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What do the top Hedge Fund and Mutual Fund gurus like in the Industrial Machinery Industry? This article, the 28th in a series, identifies through a research of the latest available institutional 13-F filings the gurus that are most invested in the Industrial Machinery Industry, and the specific stocks within that industry that they prefer to hold in their portfolios. The Industrial Machinery Industry in this case includes industrial, construction and mining machinery and equipment companies, but not oil and gas machinery and equipment as these will be looked at separately in another article.

Also, please note that this article will be among the last in this series, as the latest March 2011 quarter 13-F institutional filings are now beginning to come out. About 40% were out as of this weekend, and most should be filed by the end of this week. As such, once 13-F filings are complete for all guru funds, in the next series starting the end of this week to the beginning of next week, I will bring to you the "Top New and Added Picks" of guru funds by industry/sector detailing this time not the top holdings, but more importantly what new positions they took and what existing positions they added to in the latest March 2011 quarter. Please check my article page for previous articles in this series.

A guru is defined as someone who is regarded as having great knowledge, wisdom, and authority in a certain area. When it comes to hedge funds, there are a number of ways to anoint leading managers as gurus including long-term performance, low portfolio volatility and an elite reputation in the investment community.

Many of us are familiar with leading investors and hedge fund managers such as Warren Buffet, George Soros, Carl Icahn and Julian Robertson, but the hedge fund community alone includes over 9,000 funds; add in mutual funds, ETFs, and other investment entities and the number is likely to be at least two to three times that number. While there is no official list of gurus, less than one percent or between 100 to 200 fund managers are commonly believed by the larger investment community to have earned the distinction of being called gurus.

The study of the investing habits of gurus can be informative as these are very savvy, well-respected investors with high personal net worth deploying large sums of capital from their funds on a regular basis. They have a long-term track record of success, and while one can easily just ride their coattails, the savvy investor may want to use these lists as a starting point to conduct their own due diligence.

The total capitalization of the U.S. equity markets is somewhere in the $15 trillion range, and the total market capitalization of Industrial Machinery companies (as defined before) is $365 billion or 2.45% of the overall market. The table lists the top five investment gurus whose funds have invested at least 3.7% or one-and-a-half times the average. The following is a list of the top industrial machinery company picks of guru funds over-concentrated in that sector:

  • Joy Global Inc. (JOYG), a manufacturer of continuous miners, long-wall shearers, electric shovels and blast-hole drills for coal and mineral extraction; and Caterpillar Inc. (NYSE:CAT), a manufacturer of construction and mining equipment, diesel and natural gas engines and turbines.
  • Manufacturers of industrial fluid control products such as Gardner Denver Inc. (NYSE:GDI), a manufacturer of compressor, vacuum and fluid transfer products used in industrial, water jetting and drilling applications; Circor International Inc. (NYSE:CIR), a manufacturer of valves and fluid control products for the aerospace, cryogenic, instrumentation and steam markets; Sun Hydraulics Inc. (NASDAQ:SNHY), a manufacturer of screw-in hydraulic cartridge valves and manifolds for fluid power systems in construction equipment; Flowserve Corp. (NYSE:FLS), a manufacturer of engineered pumps, valves, and mechanical seals for engineering and construction applications; Gorman-Rupp Co. (NYSEMKT:GRC), a manufacturer of pumps and related fluid control equipment for the wastewater, construction, petroleum and heating markets; and Idex Corp. (NYSE:IEX), a manufacturer of fluid-handling technologies for positive displacement pumps and dispensing equipment.
  • Ingersoll-Rand Co CLA (NYSE:IR), a manufacturer of a diverse range of industrial and commercial products including climate control units, fluid handling systems, compressed air systems, biometric access control systems and energy efficient solutions.
  • Robbins & Myers Inc. (NYSE:RBN), a manufacturer of a diverse range equipment and systems for industrial applications including oil and gas exploration and recovery, specialty chemical, waste-water treatment, pharmaceutical and specialty chemical markets.
  • Rockwell Automation Inc. (NYSE:ROK), a manufacturer of motor and industrial automation control and power systems, and information architecture.
  • Tennant Co. (NYSE:TNC), a manufacturer of motorized floor maintenance and outdoor cleaning equipment, specialty coating and preservation products.
  • Kaman Corporation (NYSE:KAMN), a distributor of industrial equipment and aerospace equipment products worldwide.
  • Gerber Scientific Inc. (NYSE:GRB), a manufacturer of digital imaging systems and software for the sign making and specialty graphics industries.
  • Terra Nova Royalty Corp. (NYSEARCA:TTT), a provider of technologies, engineering and equipment for the cement, coal and minerals processing industries worldwide.


Fund and guru

Type of Fund

Assets Under Management

Percent Equity Portfolio invested in Equities of Industrial Machinery Companies

Major Industrial Machinery company positions in Portfolio

Hillman Capital Management, Inc. (Mark Hillman)

Asset Manager including Mutual Funds

$450 million



Keeley Asset Management (John Keeley)

Mutual Fund – Small- and Mid-capitalization equities

$ 6.2 billion



GAMCO Investors, Inc. Et Al (Mario Gabelli)

Hedge Fund -Shareholder Activist

$ 13.6 billion


FLS, KAMN, IEX, CIR, CAT (thru on-going acquisition of BUCY), ROK, TNC, GRC, RBN, GRB

Centaur Capital Partners, LP (Zeke Ashton)

Hedge Fund

$ 98 million



Bethesda, Maryland-based Hillman Capital Management, headed by guru Mark Hillman is a value manager, and invests in out-of-favor companies that have quantitative competitive advantages, and whose value is not yet factored into the market.

John Keeley is portfolio manager for the $6.2 billion Mutual Fund Keeley Fund Management. He focuses on the small- and mid-capitalization sector of the equities market, and focuses on companies undergoing corporate events such as spin-offs, companies emerging from bankruptcy, and distressed utilities.

GAMCO Investors, Inc. Et Al, headed by guru Mario Gabelli, uses a growth at a reasonable price (GARP) approach in making his stock picks. Besides his hedge fund, GAMCO Asset Management with over $30 billion in AUM also manages the GAMCO family of mutual funds.

Zeke Ashton's Centaur Capital Partners manages the investments for the Centaur Value Fund and the Tilson Dividend Fund. Its investment philosophy is Buffet-like based upon value principles, and selects stock investments based upon true business value as reflected by asset value, cash flow generation, management quality, and the competitive advantages of the underlying businesses when such stocks are available at compelling prices.

Credit: Historical fundamentals including operating metrics and stock ownership information were derived using I-Metrix by Edgar Online, Zacks Investment Research, DailyGraphs, Thomson Reuters and Fund data including assets under management and firm profiles are sourced mostly from The information and data is believed to be accurate, but no guarantees or representations are made.

Disclaimer: Material presented here is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research and reach your own conclusion. Further, these are my opinions and I may be wrong. I may have positions in securities mentioned in this article. You should take this into consideration before acting on any advice given in this article. If this makes you uncomfortable, then do not listen to my thoughts and opinions. The contents of this article do not take into consideration your individual investment objectives so consult with your own financial adviser before making an investment decision. Investing includes certain risks including loss of principal.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.