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- By Graham Griffin
Nelson Peltz (Trades, Portfolio)'s Trian Fund Management has revealed the largest reduction this year in its Procter & Gamble Co. (NYSE:PG) holding according to GuruFocus' Real-Time Picks, a Premium feature.
Trian Fund Management was established in 2005 by co-founding partners Nelson Peltz (Trades, Portfolio), Peter William May and Edward Patrick Garden and is currently based out of New York City. The company utilizes a fundamental analysis to make its investment decisions in various public equity and alternative investment markets on a global scale, focusing on locating undervalued stocks.
On May 6, the firm cut its Procter & Gamble (NYSE:PG) holding by 34.81% with the sale of 3.09 million shares. The sale was the largest to occur since the second quarter of 2020 and marks the sixth quarter in a row that shares were sold. On the day of the transaction, the shares traded at an average price of $134.55. The sale had a -6.16% impact on the equity portfolio and GuruFocus estimates the total gain of the holding at 38.54%.
Since its founding in 1837, Procter & Gamble has become one of the world's largest consumer product manufacturers, generating more than $70 billion in annual sales. It operates with a lineup of leading brands, including 21 that generate more than $1 billion each in annual global sales, such as Tide laundry detergent, Charmin toilet paper, Pantene shampoo and Pampers diapers. P&G sold its last remaining food brand, Pringles, to Kellogg in 2012. Sales outside its home turf represent around 55% of the company's consolidated total, with around one-third coming from emerging markets.
As of May 13, the stock was trading at $135.37 per share with a market cap of $335.87 billion. According to the GF Value Line, the stock is trading at a fair value rating.
GuruFocus gives the company a financial strength rating of 6 out of 10, a profitability rank of 7 out of 10 and a valuation rank of 2 out of 10. There are currently no severe warning signs issued for the company. The company's strong profitability rank is boosted by operating and net margins that outdo over 90% of competitors and the return on invested capital has consistently supported the weighted average cost of capital over the last decade.
Other top gurus invested in Procter & Gamble include Ken Fisher (Trades, Portfolio), Diamond Hill Capital (Trades, Portfolio) and Yacktman Asset Management (Trades, Portfolio).
At the end of the fourth quarter, the firm's portfolio contained eight stocks with no new holdings. It was valued at $6.76 billion and has seen a turnover rate of 3%. Top holdings at the end of the quarter were Sysco Corp. (NYSE:SYY), Procter & Gamble, Comcast Corp. (NASDAQ:CMCSA), Mondelez International Inc. (NASDAQ:MDLZ) and Invesco Ltd. (NYSE:IVZ).
By weight, the top three sectors represented are consumer defensive (53.46%), financial services (17.35%) and communication services (15.40%).
Disclosure: Author owns no stocks mentioned.
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This article first appeared on GuruFocus.