ValueAct Capital Trims CBRE Group Stake, Adds To Trinity Industries

Jeff Ubben's activist firm ValueAct Capital has submitted two SEC filings recently.

ValueAct Trims CBRE Group Stake

First, in an amended 13D with the SEC regarding its stake in CBRE Group (CBG), ValueAct now reports they own 5.9% of the company with 19.91 million shares.

The 13D indicates ValueAct sold 5 million CBG shares on March 1st at a price of $45.78.  This is the third time they've made filings indicating they've reduced their position over the past 6 months.

Per Google Finance, CBRE Group is "a holding company that conducts all of its operations through its subsidiaries. The Company operates as a commercial real estate services and investment company. The Company operates through the segments: The Americas; Europe, Middle East and Africa (EMEA); Asia Pacific; Global Investment Management, and Development Services. The Company provides commercial real estate services under the CBRE brand name, investment management services under the CBRE Global Investors brand name and development services under the Trammell Crow Company brand name. The Company's business is focused on commercial property, corporate facilities, project and transaction management, tenant/occupier and property/agency leasing, capital markets solutions (property sales, commercial mortgage brokerage, loan origination and servicing) real estate investment management, valuation, development services and proprietary research. "


ValueAct Adds To Trinity Industries Position

Second, ValueAct has also filed a Form 4 with the SEC regarding its position in Trinity Industries (TRN).  Per that filing, ValueAct acquired 950,000 TRN shares across February 28th, and March 1st and 2nd. 

They purchased shares around the $32.85 level and after these buys now own over 19.55 million TRN shares.

Per Google Finance, Trinity Industries is "a diversified industrial company that owns businesses providing products and services to the energy, chemical, agriculture, transportation and construction sectors. The Company's products and services include railcars and railcar parts; parts and steel components; the leasing, management and maintenance of railcars; highway products; construction aggregates; inland barges; structural wind towers; steel utility structures; storage and distribution containers, and trench shields and shoring products. The Company's segments include the Rail Group, Construction Products Group, Inland Barge Group, Energy Equipment Group, Railcar Leasing and Management Services Group, and All Other. Its All Other segment includes its captive insurance and transportation companies, and other peripheral businesses. It manufactures a line of railcars, including autorack cars, box cars, covered hopper cars, gondola cars, intermodal cars, open hopper cars and tank cars."

ValueAct Capital Boosts KKR Stake, Trims CBRE Group

Jeff Ubben's activist firm ValueAct Capital has made a few notable transactions recently.


ValueAct Boosts KKR Stake

First, ValueAct has filed a 13D with the SEC regarding its stake in KKR (KKR).  Per the filing, ValueAct now owns 9.99% of the private equity firm with 47.75 million shares.

Per the filing, ValueAct was buying KKR shares throughout mid-to-late November.  They bought between $19.19 and $19.50 and in total acquired 2.19 million shares.

You can view the rest of ValueAct's portfolio here.

Per Google Finance, KKR is "a global investment firm that manages multiple alternative asset classes, including private equity, energy, infrastructure, real estate, credit, and, through its strategic partners, hedge funds."


Ubben's Firm Sells More CBRE Group

Second, in a series of Form 4's filed with the SEC, ValueAct has disclosed a sale of over 3 million shares of CBRE Group (CBG).  They sold 2.3 million shares at $42.25 on November 28th, sold another 600,000 at $42.57 on November 27th, and sold 246,000 on November 22nd.  After all these sales they still own over 24.91 million shares.

Per Google Finance, CBRE Group is "CBRE Group, Inc. is the largest commercial real estate services and investment firm in the world. It is based in Los Angeles, California and operates more than 450 offices worldwide and has clients in more than 100 countries."

You can view the rest of ValueAct's portfolio here.

ValueAct Trims CBRE Group Position

Jeff Ubben's activist firm ValueAct Capital has been busy lately.  In an amended 13D filed with the SEC, ValueAct has disclosed that they now own 8.5% of CBRE Group (CBG) with 28.87 million shares.

This is down from the 34.37 million shares they owned at the end of the second quarter.  In their most recent activity, the filing notes they sold 5.5 million shares at $35.90 in a block trade on September 15th.

For more on this firm, yesterday we highlighted how ValueAct added to its KKR stake again.

Per Google Finance, CBRE Group "operates as a commercial real estate services and investment company. The Company operates through the segments: The Americas; Europe, Middle East and Africa (EMEA); Asia Pacific; Global Investment Management, and Development Services. The Company provides commercial real estate services under the CBRE brand name, investment management services under the CBRE Global Investors brand name and development services under the Trammell Crow Company brand name. The Company's business is focused on commercial property, corporate facilities, project and transaction management, tenant/occupier and property/agency leasing, capital markets solutions (property sales, commercial mortgage brokerage, loan origination and servicing) real estate investment management, valuation, development services and proprietary research."

What We're Reading ~ 11/30/16

Warren Buffett's meeting with University of Maryland students [UMD]

Is the next financial crisis on its way? [Steve Eisman]

A write-up on the impending Hilton (HLT) spinoff [Clark Street Value]

CBRE (CBG): industry deep dive to detect an emerging moat [Punch Card]

A look at Discovery Communications (DISCA/K) [Contrarian Edge]

Sustainable sources of competitive advantage [Collaborative Fund]

Why deep learning matters and what's next for AI [Algorithmia]

The unexpected genius of Facebook's Mark Zuckerberg [Fortune]

Google's online travel adventure upsets its biggest advertisers [Bloomberg]

A billionaire's dreams of creating a guns empire [NYMag]

If oil refiners crash, so will the economy [WSJ]

Mastercard, Visa set to reap spoils of India's war on cash [Bloomberg]

How Best Buy (BBY) fought Amazon [WSJ]

The evolution of media & entertainment: conversation with CEOs [YouTube]

How to get comfortable with being umcomfortable [Inc]

Why gut feelings may really help you make risky decisions [Washington Post]

Why stoicism is one of the best mind-hacks ever devised [Aeon]

ValueAct Capital Buys More CBRE Group & Trinity Industries, Trims Allison Transmission

Jeff Ubben's activist firm ValueAct Capital has submitted three filings to the SEC regarding some of their portfolio positions.

ValueAct Buys More CBRE Group (CBG)

First, Ubben's investment firm has been out acquiring more shares of CBRE Group (CBG) per a Form 4 filed with the SEC.

On October 28th and 31st, as well as November 1st, ValueAct acquired over 2.21 million shares in total at prices of around $25.8x.  After all these buys, they now own over 36.83 million shares.  The filing also notes that a little over 600,000 of these shares were made as part of a 10b5-1 plan.  We've highlighted recently how ValueAct has been acquiring CBG shares.

For more on this firm, be sure to also check out Mason Morfit's presentation (he's a ValueAct partner) at the Sohn San Francisco conference.

Per Google Finance, CBRE Group is "a commercial real estate services and investment company.  It offers services to occupiers, owners, lenders and investors in office, retail, industrial, multifamily and other types of commercial real estate. It offers commercial real estate services under the CBRE brand name, investment management services under the CBRE Global Investors brand name and development services under the Trammell Crow Company brand name. It is focused on several competencies, including commercial property, corporate facilities, project and transaction management, tenant/occupier and property/agency leasing, capital markets solutions, real estate investment management, valuation, development services and proprietary research."


Acquired More Trinity Industries (TRN) Shares

Second, ValueAct has also filed an amended 13D on their position in Trinity Industries (TRN).  They were out buying TRN shares in August and September and that continued in October.

Per the filing, they acquired 2.9 million shares in October at prices ranging from $21.09 to $23.68.  ValueAct now owns 9.8% of Trinity Industries with over 14.92 million shares.

Per Google Finance, Trinity Industries is "a diversified industrial company that owns a range of businesses providing products and services to the energy, transportation, chemical and construction sectors. The Company's products and services include railcars and railcar parts; parts and steel components; the leasing, management and maintenance of railcars; highway products; aggregates; inland barges; structural wind towers; steel utility structures; storage and distribution containers, and trench shields and shoring products."


Trimmed Allison Transmission (ALSN) Stake

Lastly, in an amended 13D regarding its position in Allison Transmission (ALSN), ValueAct has trimmed their stake in the company and now own 9% of ALSN with 14.82 million shares.

This is down from the 19.12 million shares they owned at the end of the second quarter.  The filing was made due to activity on October 27th and notes they sold 4.3 million shares at $28.20 per share.

For more on this firm, we posted up some other recent portfolio activity from ValueAct here.

Per Google Finance, Allison Transmission is "design and manufacture commercial and defense fully-automatic transmissions. The Company manufactures fully-automatic transmissions for medium- and heavy-duty commercial vehicles and medium-and heavy-tactical the United States defense vehicles. The Company operates through manufacture and distribution of fully-automatic transmissions segment. The Company's transmissions are used in a range of applications, including on-highway trucks (distribution, refuse, construction, fire and emergency), buses (primarily school, transit and hybrid-transit), motorhomes, off-highway vehicles and equipment (energy, mining and construction) and defense vehicles (wheeled and tracked). The Company's transmissions are sold under the Allison Transmission brand name and remanufactured transmissions are sold under the ReTran brand name. The Company has developed over 100 different models that are used in over 2,500 different vehicle configurations."

ValueAct Capital Files 13D's on Trinity Industries, CBRE Group

Jeff Ubben's activist firm ValueAct Capital has filed two amended 13D's with the SEC.

ValueAct Ups Trinity Industries Stake

First, Jeff Ubben's firm has disclosed it now owns 7.9% of Trinity Industries (TRN) with over 12 million shares.  This is up from the 10.39 million shares they owned as of July.

The filing indicates they were buying in mid August and early September at prices of $23.xx.  The 13D also says they intend to meet with management and the board about ways to enhance shareholder value.

For more from this firm, check out some of ValueAct's other recent portfolio activity.

Per Google Finance, Trinity Industries is "a diversified industrial company that owns a range of businesses providing products and services to the energy, transportation, chemical and construction sectors. The Company's products and services include railcars and railcar parts; parts and steel components; the leasing, management and maintenance of railcars; highway products; aggregates; inland barges; structural wind towers; steel utility structures; storage and distribution containers, and trench shields and shoring products. The Company's segments include the Rail Group, Railcar Leasing and Management Services Group, Construction Products Group, Energy Equipment Group, Inland Barge Group and All Other Groups. Its Rail Group is a manufacturer of freight and tank railcars in North America used for transporting a range of liquids, gases and dry cargo, through Trinity Rail Group. The Company's Railcar Leasing and Management Services Group is a provider of rail industry services in North America."


Ubben's Firm Files 13D on CBRE Group

Second, ValueAct Capital has filed a 13D with the SEC on CBRE Group (CBG), which they own 10.3% of with over 34.6 million shares.  This stake remains unchanged from August when we reported that ValueAct added to its CBG position.

The 13D contains the standard boilerplate that they will talk with management and the board about enhancing shareholder value and also highlights that one of their partners, Brandon Boze, is on the board of directors.

Per Google Finance, CBRE Group is "a holding company that conducts all of its operations through its subsidiaries. The Company is a commercial real estate services and investment company. The Company operates through the segments: The Americas; Europe, Middle East and Africa (EMEA); Asia Pacific; Global Investment Management, and Development Services. It offers services to occupiers, owners, lenders and investors in office, retail, industrial, multifamily and other types of commercial real estate. It offers commercial real estate services under the CBRE brand name, investment management services under the CBRE Global Investors brand name and development services under the Trammell Crow Company brand name. It is focused on several competencies, including commercial property, corporate facilities, project and transaction management, tenant/occupier and property/agency leasing, capital markets solutions, real estate investment management, valuation, development services and proprietary research."

ValueAct Capital Buys More CBRE Group Shares

Last week, we highlighted how Jeff Ubben's activist firm ValueAct Capital added to its CBRE Group position.  They've filed another Form 4 indicating they acquired some more shares recently.

The filing notes ValueAct bought 182,060 CBG shares on August 4th at a price of $28.50.  This brings their total ownership up to over 34.62 million shares.

Per Google Finance, CBRE Group is "a holding company that conducts all of its operations through its subsidiaries. The Company is a commercial real estate services and investment company. The Company operates through the segments: The Americas; Europe, Middle East and Africa (EMEA); Asia Pacific; Global Investment Management, and Development Services. It offers services to occupiers, owners, lenders and investors in office, retail, industrial, multifamily and other types of commercial real estate. It offers commercial real estate services under the CBRE brand name, investment management services under the CBRE Global Investors brand name and development services under the Trammell Crow Company brand name. It is focused on several competencies, including commercial property, corporate facilities, project and transaction management, tenant/occupier and property/agency leasing, capital markets solutions, real estate investment management, valuation, development services and proprietary research." 

ValueAct Capital Buys More CBRE Group

Jeff Ubben's activist firm ValueAct Capital has filed a Form 4 with the SEC regarding their position in CBRE Group (CBG).

Per the filing, ValueAct was buying shares on August 1st, 2nd, and 3rd at prices around $28.40.  In total, they bought 1,502,200 shares.  After these purchases, they now own over 34.43 million shares of CBG.

You can view other recent portfolio activity from ValueAct here.

Per Google Finance, CBRE Group is "a holding company that conducts all of its operations through its subsidiaries. The Company is a commercial real estate services and investment company. The Company operates through the segments: The Americas; Europe, Middle East and Africa (EMEA); Asia Pacific; Global Investment Management, and Development Services. It offers services to occupiers, owners, lenders and investors in office, retail, industrial, multifamily and other types of commercial real estate. It offers commercial real estate services under the CBRE brand name, investment management services under the CBRE Global Investors brand name and development services under the Trammell Crow Company brand name. It is focused on several competencies, including commercial property, corporate facilities, project and transaction management, tenant/occupier and property/agency leasing, capital markets solutions, real estate investment management, valuation, development services and proprietary research."

Stock Pick Performance From Value Investing Congress Speakers Presenting at September's Event

The Value Investing Congress is only a few weeks away and will take place on September 16th & 17th in New York.  MarketFolly readers can receive discounted admission by clicking here and using code: N13MF7  This code expires tonight so be sure to take advantage.


Performance of Last Year's Picks From Speakers

We thought we'd check in on the performance of the stock picks from last year's Value Investing Congress.  These picks are from speakers who presented last year that will also be presenting again this year.

Here's the performance breakdown from October 3rd, 2012 until August 29th, 2013:

- 17 out of 21 picks outperformed the S&P 500

- Average performance of picks: +49%

- Performance of S&P 500 over same time frame: +13.3%


Jeff Ubben's Picks
Long Valeant Pharmaceuticals (VRX) +77.1%
Long Moody's (MCO): +44.2%
Long CBRE (CBG): +14.3%
Long Motorola Solutions (MSI): +11.7%

He also mentioned these names: Halliburton (HAL): +42.5%, Adobe (ADBE) +41%, & C.R. Bard (BCR): +9.8%


Mick McGuire's Picks
Long Gencorp (GY): +50.5% 
Long Brookfield Residential Properties (BRP): +39.6%

Long Alexander & Baldwin (ALEX): +28.7%


Alex Roepers' Picks
Long Rockwood Holdings (ROC): +34.9%
Long Energizer (ENR): +34%
Long Clariant (CLN VX): +33.9%
Long FLSmidth (FLS DC): -5.7%
Long Joy Global (JOY): -45.1%


Whitney Tilson's Picks
Long Netflix (NFLX): +409.8%
Long Howard Hughes (HHC): +46%
Long Berkshire Hathaway (BRK.A): +26.1%


Guy Gottfried's Picks
Long Canam Group (TSE:CAM): +81.2%
Long ClubLink Enterprises (TSE:CLK): +19.1%


Bob Robotti's Picks
Long Calfrac Well Services (TSE:CFW): +34.8%


As you can see, these managers' picks performed quite well on average.  And don't forget: each one of them will be presenting their new picks at this year's event in a few weeks along with plenty of other new speakers (full list of speakers here).


Hear Ubben, McGuire, Roepers & More Pitch Their Latest Ideas

Find out what stock picks these hedge fund managers will pitch at this year's Value Investing Congress in September.  Market Folly readers can save $800 off admission by registering here and using code: N13MF7  Remember, the code expires tonight!

Jeff Ubben's Presentation on Moody's & CBRE Group: Invest For Kids Chicago

Next up in our notes from Invest For Kids Chicago is Jeff Ubben of ValueAct Capital.  He presented two ideas: Moody's (MCO) and CBRE Group (CBG).

•    Describes firm’s style as “strategic block investing” 
•    Expert is someone who has made & learned from many mistakes 
•    ValueAct looks for 12 companies that can flourish 
•    Join a board about half the time usually a couple years into the investment 
•    Motorola Solutions (MSI) = top holding 
•    ValueAct looks for companies with small cost of customers product but are valuable inputs 
•    Don't like traditional financials as its hard to analyze banks 
 

Ubben on Moody's

•   Moody's: Investment is in the 5th inning  and is a 9% position for ValueAct (they run a concentrated portfolio) 
•    Maintenance fees are 60% of revenue and is very critical 
•    Moody’s rating are a de minims cost of debt 
•    Transaction revenues provide huge growth potential 
•    European growth in credit markets as banks fall away as source of funds is highly probable 


Ubben on CBRE Group

•    CBRE Group (CBG): Investment is in the 2nd  inning 
•    Scale & cross sales 
•    Real estate is the last bastion of outsourcing as companies have already done HR etc. 
•    CBRE essentially now a partner to companies instead of a broker 
•    Scrapping bottom of property sales 
•    "Ridiculously cheap cyclical" with tons of transaction volume coming (2/3rds of commercial wave expected to trade hands with 1/3rd refinancing) 

Jeff Ubben also pitched MCO & CBG and other stocks at the Value Investing Congress if you want more color.


For the rest of the hedge fund presentations from the event, check out our notes from Invest For Kids Chicago.

Jeff Ubben's Favorite Investment Ideas: Value Investing Congress

Continuing coverage, we're posting up notes from the Value Investing Congress.  Below are notes and the presentation of Jeff Ubben of ValueAct Capital, which manages around $8.5 billion.  His presentation was entitled 'Avoiding Complexity and VAC Circle of Life.'

Ubben's Stock Ideas

CB Richard Ellis (CBG):  Dominant market share, 50% recurring revenue, does real estate leasing.  Ubben pointed out that outsourcing is in the first innings and that the company is one of only 2 that can scale it.

Moody's (MCO):  He doesn't like traditional financials, hard to value assets, or retailers.  Yet he likes MCO.  Says high moat and limited competition, pricing power.  55% recurring revenue and a big M&A cycle coming.  Then he showed slides from the company's pitch book (Einhorn disparaged MCO earlier in the day).  Ubben said MCO is "schmuck insurance" and at the end of the day their ratings are a currency.  We previously detailed when Ubben went activist on MCO back in 2011.

Valiant Pharmaceuticals (VRX):  A branded generics play.  We recently posted up why Ruane Cunniff & Weitz Funds like VRX.

Motorola Solutions (MSI):  This is his biggest position.  He says the big thing here is to drive the payout ratio.  It's going slow and steady but he thinks there's an opportunity for them to actively help the company. 


Other stocks he mentioned:

Adobe (ADBE)

CR Bard (BCR)

Sara Lee

Halliburton (HAL)



Learning From His Mistakes:

1. Valuation.  Just math, require 10% per year.
2. Leverage.  Make sure it's appropriate for the cyclicality of the business.
3. Bad Governance.  Don't go looking for a problem to fix.
4. Complexity.  Need easily identifiable drivers.  Simpler, the better.

For more from this hedge fund manager, we've posted up Ubben on activist value investing.


Embedded below is Ubben's slideshow presentation from the Value Investing Congress: 





Check out the rest of the hedge fund presentations from the Value Investing Congress.