"Tracking Bruce Berkowitz’s Fairholme Portfolio – Q2 2021 Update"
"Bruce Berkowitz’s 13F stock portfolio value increased this quarter from $1.21B to $1.27B.Several small positions were dropped, and new ones added during the quarter.The 13F portfolio is mostly invested in St. Joe Companies.This article is part of a series that provides an ongoing analysis of the changes made to Fairholme’s 13F stock portfolio on a quarterly basis. It is based on Fairholme’s regulatory  filed on 8/16/2021. Please visit our  article for an idea on how his holdings have progressed over the years and our  for the fund’s moves during Q1 2021.Berkowitz’s 13F stock portfolio value increased marginally from $1.21B to $1.27B this quarter. The 13F portfolio currently has most of the assets invested in St. Joe Companies.Berkowitz’s flagship Fairholme Fund (FAIRX) has generated significant alpha since its December 1999 inception: the fund returned at an annualized rate of 10.10% compared to 7.18% for S&P 500 index through Q2 2021. FAIRX has however underperformed over the most recent 10-year period. Of the ~$1.5B AUM, Cash and Equivalents are at ~23%, St. Joe stock at ~70%, Fannie/Freddie pfds at ~8%, and Imperial Metals at ~2%. The other funds under Fairholme umbrella are Fairholme Focused Income Fund (FOCIX) and Fairholme Allocation Fund (FAAFX). Equity holdings that are not in the 13F report include Fannie Mae (FNMA) pfds, Freddie Mac (FMCC) pfds, and Imperial Metals (IPMLF).New Stakes:Commercial Metals (CMC), Intel Corp (INTC), Alibaba Group Holdings (BABA), and Enterprise Product Partners (EPD): These are small (less than ~1.35% of the portfolio each) stakes established this quarter. EPD is back in the portfolio after a quarter’s gap.Stake Disposals:AT&T Inc. (T), CVS Health (CVS), TC Energy Corp (TRP), and Verizon Communications (VZ): These very small (less than ~1% of the portfolio each) stakes were disposed during the quarter. TC Energy and Verizon Communications were small new positions purchased last quarter.Stake Increases:Apple Inc. (AAPL) and Vistra Corp (VST): These two very small positions established last quarter were increased this quarter. Vistra stake is very small at 0.81% of the portfolio while  the Apple position is even smaller at 0.15%.Stake Decreases:Western Midstream Partners (WES): WES is a small stake first purchased in Q1 2020 at prices between ~$3 and ~$22. Q3 2020 saw a ~85% stake increase at prices between $7.35 and $10.50. The stock is now at $21.11 and the stake is at 0.82% of the portfolio. There was a ~13% trimming this quarter.Enbridge Inc. (ENB): The 1.12% ENB stake saw a marginal reduction this quarter.Kept Steady:St Joe Companies (JOE): ~91% of Fairholme’s 13F assets are in St. Joe stock. The bulk of the position was purchased in the 2008-2009 timeframe and there have only been minor adjustments since. Last three quarters of 2017 had seen a combined ~14% increase at prices between $16.35 and $19.55. The stock is now at $43.02.Note: Fairholme’s mid-year 2021 report referenced St. Joe CEO Jorge Gonzalez’s comment regarding the growth runway: “…only scratching the surface…for multi-generational growth”. The 2020 annual report mentioned the following as the reasons for Fairholme’s continued bullishness: robust pricing, strong sales, and the fact that their entitled lands in Walton, Bay, and Gulf Counties may be worth exponentially more than implied by the company’s market value.Berkshire Hathaway (BRK.A) (BRK.B): Q1 2019 saw a 5.6% of the portfolio stake purchased at prices between $188 and $209. The position was reduced by ~85% to a very small 0.84% portfolio stake next quarter at prices between $197 and $219. Q1 2020 saw a ~9% portfolio stake built at prices between ~$162 and ~$230. There was a one-third increase next quarter at prices between $170 and $202. Q4 2020 saw a ~80% selling at prices between ~$201 and ~$234. That was followed with a ~15% reduction last quarter at prices between ~$227 and ~$265. The stock currently trades at ~$277 and the stake is now very small at 1.13% of the portfolio.Kinder Morgan (KMI), and Energy Transfer LP (ET): These small (less than ~1% of the portfolio each) stakes established in Q3 2020 were increased over the next two quarters. The 0.96% KMI position saw a ~220% stake increase in Q4 2020 at prices between ~$11.50 and ~$15 and it currently trades above that range at $16.92. There was a ~5% stake increase last quarter. ET is a 0.86% of the portfolio position purchased at prices between ~$5 and ~$8.60 and it is now above that range at $9.58.Old Republic International (ORI) and Williams Companies (WMB): These very small (less than ~0.70% of the portfolio each) stakes were kept steady this quarter.The spreadsheet below highlights changes to Fairholme’s 13F stock holdings in Q2 2021:Source: John Vincent. Data constructed from Fairholme's 13F filings for Q1 2021 and Q2 2021.Regulatory filings from 3/15/2021 thru 6/22/2021: None."