The Covestor Long Term GARP portfolio performed poorly in the month of December as it gained 1%, worse than the 3.27% gain of the S&P 500 Index (SPX). For the year, however, the results were considerably better than the S&P 500 as the portfolio gained 41.8% while the comparable benchmark was up 32.4%.
I look for 2014 to be a very interesting and especially active year on the merger and acquisition front, especially in the technology, telecom, and media industries. As the Liberty (LINTA) family and IAC Interactive (IACI) are both active in these areas, there is always something to pay attention to.
Consider Liberty Media’s attempt to consolidate its holdings of Sirius XM (SIRI), and then potentially use it to help Charter buy Time Warner Cable (TWC). The great thing about John Malone, Greg Maffei, and Barry Diller is they are always out there trying to make things happen, in a good way, for shareholders. There is no reason to think anything will be different this year, though the outcomes are always unpredictable.
Here’s a rundown of my portfolio holdings and some updates:
Liberty Interactive (LINTA) owns QVC, Bodybuilding.com, Provide Commerce, Buyseasons.com, Backcountry.com, and large passive minority positions in other large, well known internet based business like the Home Shopping Network.
Liberty announced on October 10, 2013, it is recapitalizing the Liberty Interactive tracking stock into two new tracking stocks. One will for the internet based businesses, and the other will be centered around QVC and the position in the Home Shopping Network. Owners of Liberty Interactive will receive 1 share of the digital tracking stock for every 10 shares of the QVC tracking stock they own.
In addition, Liberty Ventures announced they will create a new tracking stock to represent their 57% voting position (22% ownership) of TripAdvisor. Liberty Ventures also has a 18% ownership position in Expedia.com and 29% ownership of Interval Leisure Group (IILG).
It also owns a variety of small percentage ownership positions in publicly traded companies like Time Warner (TWX) and Time Warner Cable (TWC). Here is a link to the list of assets owned by Liberty Interactive and Liberty Ventures:
Iconix Brands (ICON) owns a broad range of well known brands like OP, Mossimo, Joe Boxer, Peanuts, and Sharper Image.
Quest Diagnostics (DGX) is the largest health care diagnostic testing company in the United States.
Intuit (INTU) recently sold one of their divisions for about $1 billion and will use the proceeds to buy back their stock.
Starbucks (SBUX) is the largest coffee and tea company in the world.
Liberty Media (LMCA) has assets in a holding company structure that include Starz Media, the Atlanta Braves, 50% ownership of Sirius Satellite (SIRI), almost 20% ownership of Live Nation (LYV), 16% ownership of Barnes & Noble, and a few other non controlling positions of small public and private.
VCA Antech (WOOF) is the largest owner of animal hospitals in the United States also owns the laboratories for diagnostic testing of animals.
IAC Interactive (IACI) is the owner of Ask.com, Match.com, Meetic, Service Magic, Vimeo, CollegeHumor.com, and the Daily Beast, among other web sites. The company announced a reorganization to make Match.com and the dating service a separate business units.
Moneygram International (MGI) is the second largest money transfer and bill payment company behind Western Union.
British Petroleum (BP) is one of the five largest integrated oil companies in the world. BP has many projects in the pipeline all over the globe but the legal issues over the Macondo oil spill keep perceptions about the company’s prospects muted.
Unilever (UL) is massive food company based in the UK that gets over half of it’s nearly $50 billion of sales in the emerging markets of Asia and Africa. The company has a dividend yield of about 3.7% and has the goal of doubling its sales by 2020.
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DISCLAIMER: The investments discussed are held in client accounts as of December 31, 2013. These investments may or may not be currently held in client accounts. The reader should not assume that any investments identified were or will be profitable or that any investment recommendations or investment decisions we make in the future will be profitable. Past performance is no guarantee of future results.
