U.S. Markets open in 8 hrs 27 mins

Third Avenue Value Fund Buys 6 Stocks in 3rd Quarter

- By Holly LaFon

The Third Avenue Value Fund (Trades, Portfolio), formerly run by the legendary Martin Whitman, established six positions in the third quarter, it announced Monday.


Now managed by Matthew Fine and Michael Fineman, the Third Avenue Value Fund (Trades, Portfolio) buys deeply discounted, cash-rich companies, which keeps its correlation to the indexes low. At the end of the second quarter, 99.23% of its holdings were distinct from an index.

The market's fascination with high-priced indexes powered by an overweighting in soaring technology stocks has provided the fund with a number of undervalued securities. Other market forces have afforded attractive selections as well.

"If there is a thematic string running through our most recent investment activity it is that trade war rhetoric has created opportunities in a number of very good businesses with attractive long-term prospects," the managers wrote in a second-quarter letter.

At the end of the third quarter, Third Avenue Value Fund (Trades, Portfolio) listed 33 positions with a value of $970 million.

Its third-quarter new buys were: Brilliance China Automotive Holdings Ltd. (HKSE:01114), Deutsche Bank AG (XTER:DBK), Buzzi Unicem SpA (BZU.MI), Hawaiian Holdings Inc. (HA), Hutchison Port Holdings Trust (NS8U.SI) and Five Point Holdings LLC (FPH).

Brilliance China Automotive Holdings Ltd. (HKSE:01114)

The fund purchased 13,755,903 shares of the company in the third quarter when the price averaged HK$13.73 per share. The holding occupies 1.86% of the portfolio.

Brilliance China Automotive Holdings Ltd. has a market cap of HK$63.87 billion; its shares were traded around HK$12.66 with a price-earnings ratio of 9.45 and price-sales ratio of 10.16. The trailing 12-month dividend yield of Brilliance China Automotive Holdings Ltd. is 0.87%. The forward dividend yield of Brilliance China Automotive Holdings Ltd. is 1.74%. Brilliance China Automotive Holdings Ltd. had annual average earnings growth of 18.20% over the past 10 years.

Deutsche Bank AG (XTER:DBK)

The fund purchased 1,639,088 shares of the company, for a portfolio weight of 2.21%. The stock's third-quarter share price averaged 10 euros.

Deutsche Bank AG has a market cap of 20.01 billion euros; its shares were traded around 9.71 euros with a price-sales ratio of 0.80. The trailing 12-month dividend yield of Deutsche Bank AG is 1.13%. The forward dividend yield of Deutsche Bank AG is 1.13%.

Buzzi Unicem SpA (BZU.MI)

The fund purchased 1,276,478 shares of the company, for a portfolio weight of 2.89%. The stock's third quarter share price averaged 21 euros.

Buzzi Unicem SpA has a market cap of 3.49 billion euros; its shares were traded around 18.53 euros with a price-earnings ratio of 18.51. The trailing 12-month dividend yield of Buzzi Unicem SpA is 0.65%. The forward dividend yield of Buzzi Unicem SpA is 0.65%. Buzzi Unicem SpA had an annual average earnings growth of 5% over the past five years.

Hawaiian Holdings Inc. (HA)

The fund purchased 1,276,478 shares of the company, for a 1.9% portfolio weight. The stock's third quarter share price averaged $38.

Hawaiian Holdings Inc. has a market cap of $1.92 billion; its shares were traded around $37.86 with a price-earnings ratio of 5.61 and price-sales ratio of 0.72. The trailing 12-month dividend yield of Hawaiian Holdings Inc. is 1.27%. The forward dividend yield of Hawaiian Holdings Inc. is 1.26%. Hawaiian Holdings Inc. had annual average earnings growth of 18.40% over the past 10 years. GuruFocus rated Hawaiian Holdings Inc the business predictability rank of 3-star.

Hutchison Port Holdings Trust (NS8U.SI)

The fund purchased 89,278,927 shares of the company, for a 2.35% portfolio weight. The stock's third quarter share price averaged 30 cents.

Hutchison Port Holdings Trust has a market cap of $2.18 billion; its shares were traded around $0.26 with a price-earnings ratio of 25 and price-sales ratio of 1.48. The trailing 12-month dividend yield of Hutchison Port Holdings Trust is 9.94%. The forward dividend yield of Hutchison Port Holdings Trust is 8.6%.

Five Point Holdings LLC (FPH)

The fund purchased 190,610 shares of the company, for a 2.35% portfolio weight. The stock's third quarter share price averaged $12.

Five Point Holdings LLC has a market cap of $608.730 million; its shares were traded around $9.15 with a price-earnings ratio of 24.06 and price-sales ratio of 10.83.

See the fund's portfolio here.

This article first appeared on GuruFocus.