After Tough Stretch, 'mini-Berkshire' May Find Buying Opportunities
Wednesday December 3, 9:33 am ET
By the tickerspy.com Staff
Diversified holding company Leucadia National (NYSE: LUK - News) has frequently been called a "mini-Berkshire Hathaway" (NYSE: BRK-A - News, BRK-B - News) because of the firm's ability to bring in impressive returns from investments in a wide variety of sectors, ranging from medical products, to telecommunications, to wineries.
However, this year Buffett has left Leucadia in the dust. Leucadia stock has plunged about -64% year to date, and the company recently announced that it will not pay a dividend in 2008, citing "market conditions and current economics." Nonetheless, though Leucadia may report a year-over-year drop in book value, it is still trading at a discount to that book value, and the current climate has likely presented the firm with plenty of attractive investment opportunities.
Chairman and CEO Ian Cumming and President and COO Joseph Steinberg invest in a wide range of firms, but generally have stakes in just a handful of U.S.-listed equities.
During Q3, Leucadia opened a new stake in laboratory and technical furniture products manufacturer Kewaunee Scientific (Nasdaq: KEQU - News) and upped its stakes in independent auto finance company Americredit (NYSE: ACF - News) and independent oil and gas company GeoResources (Nasdaq: GEOI - News). Subsequent filings have shown that Leucadia has increased its stake in Argentinean agricultural company Cresud (Nasdaq: CRESY - News) since the end of Q3. Meanwhile, the company was trimming its stake in bank United Western Bancorp (Nasdaq: UWBK - News) during Q3.
Investors clued into Leucadia's incredible track record watch the firm's moves closely; an investment in Cumming and Steinberg's firm has returned an astonishing compounded annual growth rate of 33.9% since inception, according to Leucadia's 2007 annual report.
Leucadia largest stake at the end of Q3 was in investment bank Jefferies (NYSE: JEF - News), and it helped the company stave off the challenges of the credit crunch. Jeffries CEO Richard Handler told Reuters earlier this year that the funding from Leucadia put the bank "in a position to play offense," even as the rest of Wall Street is in a defensive crouch.
Looking at tickerspy.com's graph charting the performance of Leucadia's end-of-Q3 holdings so far during Q4, one can see that the holdings have slumped a bit, though they aren't lagging the market by too much. If you want to see how your performance stacks up to this "mini-Berkshire" or see some other Leucadia holdings, visit tickerspy.com to see the firm's top holdings and a chart of their combined performance.
Pro portfolio performance is based on institutions' top-15 holdings as disclosed in quarter-end filings with the SEC. Pro performance does not take into account additional holdings beyond the top 15 nor does it include positions that are not required to be disclosed by the SEC. As such, Pro portfolio performance should be considered an approximation and not a precise record of how an institution has performed over time
