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Mario Gabelli Reduces Stake in Superior Industries International

Mario Gabelli (Trades, Portfolio) is the founder, chairman, and CEO of Gabelli Asset Management Company Investors (GAMCO Investors) a $30 billion dollar global investment firm headquartered in Rye, New York.


New Level

The investor reported reducing his stake in Superior Industries International (SUP) on April 1, according to GuruFocus Real Time Picks .

With the transaction, Gabelli's position decreased by 2.4% to 2,081,301 shares. The fund initiated a position more than five years ago, and during 2014, Gabelli added and reduced the stake to reach 2.1 million shares at the end of the fourth quarter of 2014, worth $41.98 million. On March 19, the guru has added the stock to reach 2,132,001 shares, but now he sold 50,700 shares. The stock price has risen by 2.26% in that time frame, so he took advantage of that price appreciation and took the gains.

Superior Industries International's shares lost 4.1% during the past year and closed 2014 at a price of $19.79 each. Today, the stock price trades at a lower level.

The Company

Superior Industries designs, manufactures, and sells aluminum road wheels to original equipment manufacturers in North America. It also has a $517.83 million market cap. For the fourth quarter, revenues decreased by 3.04% but earnings per share decreased in the most recent quarter compared to the same quarter a year ago ($0.05 vs $0.23). During the past fiscal year, the firm reported lower earnings of $0.32 versus $0.83 in the previous year. This year, Wall Street expects an improvement in earnings ($0.87 versus $0.32). The net income decreased by almost 79% when compared to the same quarter one year ago, to $1.36 million from $6.40 million.

Relative Valuation

In terms of valuation, the stock sells at a trailing P/E of 59.9x, trading at a premium compared to an average of 21.1x for the industry. To use another metric, its price-to-book ratio of 1.17x indicates a discount versus the industry average of 1.91x while the price-to-sales ratio of 0.70x is below the industry average of 0.79x.

Other Hedge Funds

Hedge fund guru John Rogers (Trades, Portfolio) upped the stake by 9% to 128,375 shares in the fourth quarter of 2014, while John Keeley (Trades, Portfolio) sold out the stock.

Chuck Royce (Trades, Portfolio) is the third-largest investor in the company as it reported holding 488,000 shares, with no changes on the quarter. However, this position didn�t represent a significant portion of Mr. Royce's portfolio, reaching 0.03% of the total value.

Disclosure: Omar Venerio holds no position in any stocks mentioned

This article first appeared on GuruFocus.

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