio. Apache's share price averaged $82 in the first quarter.

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Apache Corporation is a Delaware corporation, which was formed in 1954. Apache Corporation has a market cap of $33.59 billion; its shares were traded at around $85.09 with a P/E ratio of 15.70 and P/S ratio of 2.20. The dividend yield of Apache Corporation stocks is 0.90%. Apache Corporation had an annual average earnings growth of 8.90% over the past 10 years. GuruFocus rated Apache Corporation the business predictability rank of 2.5-star.

Diamond Offshore Drilling Inc. (DO)

Van Den Berg purchased 308,809 shares of Apache Corp., worth 2.1% of the portfolio. The stock's share price averaged $82 in the quarter.

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Diamond Offshore Drilling Inc. was incorporated in Delaware in 1989. Diamond Offshore Drilling Inc. has a market cap of $6.92 billion; its shares were traded at around $49.76 with a P/E ratio of 12.70 and P/S ratio of 2.40. The dividend yield of Diamond Offshore Drilling Inc. stocks is 1.00%. Diamond Offshore Drilling Inc. had an annual average earnings growth of 15.10% over the past 10 years.

Randgold Resources Ltd. (GOLD)

Van Den Berg purchased 211,279 shares of Randgold Resources Inc. in the first quarter, worth 1.3% of his portfolio. The stock's price averaged $74 in the quarter.

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Randgold Resources Ltd. was incorporated under the laws of Jersey, Channel Islands in August 1995. Randgold Resources Ltd. has a market cap of $7.4 billion; its shares were traded at around $80.20 with a P/E ratio of 11.60 and P/S ratio of 6.40. The dividend yield of Randgold Resources Ltd. stocks is 0.60%. Randgold Resources Ltd. had an annual average earnings growth of 29.80% over the past 10 years. GuruFocus rated Randgold Resources Ltd. the business predictability rank of 3.5-star.

McDermott International Inc. (MDR)

Van Den Berg purchased 1,993,278 shares of McDermott International Inc. in the first quarter, worth 1.3% of the portfolio. The share price averaged $8 in the first quarter.

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McDermott International Inc. was incorporated under the laws of the Republic of Panama in 1959. McDermott International Inc. has a market cap of $1.68 billion; its shares were traded at around $7.07 with and P/S ratio of 0.60.

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