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Many leading funds filed forms 13-D and 13-G (and form 4) on basic materials and energy sector stocks with the SEC last week, including Jana Capital, Royce & Associates and BMO Financial Corp., indicating that they had amended their ownership in U.S. traded public companies. The forms are required to be filed within 10 days, so the institutions traded these shares sometime at or after the end of last year. Also, we have included, when applicable, SEC Form 4 filings by Institutions that are considered corporate insiders by virtue of their holding more than 10% ownership, and in many cases having representation on the board of directors. The following are the most notable filings in the basic materials and energy sectors last week (for more info on Forms 13-D and 13-G, and how to interpret that, please refer to the end of this article):

Marathon Petroleum (MPC): MPC engages in the refining, transporting and marketing of petroleum products. It operates six refineries in the Gulf Coast and Midwest regions that refine crude oil and other feedstocks, and distribute the refined products through barges, terminals and trucks. On Thursday, New York based event-driven hedge fund with a shareholder activist orientation, Jana Partners LLC, with over $1.7 billion in equity assets per its latest 13-F Q3 filing, filed SEC Form SC 13D indicating that it holds 19.7 million or 5.5% of outstanding shares, a new position for the fund since the end of Q3. This makes Jana the largest institutional holder of MPC, ahead of AllianceBernstein (19.1 million shares) and Fidelity Investments (17.2 million shares). MPC is undervalued, trading at 7-8 forward P/E and 1.3 P/B compared to averages of 12.0 and 2.5 for its peers in the oil refining and marketing group, while earnings are projected to rise from $1.80 in 2010 to $6.87 in 2011 and then fall to $5.06 in 2012. Also, it has a 2.7% dividend yield, almost at par with the 3.0% average for its peers.

In its filing, Jana outlined its belief that MPC shares are currently undervalued and represent an attractive investment opportunity, and further indicated that it would continue its discussions with MPC management as well as the board of directors, shareholders and other parties with the goal of seeking changes that would increase shareholder value. Jana has a track record of pressing companies to break-up, and it remains to be seem if they pursue a similar strategy at MPC, given that the company is already the result of a break-up earlier last year from Marathon Oil (MRO), when MRO split into an exploration and production business and a refining business.

New Gold Inc. (NGD): NGD is a Canadian mining company engaged in the exploration of gold, silver and copper in Brazil, Australia, Mexico, Canada and Chile. On Wednesday, Chicago-based BMO Financial Corp., a holding company that is a subsidiary of the Bank of Montreal, and with over $48 billion in U.S. equity assets per its latest 13-F Q3 filing, filed SEC Form SC 13G indicating that it held 26.5 million or 5.9% of outstanding shares, an increase of 25.2 million shares from the 1.3 million shares it held at the end of Q3. NGD trades at a premium 15-16 forward P/E and 2.1 P/B compared to averages of 12.0 and 3.6 respectively for its peers in the mining miscellaneous group, while earnings are projected to grow strongly from 33c in 2010 to 65c in 2012 at an annual growth rate of 40.4%.

Pan American Silver Corp. (PAAS): PAAS is a Canadian mining company focused on silver, with mining operations in Mexico, Peru, Argentina and Bolivia. On Thursday, New York-based mutual fund company Royce & Associates, with over $27 billion in equity assets per its latest 13-F Q3 filing, filed SEC Form SC 13G/A indicating that it holds 11.0 million or 10.4% of outstanding shares, an increase of 167,450 shares from the 10.8 million shares it reported at the end of Q3. PAAS trades at a current 12-13 P/E on a TTM basis and 1.7 P/B compared to averages of 18.8 and 2.9 for its peers in the silver mining group, while earnings are projected to increase over 25% from $2.39 in 2011 to $2.99 in 2012. Its shares are weaker today after it announced earlier in the day that it would buy Canadian gold and silver mining company Minefinders Corp. (MFN) for C$15.60 per share in cash, at a 36% premium to last week's closing price, or alternatively, MFN shareholders can opt for a combination of cash and PAAS shares consisting of either 0.55 shares of PAAS and C$1.84 in cash or 0.6235 shares of PAAS.

Silver Standard Resources Inc. (SSRI): SSRI is a Canadian mining company engaged in silver and gold exploration in Argentina, Mexico, Chile, U.S. and Australia. On Friday, New York-based mutual fund company Royce & Associates, with over $27 billion in equity assets per its latest 13-F Q3 filing, filed SEC Form SC 13G/A indicating that it holds 10.4 million or 12.9% of outstanding shares, a decrease of 321,900 shares from the 10.7 million shares it reported at the end of Q3.

General Discussion

Form 13-D is commonly referred to as "beneficial ownership report," and is required when a person or a group of persons acquires beneficial ownership of more than 5% of the voting class of a company's equity securities. Form 13-G is the abbreviated version of the form that is allowed under certain circumstances.

The information in forms 13-D and 13-G is extremely timely as it is required to be filed within 10 days after the purchase, in contrast to 13-F quarterly filings by Institutions that are filed every three months. The information contained in 13-F filings, thereby, can be as much as 18 weeks old by the time it is disseminated to the public. Furthermore, by virtue of their 5% ownership in public companies, the information contained in the 13-D and 13-G filings indicates only high confidence or high conviction moves by institutions and insiders, and hence can be interpreted to be of greater relevance to the investment community than the 13-F quarterly filings. Furthermore, 13-D and 13-G filings often are a precursor to a hostile takeover, company breakups and other "change of control" events, and often they will include a letter to management explaining the reason for their taking a large stake in the company.

Credit: Fundamental data in this article were based on SEC filings, I-Metrix by Edgar Online, Zacks Investment Research, Thomson Reuters and Briefing.com. 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 our "opinions" and we may be wrong. We 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 our 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.

Source: Analysis Of Institutional 5% Ownership Filings Last Week In Basic Materials And Energy Sectors