"Tracking Charles Akre's Akre Capital Management Portfolio – Q3 2019 Update"
"Chuck Akre’s portfolio value increased from $9.86B to $10.14B this quarter.Akre Capital Management dropped TD Ameritrade & Ubiquiti while adding Brookfield Asset Management.The top three positions are American Tower, MasterCard, and Moody’s, and they add up to ~41% of the entire portfolio.This article is part of a series that provides an ongoing analysis of the changes made to Akre Capital Management’s 13F portfolio on a quarterly basis. It is based on Akre’s regulatory  filed on 11/13/2019. Please visit our  series to get an idea of their investment philosophy and our  for their moves in Q2 2019.This quarter, Akre’s 13F portfolio value increased ~3% from $9.86B to $10.14B. The number of positions stayed steady at 25. The largest five stakes are American Tower, MasterCard, Moody’s Corporation, Visa, and O’Reilly Auto. They account for ~57% of the total portfolio value.AUM is distributed among private funds, separately managed accounts, and the Akre Focus Mutual Fund (AKREX) (AKRIX) (AKRSX). Since the 2009 inception, the mutual fund’s annualized returns are at 16.78% compared 13.54% for the S&P 500 Index. Akre coined the term "compounding machines" to describe the type of businesses he invests in. To learn more about that investing style, check out .New Stakes:Brookfield Asset Management (BAM): BAM is a 2.79% of the portfolio stake established this quarter at prices between $48 and $54 and the stock currently trades at $57.24. For investors attempting to follow, BAM is a good option to consider for further research.Ollie’s Bargain (OLLI), Descartes Systems (DSGX), and Colony Capital (CLNY): These are minutely small (less than ~0.05% of the portfolio each) stakes established this quarter.Stake Disposals:Ubiquiti Inc. (UI): UI was a 2.82% portfolio stake built in H2 2014 at prices between $28 and $46.50. Q1 2015 also saw a ~40% stake increase at prices between $26 and $32. Since then, the position had been kept relatively steady. Last quarter saw a ~20% selling at prices between $120 and $171. The disposal this quarter was at prices between $108 and $136. The stock currently goes for ~$184.TD Ameritrade (AMTD): AMTD was a 1.70% portfolio position first purchased in 2009. The bulk of the stake was built in 2011 & 2012 at prices between $15 and $22 and the stock is now at $39.60. Q4 2018 saw a ~13% stake increase. The position was eliminated this quarter at prices between $35 and $53.Diamond Hill Investment Group (DHIL): The minutely small 0.08% portfolio stake in DHIL was disposed during the quarter.Stake Increases:CarMax Inc. (KMX): The 5.45% KMX stake is a very long-term position first purchased in 2002. The bulk of the current stake was built over the four quarters thru Q2 2016 at prices between $42 and $68. There was a ~10% stake increase in Q4 2018 at prices between $57 and $74 and that was followed with a ~5% increase next quarter. The stock is now at ~$96. This quarter also saw a ~3% stake increase.Verisk Analytics (VRSK): VRSK is a ~4% portfolio position first purchased in H2 2012 at prices between $46.50 and $51. 2015 saw a huge 3x stake increase at prices between $63 and $81. The position has since been kept relatively steady. The stock is currently at ~$140. There was a marginal increase this quarter.KKR & Company (KKR): KKR is a 3.38% of the portfolio position established in Q1 2018 at prices between $20 and $24.50 and doubled next quarter at prices between $19.50 and $25.50. There was another ~25% increase in Q4 2018 at prices between $18.50 and $28. The stock currently trades at $29.40.Note: KKR converted from a partnership to a corporation effective July 1, 2018.AlarmCom Holding (ALRM): ALRM is a small 0.63% first purchased in Q2 2015. This quarter saw a ~130% stake increase at prices between $46 and $53. The stock currently trades at $44.78. For investors attempting to follow, ALRM is a good option to consider for further research.Berkshire Hathaway (BRK.A) (BRK.B): Berkshire Hathaway is a 0.72% of the portfolio long-term stake. The last major activity was in Q3 2017 when there was a ~27% selling at prices between $169 and $184. The stock is now at ~$220. This quarter saw a marginal increase.Primo Water (PRMW): The very small 0.37% portfolio stake in PRMW saw a marginal increase this quarter.Note: Akre Capital Management has a ~7.4% ownership stake in Primo Water.Stake Decreases:American Tower (AMT): AMT has been in the portfolio for well over sixteen years. It is the largest stake at ~16% of the portfolio. Recent activity follow: the six years thru Q3 2018 saw consistent buying almost every quarter. The share count increased over four times from 1.7M shares to 7.1M shares during that period. The buying happened at prices between $65 and $118 and the stock is now at ~$210. Last few quarters have seen only marginal activity.Note: Akre is very bullish on AMT – growth in wireless communication depends on them and incremental margins are at over 90%. Crown Castle (CCI) is another option in the same mold.MasterCard (MA): MA is currently the second-largest 13F stake at 14.26% of the portfolio. It was first purchased in 2010 and consistently increased since. Their overall cost-basis is ~$22 compared to the current price of ~$278 per share.Note: In a WealthTrack interview earlier this month, Akre commented that something extraordinary is happening at MasterCard – if the rate of return is cut down twice, they would still be earning above average. On the question “one investment every investor should own some of”, Akre responded with two: MasterCard and Visa.Moody’s Corporation (MCO): The initial purchase of MCO happened in Q1 & Q2 2012 in the high-30s price-range. Since then, the position size was doubled at higher prices. Recent activity follow: Q4 2016 saw a ~15% increase at prices between $94 and $109 and that was followed with a ~22% increase the following quarter at prices between $95 and $114. It currently trades at $219 and is now the third-largest stake at 11.47% of the portfolio. There was marginal trimming in the last two quarters.Note: Akre’s cost-basis on MCO is ~$39.O’Reilly Automotive (ORLY): ORLY is a top five 7.41% portfolio stake first purchased in 2005. Over 800K shares were purchased at the time. The position was at 825K shares as of Q1 2017 - every year had seen adjustments but overall the stake had remained remarkably steady over that twelve-year period – the stock returned ~10x during that time. 2017 saw a ~130% stake increase at prices between $173 and $270. There has only been marginal activity since. The stock is now at ~$442.Note: In A WSJ interview in early 2018, Akre disclosed that the large increases in 2017 happened at an overall cost-basis of ~$195 per share.Markel Corporation (MKL): MKL is another large ~6% portfolio stake that has been in the portfolio for over twenty years. Recent activity follow: H2 2013 and H1 2014 saw a stake doubling at prices between $510 and $655 and since then the position has remained relatively steady. The stock is now at ~$1135. Last few quarters have seen only very minor activity.Note: Akre saw 20-times compounding over 20 years on his first purchases of MKL. However, they also increased their original stake substantially eleven years ago at a cost-basis of $444 (2.5 times book value) and that portion has only increased ~150%. Markel currently trades at around ~1.5 times book value.Dollar Tree (DLTR): DLTR is a 5.72% of the portfolio position first purchased in 2010 at a cost-basis in the low-20s. The stock currently trades at ~$108. Recent activity follow: there was a ~15% stake increase in Q2 2017 at prices between $66.50 and $83. Since then, there has only been minor adjustments.Roper Technologies (ROP): ROP is a large 5.51% of the portfolio position first purchased in Q2 & Q3 2014 at prices between $129 and $150. The stake saw incremental buying in the following quarters. In Q2 2016, there was a ~20% increase at prices between $165 and $185. The stock is now at ~$349. Last few quarters have seen only marginal activity.Enstar Group (ESGR): ESGR stake was almost eliminated during the quarter. The bulk of the original stake was from Q1 & Q2 2008 at prices between $89 and $119. The position remained largely untouched until 2015. H2 2015 & Q1 2016 saw a roughly 3x increase at prices between $146 and $165. Last year saw a ~38% selling at prices between $155 and $220 and the position was almost sold out over the last three quarters at prices between $160 and $192. The stock is currently at ~$204.Boston Omaha (BOMN): The minutely small (less than ~0.50% of the portfolio each) position in BOMN was almost eliminated during the quarter.Kept Steady:Visa Inc. (V): V is a large (top five) 8.29% of the portfolio stake. It was established in Q2 2012 at a cost-basis of around $30. Q2 2013 saw a one-third increase in the low-40s and that was followed with a 60% increase in Q2 2016 in the high 70s. Q1 2017 also saw another roughly one-third increase at prices between $79.50 and $90. The stock is now at ~$179.Note: Visa stock split 4-for-1 in March 2015. The prices quoted above are adjusted for that split.SBA Communications (SBAC): SBAC is a 5.86% portfolio stake. The original position was from H1 2014 at prices between $88 and $102. Q4 2015 saw a one-third increase at prices between $100 and $121 and a similar increase occurred in Q4 2016 as well at prices between $96 and $115. The stock currently trades well above those ranges at ~$231.Danaher Corporation (DHR): DHR is a 2.36% of the portfolio position established in Q4 2013 at prices between $47 and $55 and increased by roughly five-times in Q2 2014 at prices between $52 and $59. The stock is now at ~$137.Note: The prices quoted above are adjusted for the Fortive spinoff in July 2017.Goosehead Insurance (GSHD): GSHD is a minutely small position established in Q4 2018 and increased over the next two quarters. Goosehead Insurance had an IPO in April 2018 priced at $10. Since then, the stock has traded as high as $49. It currently goes for $44.73.Lamar Advertising (LAMR): The minutely small 0.04% LAMR stake was kept steady this quarter.Below is a spreadsheet that highlights the changes to Chuck Akre’s 13F stock portfolio as of Q3 2019:"