Acadian Asset Management's Top Sells

by: The Analyst Hub

I discussed Top Buys of Acadian investment Management in a previous article. In addition to buys, it is also interesting to have a look at top companies where Acadian is booking profit and selling its holdings. Acadian typically sells stocks when: 1) Expected return of a stock deteriorates; 2) A better opportunity arises. The following is a list of Acadian's top seven sells by market value in the last quarter, according to the fund's most recent 13F filing with the SEC.



Shares Held - 06/30/2011

Shares Held - 09/30/2011

Change in shares

Biogen Idec Inc.





The Travelers Companies, Inc.





JPMorgan Chase & Co.





Petroleo Brasileiro





Research in Motion Limited





Exxon Mobil Corp.





Telefonos de Mexico, S.A.B. de C.V.





My favourite short candidate among above stocks is Research in Motion.

Research In Motion Ltd. is a designer, manufacturer and marketer of wireless solutions for the mobile communications market. RIM’s portfolio includes the BlackBerry wireless solution, the RIM Wireless Handheld product line, software development tools and other software and hardware.

After Microsoft’s (MSFT) deal with Nokia (NOK) and Google’s (GOOG) acquisition of Motorola (MMI), Research in Motion has become an orphan stock, and there are very low chances of its acquisition. Three major players will continue to dominate smartphone ecosystem in the near future: Apple (AAPL), the Nokia-Microsoft combination and the Google-Motorola combination. It will be very difficult for any other company to challenge this domination and thus every other player in the smartphone business is headed for a tough time ahead.

Nokia recently launched its S40 Asha series phones along with WP7 lumia phones. Asha series incorporates many smartphone software features into its S40 OS, including Nokia Maps, games such as Angry Birds, and a cloud-compressed browser experience important to control data usage in price-sensitive markets. Asha series products are priced well below BlackBerry products and they are likely to take a significant market share from RIMM in fast-growing messaging markets such as Latin America, India, and Indonesia. This will be another blow for RIMM, which is already struggling in developed markets.

Although RIMM is trading almost at its book value, I doubt that book value will serve as a good support/ bottom for the stock. Continued market share losses are a serious concern for the company and unless there are any signs of market share stabilization, I don’t think any sustainable change in stock trend can occur. I see the downside in the stock price continuing in near term.

For other companies in the above list, here are some of the basics including their business description and consensus growth expectations.

Biogen Idec Inc. is a global biotechnology company focused on discovering, developing, manufacturing and marketing products for the treatment of neurological disorders and other serious diseases. The company’s products include AVONEX, TYSABRI, FUMADERM and RITUXAN. Biogen Idec’s EPS forecast for the current year is 5.88 and next year is 6.31. According to the consensus estimates, its top line is expected to grow 5.80% current year and 4.90% next year.

The Travelers Companies, Inc. is a holding company. Through TRV’s subsidiaries, the company is engaged in providing a range of commercial, and personal property and casualty insurance products and services to businesses, government units, associations and individuals. The company is organized into three business segments: business insurance; financial, professional and international Insurance; and personal insurance. The Travelers’ EPS forecast for the current year is 3.35 and next year is 5.79. According to the consensus estimates, its top line is expected to grow 3.10% current year and 5.10% next year.

JPMorgan Chase & Co. is a financial holding company. JPMorgan Chase’s principal bank subsidiaries are JPMorgan Chase Bank, National Association, a national bank with United States branches in 23 states, and Chase Bank USA, National Association, a national bank that is the credit card-issuing bank. JPMorgan Chase’s EPS forecast for the current year is 4.58 and next year is 4.93. According to the consensus estimates, its top line is expected to decline 4.30% current year and 0.50% next year.

Petroleo Brasileiro SA Petrobras is a Brazilian integrated oil and gas company. It operates in five segments: exploration and production; refining, commercialization and transport of oil and natural gas; petrochemicals; distribution of derivatives; electrical energy, biofuels and other renewable energy sources. Directly or through its subsidiaries, Petrobras is engaged in the research, extraction, refining, processing, commercialization and transport of oil from wells, shales and other rocks, its derivatives, natural gas and other liquid hydrocarbons, as well as in activities related to energy, promoting research, development, production, transport, distribution and commercialization of all forms of energy.

Exxon Mobil Corporation is a manufacturer and marketer of commodity petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics and a range of specialty products. It also has interests in electric power generation facilities. The company has several divisions and hundreds of affiliates with names that include ExxonMobil, Exxon, Esso or Mobil. Exxon Mobil’s EPS forecast for the current year is 8.55 and next year is 8.42. According to the consensus estimates, its top line is expected to grow 23.60% current year and decline 5.50% next year.

Telefonos de Mexico owns and operates a fixed-line telecommunications system in Mexico. The company also provides other telecommunications and telecommunications-related services, such as corporate networks, internet access services, information network management, telephone and computer equipment sales, and interconnection services to other carriers. Telefonos de Mexico’s EPS forecast for the current year is 1.32 and next year is 1.23. According to the consensus estimates, its top line is expected to decline 6.00% current year and 2.00% next year.

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