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Bill Miller recently announced that he will not be managing Legg Mason Asset Management’s portfolio. Miller joined Legg Mason in 1981. He later became the chairman and CIO of the company and was once named “The Greatest Money Manager of the 1990’s” by Money magazine. Under his leadership, Legg Mason outperformed the market in 15 consecutive years from 1991 to 2005, which is very unlikely. But after that, the fund underperformed the market except in 2009.

In this article, we are going to focus on the top 10 big sells of Legg Mason in the third quarter. The company had at least $10 million invested in these positions at the end of June but sold out all the stakes during the third quarter.

Company

Ticker

Value (x1000)

HEWLETT PACKARD

HPQ

159212

BANK OF AMERICA

BAC

137759

CAPITAL ONE FINANCIAL

COF

62838

ALLIED WORLD ASSUR CO HLD

AWH

36014

HALLIBURTON COMPANY

HAL

30312

ALKERMES INC

ALKS

26278

COMERICA INC

CMA

22634

PETROHAWK ENERGY

HK

19185

AEROPOSTALE INC

ARO

13661

PENN WEST PETROLEUM

PWE

11153

The biggest position sold out by Legg Mason over the third quarter is Hewlett Packard Co. At the end of the second quarter, Legg Mason disclosed to own $159 million worth of HPQ stock. The fund did not report owning any shares of HPQ at the end of September. Since September 30, HPQ returned 19.55%, versus 12.50% for SPY. Besides Legg Mason, David Tepper’s Appaloosa Management also sold out its stake in HPQ during the third quarter.

Legg Mason also sold out all its Bank of America Corp position in the third quarter. The company had had $138 million invested in BAC at the end of June. BAC lost 10.31% so far in the fourth quarter, underperforming the market by nearly 23 percentage points. Louis Navellier and David Tepper sold out their BAC stakes during the third quarter as well.

Another large-cap stock that Legg Mason sold out during the third quarter is Halliburton Company. The company sold out all $30.3 million of HAL stock. HAL returned 12.16% since the end of September, slightly lower than the 12.50% for SPY during the same period. Ken Heebner and Joe DiMenna also sold out their stakes in HAL in the third quarter.

During the third quarter, Legg Mason also sold out its stakes in Capital One Financial Corp, Allied World Assurance Co Holdings AG, Alkermes Inc, Comerica Inc, Petrohawk Energy Corp, and Aeropostale Inc. We recommend investors to be careful about initiating new positions in these stocks.

Source: 10 Big Sells At Bill Miller's Legg Mason