- By Graham Griffin
The New York-based company utilizes strategies that Coleman learned from Tiger Management founder Julian Robertson (Trades, Portfolio). Team members focus investments primarily in small-cap and technology stocks, but they also have an eye out for early- to late-stage venture, post-initial public offering and secondary market equities that fall within their requirements.
The recent slash in the holding represents the first time that Coleman has sold any shares since the position was established in the first quarter of 2018. On Oct. 1, the guru sold 5.02 million shares, which were trading for an average price of $79.97 on the day of the transaction. Overall, the sale had a -1.56% impact on the portfolio and GuruFocus estimates the total gain of the holding at 503.82%.
At the end of the first quarter, Coleman's portfolio included 73 stocks, with four new holdings. By weight, the portfolio is most invested in the technology (35.88%), consumer cyclical (28.60%) and communication services (20.74%) sectors.
New holdings at the end of the second quarter included Zoominfo Technologies Inc. (NASDAQ:ZI), Agora Inc. (NASDAQ:API), Dada Nexus Ltd. (NASDAQ:DADA) and Kingsoft Cloud Holdings Ltd. (NASDAQ:KC).
Sunrun provides homeowners with clean, affordable solar energy and storage. It engages in the design, development, installation, sale, ownership and maintenance of residential solar energy systems in the U.S. It also sells solar leads. Solar service offerings are provided through leases and power-purchase agreements.
On Oct. 6, the stock was trading at $76.35 per share with a market cap of $10 billion. According to the GuruFocus Value Line, the shares are significantly overvalued and a similar conclusion can be drawn based on the Peter Lynch chart.
GuruFocus gives the company a financial strength rating of 2 out of 10 and a profitability rank of 4 out of 10. There are currently six severe warning signs issued for the company. The company has struggled with long-term debt, leading to a cash-to-debt ratio of 0.1, placing it lower than 93.99% of the industry. An Altman Z-Score of 1.33 places it in the distress column with bankruptcy a possibility as cash flows become increasingly negative.
Coleman is the largest guru shareholder with 19.51% of shares outstanding. Other top shareholders include BlackRock Inc. (Trades, Portfolio), Vanguard Group Inc. (Trades, Portfolio), Van Eck Associates Corp. (Trades, Portfolio), Neuberger Berman Group LLC (Trades, Portfolio) and State Street Corp. (Trades, Portfolio).
Disclaimer: Author owns no stocks mentioned.
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This article first appeared on GuruFocus.