Jerome Dodson’s Parnassus Fund – GuruFocus.com

Jerome Dodson (Trades, Portfolio) ‘s Parnassus fund recently unveiled its portfolio updates for the third quarter of 2021, which ended on September 30.

The strategy of the Parnassus Fund is to seek long-term capital appreciation through securities that have wide gaps, long-term relevance, quality management teams, positive performance on environmental, social and financial criteria. governance (ESG) and a market price below intrinsic value.

Dodson, the founder of Parnassus Investments, resigned from the board effective January 1 and will no longer manage the funds, although he will remain chairman of the board. In July, Affiliated Managers Group announced that it was paying $ 600 million to acquire a controlling stake in Parnassus Investments, so more changes may be underway for the company and its funds.

According to the latest 13F file, the fund made three new purchases during the quarter: Match Group Inc. (MTCH, Financial), Okta Inc. (OKTA, Financial) and StoneCo Ltd. (STNE, Financial). Notable sales included Fair Isaac Corp. (FICO, Financial) and Grocery Outlet Holding Corp. (GO, Financial).

Match group

The fund has formed a participation worth 168,730 shares in Match Group (MTCH, Financial), giving the stock a weighting of 2.45% in the equity portfolio. During the quarter, the shares traded at an average price of $ 152.33.

Match Group is a Dallas-based online dating services company. It has a near-total monopoly on the world’s leading online dating services with 45 brands in total, including Tinder, Match.com, Meetic, OkCupid, Hinge, PlentyOfFish, Ship, and OurTime.

On October 20, Match Group shares were trading around $ 159.01 for a market cap of $ 44.83 billion. According to the GuruFocus Value chart, the stock is significantly overvalued.

The company has a financial strength rating of 4 out of 10 and a profitability rating of 7 out of 10. The cash-to-debt ratio of 0.07 is lower than 97% of its industry peers, but the Piotroski F-Score of 6 out of 9 indicates the financial situation is stable. Return on invested capital is typically greater than the weighted average cost of capital, which means the company creates shareholder value.

1450925414372347904.png

Okta

The fund bought 88,581 Okta shares (OKTA, Financial), giving the stock a weighting of 1.95% in the equity portfolio. The shares traded at an average price of $ 248.53 during the quarter.

Okta is a San Francisco-based identity and access management software company. It provides cloud-based software that helps businesses manage and secure user authentication and create identity checks across apps, websites, web services, and devices.

On October 20, Okta shares were trading around $ 256.41 for a market cap of $ 39.66 billion. According to the GF Value chart, the stock is valued at its fair value.

1450925727531667456.png

The company has a financial strength rating of 5 out of 10 and a profitability rating of 2 out of 10. The Piotroski F-Score of 4 out of 9 and Altman Z-Score of 8.27 show that the company is not at risk of coping. to liquidity problems. . Both operating margin and net margin are in the negative range, so the business is probably far from profitable.

1450926192499625984.png

StoneCo

The Fund also invested in 545,524 shares of StoneCo Ltd. (STNE, Financial), giving the stock a weighting of 1.75% in the equity portfolio. During the quarter, the shares traded at an average price of $ 52.07.

StoneCo is a Brazilian financial technology company that provides an end-to-end, cloud-based technology platform for merchants and integrated partners to perform e-commerce across in-store, online and mobile channels.

Warren Buffett (Trades, Portfolio) is also known to hold a stake in this company.

On October 20, StoneCo shares were trading around $ 39.32 for a market cap of $ 12.17 billion. According to the Peter Lynch chart, the stock is trading above its intrinsic value but below its historic median valuation.

1450926583253569536.png

The company has a financial strength rating of 4 out of 10 and a profitability rating of 5 out of 10. At 2.95, the interest coverage ratio is lower than 89% of its industry peers, although the Piotroski F- Score of 4 out of 9 indicates the balance sheet is stable. The company has a three-year revenue per share growth rate of 37.4% and a three-year EBITDA per share growth rate of 73.6%.

1450927124763381760.png

Just Isaac

The fund sold its stake of 43,769 shares in Fair Isaac (FICO, Financial), impacting the equity portfolio by -1.95%. The shares traded at an average price of $ 475.97 during the quarter.

1450919676509949952.png

Fair Isaac, better known to most Americans as FICO, is a credit rating company based in San Jose, California. It provides one of the three main credit scores used to measure consumer credit risk, determining how much each person can borrow and at what rates.

On October 20, shares of Fair Isaac were trading around $ 409.84 for a market cap of $ 11.66 billion. According to the GF Value chart, the stock is valued at its fair value.

1450927356523843584.png

The company has a financial strength rating of 5 out of 10 and a profitability rating of 9 out of 10. The cash-to-debt ratio of 0.21 is on the low end of the spectrum, but the Altman Z-Score of 8.09 shows that the company is not in danger of bankruptcy. ROIC is typically higher than WACC, which means the business creates value as it grows.

1450927690621128704.png

Running a food store

The Fund also liquidated its investment of 480,372 shares in Grocery Outlet Holding (GO, Financial), which had an impact of -1.48% on the equity portfolio. During the quarter, the shares traded at an average price of $ 28.81.

1450920155373637632.png

Grocery Outlet operates a chain of discount supermarkets that offer overstock and clearance products from a wide variety of suppliers. The California-based company has stores in California, Oregon, Washington, Idaho, Nevada and Pennsylvania.

On October 20, shares of Grocery Outlet were trading around $ 23.05 for a market cap of $ 2.22 billion. According to the Peter Lynch chart, the stock is trading above its intrinsic value but below its historic median valuation.

1450927893587693568.png

The company has a financial strength rating of 4 out of 10 and a profitability rating of 4 out of 10. The Piotroski F-Score of 6 out of 9 and Altman Z-Score of 2.37 show that the company is not. likely to go bankrupt within the next two years. The company has a three-year revenue per share growth rate of 4.4% and a three-year EBITDA growth rate of 2.5%.

1450929221596614656.png

Portfolio overview

At the end of the quarter, the fund held shares of 42 common stocks valued at a total of $ 1.08 billion. The turnover rate for the quarter was 7%.

The main titles were Cadence Design Systems Inc. (CDNS, financial) with 4.22% of the equity portfolio, Agilent Technologies Inc. (A, Financial) with 4.03% and Old Dominion Freight Line Inc. (ODFL, financial) with 3.85%.

In terms of sector weighting, the fund was primarily invested in technology, healthcare and consumer discretionary.

1450908620559486976.png


Source link

Comments are closed.