"Tracking Yacktman Asset Management Portfolio – Q3 2015 Update"
"Yacktman's US long equity portfolio decreased ~19% from $18.74B to $15.24B this quarter.Yacktman Asset Management dropped eBay Inc. in the quarter. Most of their other positions were reduced as well.Yacktman’s largest five stakes are at ~50% of the US long portfolio.This article is part of a series that provides an ongoing analysis of the changes made to Donald Yacktman’s US stock portfolio on a quarterly basis. It is based on Yacktman Asset Management’s regulatory  filed on 11/09/2015. Please visit our  to get an idea of his investment philosophy and our  highlighting the fund’s moves during Q2 2015.This quarter, Yacktman Asset Management’s (YACKX) (YAFFX) (YASSX) US long portfolio decreased 18.70% from $18.74B to $15.24B. The number of holdings remained steady at 47. The largest holding is Procter & Gamble at 13.15% of the US long portfolio. Largest five individual stock positions are Procter & Gamble, Twenty First Century Fox, PepsiCo Inc., Sysco Corporation, and Coca-Cola and they together account for 50.25% of the US long portfolio. The firm has around $28B in Assets Under Management (AUM) and currently holds around 18% in cash - a far cry compared to zero cash immediately following the financial crisis. The portfolio is concentrated with recent 13F reports showing around 50 individual positions. 28 of their stakes are significantly large (over ~0.5% of the US long portfolio each) and they are the focus of this article.To add from Q4 2015 Update onwards: To know more about Yacktman's bottom-up value investing philosophy, check-out the book "".New Stakes:None.Stake Disposals:eBay Inc. (EBAY): A ~2% EBAY stake was purchased in Q4 2013 at prices between $21 and $23. Last quarter saw a ~22% reduction at prices between $23.48 and $26.61 and the elimination happened this quarter at prices between $24 and $29. The stock currently trades at $29.18.Note 1: The stock price reflects the spin-off of PayPal (PYPL) on July 17th. EBAY shareholders received one share of PYPL for each share of EBAY held.Note 2: The stock had a previous round-trip in the portfolio. A small long-term stake was eliminated in 2011.Stake Increases:Johnson & Johnson (JNJ): JNJ is a medium-sized 4.63% of the US long portfolio position that has been in the portfolio since their first 13F filing in Q1 1999. The bulk of the current position was purchased in 2011 in the low $60s price-range. The stock currently trades at around $101. Last quarter saw a ~12% reduction at prices between $97 and $104 and this quarter saw a marginal increase.Twenty First Century Fox (FOX) (FOXA): Yacktman had a very small position in News Corporation (NWS) in 2008. The 2009 to 2012 timeframe saw a huge stake build up as his share count increased 32-times (2.5M shares to over 80M shares). Since the spinoff and renaming of News Corporation, both positions (News Corp and Twenty First Century Fox) had seen selling - the NWS stake was eliminated in Q4 2013 and the FOXA stake was reduced by around 28%. Last four quarters had seen only very minor adjustments. This quarter saw a ~10% increase at prices between $25.19 and $34.49. Yacktman’s average cost-basis on this position is very low. The remaining stake is huge at ~12.93% (second-largest) of the US long portfolio.Stake Decreases:C.R. Bard Inc. (BCR): BCR is a 1.79% of the US long portfolio position. Last year had seen a ~42% reduction at prices between $129 and $172. The selling accelerated in the last three quarters: two-thirds further reduction at prices between $163 and $201. The stock currently trades at $185. The original position consisted of ~2.14M shares purchased in 2010 at prices between $76 and $96. The stake was built up to just over 7.4M shares by 2012 and since then has seen selling. Yacktman is harvesting huge gains. They still control ~2% of the business.Cisco Systems (CSCO): CSCO is a large 6.22% of the US long portfolio position first purchased in 2010. The bulk of the current position was purchased in 2011 and 2012 at prices between $15 and $22. The stock currently trades at $28.18. This year has so far seen a combined ~37% reduction at prices between $24.62 and $30.19. The position has seen consistent selling since Q1 2014. Yacktman is harvesting gains from this position.Clorox Company (CLX): CLX is a very long-term 0.51% portfolio position that has been in the portfolio since Yacktman’s first 13F filing in Q1 1999. The bulk of the current position was purchased in 2012 when almost 4M shares were acquired at prices between $67 and $76. Q3 2014 saw a ~17% stake reduction at prices between $86 and $97 and that was followed with another roughly one-third reduction the following quarter at prices between $95 and $106. The selling accelerated this year: almost 80% further reduction at prices between $103 and $119. The stock currently trades at $122. The significant selling in a very long-term position indicates a clear bearish bias.Coca-Cola Company (KO) & PepsiCo Inc. (PEP): KO & PEP are very long-term positions that have been in the portfolio for over fifteen years. During Yacktman’s first 13F filing in Q1 1999, the positions consisted of just a few thousand shares each. The KO stake was built up to almost 2.4M shares by Q4 2006. The position size dropped below 1.5M shares in Q4 2008 but since then the stake was consistently increased - the position doubled in both 2009 & 2010 and increased by ~150% each in 2012 & 2013. The huge stake build-up happened at prices between $21 & $30 and $33.50 & $43 in the 2009-10 & 2012-13 periods respectively. The stock currently trades at $41.54 and the position stands at 6.55% of the US long portfolio. The even larger 11.01% PEP stake was similarly built-up over multiple years with the bulk of the buying happening in the 2011-13 timeframe: over 22M shares were purchased during that time at prices between $60 and $86. The stock currently trades at $98.88. Last two quarters have seen significant reductions in both: KO was sold down by ~36% at prices between $37.99 and $42.12 while PEP saw a ~30% reduction at prices between $89.64 and $99.86.Oracle Corporation (ORCL): The fairly large 6.25% ORCL position was first purchased in Q2 2013. Over 20M shares were purchased at prices between $30 and $35. Q1 2015 saw a ~8% reduction at prices between $41.47 and $45 and that was followed with a ~14% reduction last quarter at prices between $40.30 and $44.91. The pattern continued this quarter with a ~12% reduction at prices between $35.44 and $40.96. The stock currently trades at $40.10.Stryker Corporation (SYK): SYK is a 1.94% of the US long portfolio position first purchased in 2009. The majority of the current stake was established in 2012 at prices between $50 and $57. The position had since been kept relatively steady. Q4 2014 saw a ~24% reduction at prices between $79.20 and $96.61. The pattern continued the following quarter with a ~13% reduction at prices between $90 and $96 and that was followed with another ~23% selling last quarter at prices between $91.12 and $97.40. This quarter saw a further ~36% reduction at prices between $92 and $105. The stock currently trades at $96.81. Yacktman is aggressively harvesting huge long-term gains from this position.Sigma-Aldrich Corporation (SIAL): The SIAL stake was established in Q1 2013 when around 1.25M shares were purchased. The position was doubled the following quarter. The buying happened at prices between $75 and $85. Since then, the position remained relatively steady although minor adjustments were made every quarter. Q3 2014 saw a ~25% reduction at prices between $100 and $136 and the following quarter saw another ~13% reduction at prices between $134 and $138. This quarter, the remaining ~1% stake was almost sold out. The stock currently trades very close to $140.Note: The stock had a ~30% price-spike on September 22, 2014 when it was announced that Merck Inc. (MRK) had agreed to acquire SIAL for $140 per share in cash.Sysco Corporation (SYY): SYY is a fairly large position at 6.60% of the US long portfolio. It was established in 2010 with the bulk purchased in 2011 and 2012 in the high-20s price-range. The position has wavered. Last quarter saw a ~8% increase at prices between $36 and $40 while this quarter saw a ~24% reduction at prices between $35.68 and $41.38. The stock currently trades at $40.47.Note: In June 2015, a federal judge ruled against Sysco’s plans to merge with US Foods and the deal was abandoned soon after.Anthem Inc. (ANTM) previously Wellpoint Inc.: ANTM is a ~1% of the US long portfolio position purchased in 2012 at prices between $55 and $74. Since then, the position had seen minor trimming every quarter. Q1 2015 saw a ~15% reduction at prices between $123 and $158 and that was followed with a huge ~58% reduction last quarter at prices between $151 and $171. This quarter saw a marginal further reduction. The stock currently trades at around $134. Yacktman has a large exposure to the healthcare industry, a group that also includes Johnson & Johnson, C.R. Bard, Sigma-Aldrich, and Stryker Corporation. Last five quarters have seen stake reductions in all of them and that indicates a shift in bias.Avon Products (AVP): AVP is a 0.81% of the US long portfolio position. The original stake was a 15M share position established in 2011 at prices between $16 and $29. The stake was increased to 18.9M shares by the end of 2012 at prices between $14 and $23. Last year saw a two-thirds increase at prices between $9 and $17. Last two quarters had seen a further ~22% increase at prices between $6.26 and $9.39. This quarter saw a marginal reduction. The stake is now at 38.01M shares (8.8% of the business). The stock currently trades well below the low end of his purchase price ranges at $3.05. For investors attempting to follow Yacktman, AVP is a good option to consider for further research.C.H. Robinson Worldwide Inc. (CHRW): CHRW was an insignificantly small position (~700K shares) purchased in 2012. During Q1 & Q2 2013, ~5.4M additional shares were purchased at prices between $54 and $67 and since then the stake had been kept relatively steady. Q4 2014 saw a ~8% reduction at prices between $63.45 and $77.16 and last quarter saw a further ~6% selling at prices between $61.64 and $73.22. This quarter also saw a ~9% reduction at prices between $61.89 and $70.83. The stock currently trades at $67.82 and the position stands at 2.22% of the US long portfolio.Comcast Corporation (CMCSA): CMCSA is a ~1% of the US long portfolio position first purchased in 2008. The bulk of the current position was purchased in 2009 in the $15 price-range. Q3 2014 saw a ~27% reduction at prices between $53 and $57 and the following quarter saw another ~15% reduction at prices between $53.15 and $60.57. Last quarter the pattern continued: ~39% sold at prices between $56.28 and $61.27. There was a minor reduction this quarter as well. The stock currently trades at $61.35. Yacktman is harvesting large long-term gains from this position.Exxon Mobil (XOM): XOM is a 2.88% of the US long portfolio stake first purchased in 2007. The bulk of the position was acquired in 2013 in the low-90s price-range. The stock currently trades at $81.96. Last quarter saw a ~13% reduction at prices between $82.82 and $89.11. This quarter also saw a marginal reduction.Microsoft Corporation (MSFT): MSFT has been in the portfolio since 2003 and it became a significantly large position in 2006 when around 2.2M shares were purchased at prices between $22 and $29.50. The bulk of the current 4.97% of the US long portfolio stake was established in 2011 when ~20M shares were added at prices between $24 and $28.50. Q3 2014 saw a 14.29% reduction at prices between $41.50 and $45.50 and that was followed with a ~22% reduction the following quarter at prices between $42.74 and $49.61. Last quarter saw a further ~16% reduction at prices between $40.29 and $49.15. This quarter also saw minor selling. The stock currently trades at $54.16. Yacktman is harvesting long-term gains from this position.Procter & Gamble (PG): PG is a very long-term position that has been in the portfolio since Yacktman’s first 13F filing in 1999. The position size remained insignificantly small until 2007 when about 520K shares were purchased at prices between $61 and $74. The position was cut in half in 2008 but the following four-years saw a 100-fold stake increase at prices between $47 and $70. Q2 2014 saw a 6% increase at prices between $78.50 and $83. Last five quarters have seen only marginal activity. The stock currently trades at $75.40.  PG is Yacktman’s largest position at 13.15 % of the portfolio.State Street Corporation (STT): STT is a small 0.86% of the US long portfolio position that saw a ~10% reduction last quarter at prices between $73.45 and $80.84. This quarter also saw minor selling. The stock currently trades at $72.42. The original stake is from 2010 with the bulk purchased in 2011 in the high-30s price-range.US Bancorp (USB): The 2.39% USB position has been in the portfolio for over 15 years. Majority of the current stake was purchased in 2011 in the low-20s price-range. The stock has doubled and currently trades at $43.34. Last quarter saw a ~19% reduction at prices between $42.44 and $45.10 and this quarter saw a further ~8% reduction at prices between $39.76 and $46.Unilever N V (UN): UN is a small ~1% of the US long portfolio stake established in Q4 2014 at prices between $37.14 and $41.02. In Q1 2015, the position was increased by ~23% at prices between $37.64 and $43.88. Last two quarters have seen marginal reductions. The stock currently trades at $43.87.Wal-Mart Stores (WMT): WMT is a long-term position that was first purchased in 2004. The bulk of the current position was purchased in 2011 when around 2M shares were acquired at prices between $50 and $60. The stock currently trades at $58.51. Q1 2015 saw a ~4% trimming at prices between $80.69 and $90.47 and last quarter the selling accelerated: around one-third reduction at prices between $70.93 and $82.25. This quarter saw a further ~7% trimming at prices between $63.10 and $73.79. The position now accounts for 0.82% of the US long portfolio.Wells Fargo (WFC): WFC is a small 0.79% of the US long portfolio position first purchased in Q1 2013. The bulk of the current position was purchased in Q2 2013 when ~4.8M shares were acquired at prices between $36.50 and $44.50. The position was kept relatively steady until Q1 2014. Q2 & Q3 2014 saw significant selling as the stake was reduced to 2.8M shares at prices between $48 and $54. The stock currently trades at $55.49. This year has so far seen a further ~18% reduction at prices between $50 and $58.52.The Bank of New York Mellon Corporation (BK), Colgate-Palmolive (CL), ConocoPhillips (COP), Hewlett Packard (HPQ), and Viacom Inc. (VIAB): These are significant positions (more than ~0.5% of the US long portfolio) that were decreased marginally (less than ~10% change in position size) this quarter. As the activities were very minor, they do not indicate a clear change in bias.Kept Steady:None.Yacktman is known to shy away from investing in banks but has held significant stakes in three banks since the financial crisis. Last three quarters have seen selling in all of them: The Bank of New York Mellon (1.69%), US Bancorp (2.39%), and Wells Fargo (0.79%).Very small (less than 0.5% of the portfolio each) positions account for 2.37% of the overall portfolio. They are Altria Group (MO), America’s Car-Mart (CRMT), Apollo Education Group (APOL), The Bancorp Inc. (TBBK), Bank of America (BAC), Berkshire Hathaway (BRK.A)(BRK.B), Corning Inc. (GLW), Goldman Sachs (GS), Intel Corporation (INTC), Lancaster Colony (LANC), Liberty Media (LMCA), MOCON Inc. (MOCO), Preformed Line Products (PLPC), PayPal (PYPL), Philip Morris Intl. (PM), Raven Inds. (RAVN), Staples Inc. (SPLS), and Valmont Industries (VMI). Yacktman controls ~2% of APOL. Martha Stewart Living Omnimedia (MSO) was eliminated this quarter.The spreadsheet below highlights changes to Yacktman’s US stock holdings in Q3 2015:Latest 13G/13D filings (02/2015): APOL (2.2M shares - 2%), AVP (31.47M shares - 7.2%), SYY (31.63M shares - 5.3%), BCR (4.46M shares - 5.9%)"