Jeff Ubben Nearly Exits Position in Adobe Systems

GuruFocus.com

Tue, May 31, 2016, 9:55 PM

- By David Goodloe

Jeff Ubben (Trades, Portfolio) of ValueAct Holdings made more transactions in the first quarter than he has made in a single quarter in a year, but more than half were reductions or divestitures of stakes in his portfolio. The guru made one new buy in the first quarter and added to two existing stakes.

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Ubbenas most significant first-quarter transaction was the near-divestiture of his stake in Adobe Systems Inc. (ADBE), a San Jose, California-based computer software company. Ubben sold 14,004,739 shares for an average price of $86.68 per share. The deal had a -9.11% impact on Ubbenas portfolio.

The remaining stake of 6,000 shares is 0.01% of Ubbenas total assets. Adobeas leading shareholder among the gurus is PRIMECAP Management (Trades, Portfolio) with a stake of 33,213,085 shares. The stake is 6.64% of Adobeas outstanding shares and 3.23% of PRIMECAPas total assets.

Adobe has a P/E of 63.4, a forward P/E of 27, a P/B of 7.1 and a P/S of 10. GuruFocus gives Adobe a Financial Strength rating of 8/10 and a Profitability and Growth rating of 7/10.

Adobe sold for $99.47 per share Tuesday. The DCF Calculator gives Adobe a fair value of $16.8.

Ubben trimmed his stake in Motorola Solutions Inc. (MSI), a Chicago-based telecommunications equipment company, by more than 53% with the sale of 9,375,000 shares for an average price of $67.47 per share. The transaction had a -4.44% impact on Ubbenas portfolio.

The remaining stake of 8,213,576 shares is 4.7% of Motorolaas outstanding shares and 6.21% of Ubbenas total assets. Ubben is Motorolaas leading shareholder among the gurus.

Motorola has a P/E of 23.9, a forward P/E of 13.8 and a P/S of 2.4. GuruFocus gives Motorola a Financial Strength rating of 7/10 and a Profitability and Growth rating of 4/10.

Motorola sold for $69.27 per share Tuesday. The DCF Calculator gives Motorola a fair value of $32.

Ubben pared his stake in Agrium Inc. (AGU), a Canadian supplier of agricultural products and services, by more than 68%. The guru sold 6,833,151 shares for an average price of $86.37 per share. The deal had a -4.23% impact on Ubbenas portfolio.

The remaining stake of 3,170,300 shares is 2.29% of Agriumas outstanding shares and 2.79% of Ubbenas total assets. Ubben is Agriumas leading shareholder among the gurus.

Agrium has a P/E of 13.4, a forward P/E of 13.7, a P/B of 2 and a P/S of 0.9. GuruFocus gives Agrium a Financial Strength rating of 7/10 and a Profitability and Growth rating of 8/10.

Agrium sold for $90.2 per share Tuesday. The DCF Calculator gives Agrium a fair value of $196.15 with a margin of safety of 54%.

Ubben reduced his stake in MSCI Inc. (MSCI), a New York City-based provider of equity, fixed income and hedge fund stock market indexes and equity portfolio analysis tools, by nearly 36%. Ubben sold 2,266,411 shares for an average price of $69.14 per share. The transaction had a -1.13% impact on Ubbenas portfolio.

The remaining stake of 4,060,900 shares is 4.21% of MSCIas outstanding shares and 3% of Ubbenas total assets. Ubben is MSCIas leading shareholder among the gurus.

MSCI has a P/E of 35.3, a forward P/E of 23, a P/B of 12.8 and a P/S of 8. GuruFocus gives MSCI a Financial Strength rating of 7/10 and a Profitability and Growth rating of 9/10.

MSCI sold for $79.79 per share Tuesday. The DCF Calculator gives MSCI a fair value of $41.26.

Ubben sold his 16,504,295-share stake in Halliburton Co. (HAL), a Houston-based oilfield services and equipment company, for an average price of $32.57 per share. The divestiture had a -3.89% impact on Ubbenas portfolio.

Bill Nygren (Trades, Portfolio) is Halliburtonas leading shareholder among the gurus with a stake of 6,601,000 shares. The stake is 0.77% of Halliburtonas outstanding shares and 1.59% of Nygrenas total assets.

Halliburton has a forward P/E of 42.4, a P/B of 2.8 and a P/S of 1.7. GuruFocus gives Halliburton a Financial Strength rating of 6/10 and a Profitability and Growth rating of 6/10.

Halliburton sold for $42.18 per share Tuesday. The DCF Calculator gives Halliburton a fair value of $-47.1.

Ubben also sold his 725,000-share stake in Towers Watson & Co. (TW), a professional services company based in Arlington, Virginia, for an average price of $125.73 per share. The divestiture had a -0.64% impact on Ubbenas portfolio.

No gurus own shares in Towers Watson. In addition to Ubben, Pioneer Investments (Trades, Portfolio), Ron Baron (Trades, Portfolio), Mario Gabelli (Trades, Portfolio), Chuck Royce (Trades, Portfolio), John Rogers (Trades, Portfolio), Jim Simons (Trades, Portfolio) and Joel Greenblatt (Trades, Portfolio) sold their stakes in Towers Watson in the first quarter.

Towers Watson has a P/E of 20.1, a forward P/E of 13.4, a P/B of 2.9 and a P/S of 2.3. GuruFocus gives Towers Watson a Financial Strength rating of 6/10 and a Profitability and Growth rating of 8/10.

Towers Watson sold for $123 per share Tuesday. The DCF Calculator gives Towers Watson a fair value of $94.48.

The guru acquired a 541,115-share stake in Alliance Data Systems Corp. (ADS), a Plano, Texas-based provider of loyalty marketing services, for an average price of $219.63 per share. The purchase had a 1.19% impact on Ubbenas portfolio.

The stake is 0.92% of Alliance Data Systemsa outstanding shares and 1.19% of Ubbenas total assets. Ubben is Alliance Data Systemsa leading shareholder among the gurus.

Alliance Data Systems has a P/E of 25/7, a forward P/E of 11.3, a P/B of 7.6 and a P/S of 2.1. GuruFocus gives Alliance Data Systems a Financial Strength rating of 7/10 and a Profitability and Growth rating of 8/10.

Alliance Data Systems sold for $222.19 Tuesday. The DCF Calculator gives Alliance Data Systems a fair value of $233.29 with a margin of safety of 5%.

Ubben boosted his stake in Willis Towers Watson PLC (WLTW), a London-based risk management, insurance brokerage and advisory company, by more than 10%. Ubben bought 724,999 shares for an average price of $115.19 per share. The transaction had a 0.86% impact on Ubbenas portfolio.

The stake, now 7,680,015 shares, is 5.55% of Willis Towers Watsonas outstanding shares and 9.1% of Ubbenas total assets. Ubben is Willis Towers Watsonas leading shareholder among the gurus.

Willis Towers Watson has a P/E of 31.2, a forward P/E of 14.7, a P/B of 1.6 and a P/S of 2.3. GuruFocus gives Willis Towers Watson a Financial Strength rating of 6/10 and a Profitability and Growth rating of 7/10.

Willis Towers Watson sold for $128.02 per share Tuesday. The DCF Calculator gives Willis Towers Watson a fair value of $44.09.

Ubben raised his stake in CBRE Group Inc. (CBG), a real estate company based in Los Angeles, by more than 5%. The guru bought 1,604,500 shares for an average price of $27.6 per share. The acquisition had a 0.46% impact on Ubbenas portfolio.

The stake, now 32,931,905 shares, is 9.82% of CBRE Groupas outstanding shares and 9.47% of Ubbenas total assets. Ubben is CBRE Groupas leading shareholder among the gurus.

CBRE Group has a P/E of 18.9, a forward P/E of 17, a P/B of 3.5 and a P/S of 0.9. GuruFocus gives CBRE Group a Financial Strength rating of 5/10 and a Profitability and Growth rating of 6/10.