"Tracking Ruane, Cunniff, & Goldfarb’s Portfolio – Q4 2022 Update"
"Ruane, Cunniff, & Goldfarb’s 13F portfolio value decreased from $6.73B to $6.40B this quarter. The number of positions increased from 31 to 32.They dropped Wayfair and decreased UnitedHealth, Elevance Health, and Netflix.The top three positions are Charles Schwab, Intercontinental Exchange, and UnitedHealth, and they add up to ~30% of the portfolio.This article is part of a series that provides an ongoing analysis of the changes made to Ruane, Cunniff & Goldfarb’s 13F portfolio on a quarterly basis. It is based on their regulatory  filed on 2/13/2023. Please visit our  article for an idea on their investment philosophy and our  for the moves during Q3 2022.This quarter Ruane, Cunniff, & Goldfarb’s 13F portfolio value decreased ~5% from $6.73B to $6.40B. The number of holdings increased from 31 to 32. 16 of those stakes are significantly large (more than ~0.5% of the portfolio each) and they are the focus of this article. The top three positions are at ~30% while the top five are at ~47% of the 13F assets: Charles Schwab, Intercontinental Exchange, UnitedHealth, Formula One, and Alphabet.The firm is best known as the investment advisor of the Sequoia Fund (SEQUX) which has a venerable ~53-year track record (July 15, 1970 inception, 12.92% annualized return compared to 10.85% for the S&P 500 index). The performance for 2022 was terrible: Negative 30.52% compared to Negative 18.11% for the S&P 500 index. After new management took over in Q1 2016, the portfolio has seen a significant shift to information & services businesses from asset-intensive manufacturing & retail. Also, the cash allocation which had averaged ~20% since inception is now close to zero. The following significant stakes in Sequoia’s portfolio are not in the 13F report as they are not 13F securities: Constellation Software (CNSWF), Eurofins Scientific SE (ERFSF), Rolls-Royce Holdings plc (RYCEY), SAP SE (SAP), and Universal Music Group (UMGNF). Bill Ruane was a Benjamin Graham pupil. To learn about Benjamin Graham's teachings, check out the classics  and .Stake Disposals:Wayfair Inc. (W): W was a 2.27% of the 13F portfolio stake purchased in Q3 2019 at prices between $106 and $152. Next quarter saw a ~40% stake increase at prices between $80 and $118. That was followed with another ~30% increase in Q1 2020 at prices between ~$24 and ~$110. The four quarters through Q1 2021 saw a ~75% reduction at prices between ~$47 and ~$346. Q3 2021 saw a ~80% stake increase at prices between ~$239 and ~$317. That was followed with a one-third increase next quarter at prices between ~$190 and ~$280. Q2 2022 saw another ~45% stake increase at prices between ~$44 and ~$117. The disposal this quarter was at prices between ~$28 and ~$42. The stock currently trades at $49.81.Stake Decreases:Charles Schwab (SCHW): SCHW is now the largest 13F position at 10.98% of the portfolio. It was first purchased in Q2 2016 at a cost-basis of ~$29. Q1 2020 saw a ~40% stake increase at prices between $28.50 and $49. There was a ~17% selling next quarter at prices between $32.50 and $43. The stock is now at ~$80. Last few quarters have seen minor trimming.Intercontinental Exchange (ICE): The large (top three) ~10% ICE stake was purchased in Q3 2020 at prices between ~$92 and ~$107. There was a ~90% stake increase in Q2 2022 at prices between ~$90 and ~$133. The stock currently trades at ~$104. Last two quarters have seen a ~5% trimming.UnitedHealth (UNH): UNH is a large (top three) 9.36% of the portfolio stake. It was established in Q4 2019 at prices between $215 and $296 and increased by ~300% next quarter at prices between ~$195 and ~$305. Q3 2020 saw a ~30% stake increase at prices between ~$291 and ~$324. There was a ~25% selling in Q2 2022 at prices between ~$452 and ~$546. That was followed with a ~15% reduction this quarter at prices between ~$499 and ~$555. The stock currently trades at ~$489.Formula One Group (FWONA) (FWONK): Sequoia’s Q4 2016 letter disclosed a new stake in Liberty Media Formula One. They participated in Liberty’s acquisition of Formula One and acquired the shares at a discounted price of $25. There was a 24% stake increase in Q2 2017 at prices between $30.50 and $37. The six quarters thru Q3 2019 had seen a ~18% selling at prices between $28.50 and $43 and that was followed with similar selling next quarter at prices between $40 and $46. Last three years have seen only minor adjustments. FWONA is currently at ~$63. The stake is now a large position at ~9% of the portfolio.Note: their ownership stake in Formula One Group is ~4.7%.Alphabet Inc. (GOOG) (GOOGL): GOOG is now at 7.92% of the portfolio. It was first purchased in 2008 and that original stake was almost sold out the following year. In 2010, a much larger position was built in the low-teens price-range. Recent activity follows: Q2 2019 saw a one-third reduction at prices between ~$52 and ~$64. That was followed with a ~60% reduction over the six quarters through Q4 2020 at prices between ~$53 and ~$107. Last three quarters saw a  ~27% reduction at prices between ~$83 and ~$144. The stock currently trades at ~$92.Micron Technology (MU) and Elevance Health (ELV): MU is a 3.72% of the portfolio position built over the two quarters through Q3 2021 at prices between ~$74 and ~$96 and the stock currently trades well below that range at ~$57. Last quarter saw a one-third reduction at prices between ~$49 and ~$65. That was followed with a ~3% trimming this quarter. The 6.62% ELV stake was established in H1 2021 at prices between ~$288 and ~$402 and it is now at ~$484. Q2 2022 saw a ~42% reduction at prices between ~$444 and ~$530. That was followed with a ~16% selling this quarter at prices between ~$454 and ~$547.CarMax Inc. (KMX): KMX is currently at ~6% of the 13F portfolio. It was purchased in Q2 2016 at prices between $46 and $56 and increased by ~70% in Q4 2016 at prices between $48.50 and $66. Q4 2017 saw a ~30% selling at prices between $64 and $77 while next quarter there was a ~80% increase at prices between $59 and $72. The eleven quarters through Q4 2020 had seen a ~45% selling at prices between ~$44 and ~$109. The stock is now at $69.49. Last several quarters have also seen minor trimming.Credit Acceptance Corp. (CACC): CACC is a 5.92% stake established in Q1 2017 at prices between $185 and $221. There was a ~25% stake increase in Q4 2020 at prices between $288 and $356. Q3 2021 saw a ~18% selling at prices between ~$438 and ~$670. That was followed with a one-third reduction next quarter at prices between ~$582 and ~$696. The stock is now at ~$456. Last four quarters also saw minor trimming.Note: They have a ~6.2% ownership stake in Credit Acceptance Corp.Meta Platforms (META): The 5.57% META position saw a whopping ~600% stake increase in Q1 2018 at prices between $152 and $193. The next two quarters had seen another ~27% increase at prices between $155 and $218. Q1 2019 saw an about turn: ~23% reduction at prices between $124 and $173. Q1 2021 saw a ~13% stake increase at prices between ~$246 and ~$299. Last quarter also saw a ~11% stake increase. The stock currently trades at ~$171. There was a ~3% trimming this quarter.Taiwan Semi (TSM): The 5.24% of the portfolio TSM stake was purchased in Q4 2019 at prices between $46.50 and $59. There was a ~130% stake increase in Q2 2020 at around the same price range. Q1 2021 saw a ~12% selling while in Q3 2021 there was a ~20% stake increase. Last quarter saw a ~30% selling at prices between ~$69 and ~$92. The stock currently trades at ~$87. There was a minor ~3% trimming this quarter.Note: their investment thesis is based on the following: fabs are capital intensive (~$10B per facility) and the leader naturally has a strong moat thereby yielding big profit margins. Debatably, they produce the most important manufactured component in the modern economy. It is essentially a monopoly, and the main concern is geopolitical risks.Jacobs Solutions (J) previously Jacobs Engineering: J is a ~5% long-term stake first purchased in 2012. Recent activity follows: Q2 2018 saw a ~20% increase at prices between $56.50 and $67 while the next six quarters saw minor trimming. There was a ~25% selling in Q1 2020 at prices between ~$63 and ~$104. That was followed with a similar reduction in Q2 2021 at prices between ~$129 and ~$143. The stock currently trades at ~$120. Last six quarters also saw minor trimming.Capital One Financial (COF): COF is a ~4% of the portfolio position established last quarter at prices between ~$91 and ~$116 and the stock currently trades at ~$109. There was a minor ~3% trimming this quarter.Berkshire Hathaway (BRK.A) (BRK.B): Berkshire stake is now at 3.84% of the portfolio. It is a very long-term position that was the largest stake in their first 13F filing in 1999. Recent activity follows:  Q1 2018 saw a one-third selling at prices between ~$191 and ~$217. The nine quarters through Q1 2022 had seen the large stake sold down at prices between ~$169 and ~$359. Next quarter saw another one-third selling at prices between ~$268 and ~$353. The stock is now at ~$303. Last two quarters also saw minor trimming.Liberty Broadband (LBRDK): LBRDK is a 3.77% of the portfolio position purchased in Q1 2018 at prices between $86 and $97 and increased by ~20% next quarter at prices between $69 and $85. Q1 2020 saw a ~18% reduction at prices between ~$91 and ~$139. There was a ~23% stake increase in Q1 2021 at prices between ~$143 and ~$157. The stock currently trades at ~$90. Last seven quarters saw minor trimming.Netflix Inc. (NFLX): NFLX is a 2.90% of the portfolio position purchased in Q4 2020 at prices between ~$471 and ~$554. There was a ~15% stake increase in Q2 2021 at prices between ~$485 and ~$555. That was followed with a ~85% stake increase in Q1 2022 at prices between ~$331 and ~$597. Next quarter also saw another ~45% stake increase at prices between ~$166 and ~$392. Last quarter saw an about turn: ~40% selling at prices between ~$174 and ~$249. That was followed with another ~50% reduction this quarter at prices between ~$214 and ~$320. The stock currently trades at ~$335.The spreadsheet below highlights changes to Ruane, Cunniff, & Goldfarb’s 13F stock holdings in Q4 2022:Source: John Vincent. Data constructed from Ruane, Cunniff, & Goldfarb's 13F filings for Q3 2022 and Q4 2022.Q3 2022 Portfolio Review video, Letter, Factsheet: Performance: Negative 36.14% vs negative 23.87% for the S&P 500 index YTD through Q3 2022. 12.80% vs 10.75% since 1970 inception. Increased: Eurofins, Meta, and Universal Music Group . Trimmed: Alphabet, Elevance, Micron, Netflix, and TSMC. NEW: COF. Commentary: Nothing much.Note:  is an affiliated but separate business that invests in early stage. They also have a long-term structure whereby they hold public businesses as well once their portfolio companies do a successful IPO – DASH, U, etc. are examples. Related article from 6/2022 -Regulatory filings from 9/3/2022 to 11/29/2022: None."