Highlights of Glenview Capital's third quarter 13F filing (Part 9 of 10)
Glenview Capital and Fidelity National Financial
Glenview Capital Management added to its position in Fidelity National Financial (FNF) in the third quarter. Currently, the position accounts for 1.70% of the fund’s total portfolio. The fund added 3,306,600 shares to its existing holding during the quarter.
Overview of Fidelity National Financial
FNF is the largest title insurance company in the US. It’s also a leading provider of title insurance, escrow, and other title-related services for real estate transactions. Its business is organized into two groups:
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FNF Core Operations
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FNF Ventures—also known as FNFV (Fidelity National Financial Ventures)
Through its core operations, FNF is a leading provider of title insurance, technology, and transaction services to the real estate and mortgage industries. The company also provides mortgage technology solutions and transaction services. One of the company’s offerings is the MSP (Mortgage Servicing Package). It’s the residential mortgage servicing technology platform in the US. It’s provided through its majority-owned subsidiaries—BKFS (Black Knight Financial Services) and ServiceLink Holdings, LLC.
FNF’s FNFV segment includes a 51% stake in Remy. Remy is a leading designer, manufacturer, re-manufacturer, marketer, and distributor of aftermarket and original equipment components for automobiles, light trucks, heavy-duty trucks, and other vehicles.
FNFV also has a 55% ownership interest in American Blue Ribbon Holdings (ABRH). It’s the owner and operator of O’Charley’s, Ninety-Nine Restaurants, Max & Erma’s, Village Inn, and Bakers Square. This segment also controls casual-dining chain operator J. Alexander’s. It operates the Stoney River Legendary Steaks restaurants.
Distribution of tracking stock finalized
At the end of June, FNF completed the distribution of its two tracking stocks—Fidelity Group common stock and FNFV Group common stock. Under the plan, the company moved its portfolio company investments to a new subsidiary—FNFV. This was aimed at providing “greater transparency and clarity both to the inherent value of FNF’s portfolio company investments and the cash earnings capabilities of its core real estate, technology and mortgage services businesses.”
Revenue growth driven by technology subsidiary
FNF’s 3Q14 results missed estimates. Core revenue grew to $1.7 billion in the third quarter—compared to $1.6 billion in 3Q13. Adjusted net earnings were up to $145 million—compared to $115 million in the same period a year ago. The company posted core diluted EPS (earnings per share) of $0.51—compared to adjusted core diluted EPS of $0.50 in the same quarter last year. Total revenues for the title segment fell 2%.