Many leading funds filed forms 13-D and 13-G (and form 4) with the SEC this week (March 12th to March 15th, 2011), indicating that they had amended their ownership in U.S. traded public companies. The following are the most notable institutional trades (ex-healthcare and tech sectors that are covered in a separate article, hyperlinked above) based on our analysis of those filings (for more info on Forms 13-D and 13-G, and how to interpret that, please refer to the end of this article):
Francesca's Holdings Corp. (FRAN): FRAN operates a specialty retail chain of women's apparel boutique stores in 38 States targeting fashion-conscious 18 to 35 year olds. On Wednesday, leading New York-based private equity firm CCMP Capital, that focuses on leveraged buyout and growth capital transactions, filed SEC Form 13G/A indicating that it holds 15.71 million or 36.1% of outstanding shares, a decrease from the 26.71 million shares it held at the end of Q4.
FRAN reported a strong Q4 (ending January) on Tuesday, beating analyst earnings (19c v/s 16c) and revenue estimates ($62 million v/s $57 million), and it also guided Q1 and FY 2012 revenues and earnings higher. Revenues for the current quarter were 55% above the year-ago quarter, with earnings growth at 90% year-over-year, aided by improving gross margins and lower operating expenses as a percentage of sales. Its shares were rewarded, up over 10% since the report, and currently trade at 31 forward P/E compared to the average of 12.6 for its peers in the shoes and related apparel group.
Polypore International (PPO): PPO is a technology filtration company that develops, manufactures, and markets micro-porous membranes used in the separation and filtration processes. It operates in two market segments, Energy Storage and Separations Media. On Monday, Fidelity Investments and Wells Fargo & Co. both filed SEC Forms 13G/A indicating that they decreased their ownership of PPO shares. Fidelity indicated that it held 3.90 million or 8.4% of outstanding shares, a decrease from the 6.88 million shares it held at the end of Q4, and Wells Fargo indicated that it held 1.82 million or 3.9% of outstanding shares, a decrease from the 2.59 million shares it held at the end of Q4.
PPO shares have been in a downtrend for most of the past year, slashed by almost half from the $74 highs in July of last year, and are currently trading near 52-week lows. In its most recent Q4, the company missed on both analyst revenue and earnings estimates, and guided lower for the upcoming Q1 period. Its shares trade at a current 16.3 P/E and 3.5 P/B compared to averages of 13.8 and 1.3 for the electronics miscellaneous components group.
Vera Bradley Inc. (VRA): VRA is engaged in the design, production, marketing and retail of functional accessories for women, including handbags, accessories, and travel and leisure items. On Monday, Fidelity Investments filed SEC Form SC 13G/A indicating that it holds 3.08 million or 7.6% of outstanding shares, a decrease from the 5.12 million shares it held at the end of Q4. VRA reported a strong Q4 yesterday after the market closed, beating analyst earnings (50c v/s 47c) and revenue estimates ($135 million v/s $130 million), but gave mixed guidance going forward. Its shares were down about 10% on Thursday, and trade at a current 23.6 P/E and 14.5 P/B compared to averages of 17.0 and 2.2 for its peers in the apparel & shoe retail group.
Superior Energy Services (SPN): SPN provides specialized oilfield services and equipment for the production and drilling needs of oil and gas companies. On Monday, Fidelity Investments filed SEC Form SC 13G/A indicating that it holds 5.37 million or 3.4% of outstanding shares, a decrease from the 7.15 million shares it held at the end of Q3. SPN is undervalued, and trades at a discount current 7 forward P/E and 1.6 P/B compared to averages of 12.8 and 2.3 for its peers in the oil field machinery & equipment group, while earnings are projected to almost double from $2.08 in 2011 to $4.03 in 2013.
Credit: Fundamental data in this article were based on SEC filings, Zacks Investment Research, Thomson Reuters and Briefing.com. The information and data is believed to be accurate, but no guarantees or representations are made.
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Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.