By: Manisha Sethi Jul. 12, 2018
The Edgar Lomax Company disclosed its SEC 13F filings for Q1 2018 on May 14 and reported a portfolio value of $1,391.54 million, with its top 10 holdings accounting for 41.52% of the portfolio. The investor’s top 5 holdings are Cisco Systems, Inc. (CSCO), Target Corp. (TGT), Allstate Corp. (The) (ALL), CVS Health Corporation (CVS), and Pfizer, Inc. (PFE). The Edgar Lomax Company was set up in September 1986 as a registered investment advisor by President and CIO Randall R. Eley and is headquartered in Alexandria, Virginia. The firm is dedicated to serving institutional and high net worth clients through its separate accounts product and retail clients through its mutual fund, the Edgar Lomax Value Fund. Their sole business is large-cap value equity investment management. The firm employs fundamental analyses with a bottom-up stock picking approach to make its investments. In addition, it benchmarks its performance against the S&P 500 and S&P Global 1200 indexes.
According to a Raltin analysis, about 61.45% or 51 new stock buys by The Edgar Lomax Company outperform S&P 500 and the remaining (between Q1 2014 and Q1 2018) underperform S&P 500. Of the 83 new purchases, 25 stocks outperform the index by more than 10% and only 17 underperform by 10%. Raltin’s detailed methodology to calculate S&P 500 outperformance can be found here. The next table shows the total number of new stock purchases along with the S&P performance categories.
| S&P outperformance category | Number of new stock purchases | Total new purchases (%) |
|---|---|---|
| >20% | 9 | 10.84 |
| 10 to 20% | 16 | 19.28 |
| 0 to 10% | 26 | 31.33 |
| -10 to 0% | 15 | 18.07 |
| -20 to -10% | 11 | 13.25 |
| <-20% | 6 | 7.23 |
| Total stocks | 83 |
Of the 24 new stocks purchased in this quarter, Walgreens Boots Alliance, Inc. (WBA) and NextEra Energy, Inc. (NEE) account for 3.83% and 2.53% of the portfolio. The table below lists the new purchases as well as the number of shares and holding value.
| Stocks | Number of shares | Holding value ($1,000) |
|---|---|---|
| Walgreens Boots Alliance, Inc. (WBA) | 8,13,975 | 53,291 |
| NextEra Energy, Inc. (NEE) | 2,15,650 | 35,222 |
| Oracle Corp. (ORCL) | 4,57,000 | 20,908 |
| Lowe’s Companies, Inc. (LOW) | 2,32,550 | 20,406 |
| Citigroup, Inc. (C) | 2,90,700 | 19,622 |
| Medtronic plc (MDT) | 1,83,075 | 14,686 |
| Apple, Inc. (AAPL) | 69,475 | 11,657 |
| FedEx Corp. (FDX) | 47,075 | 11,303 |
| American Express Co. (AXP) | 1,18,475 | 11,051 |
| Gilead Sciences, Inc. (GILD) | 1,35,150 | 10,189 |
| Schlumberger Ltd. (SLB) | 1,43,925 | 9,323 |
| PepsiCo, Inc. (PEP) | 80,875 | 8,828 |
| Kinder Morgan, Inc. (KMI) | 5,36,350 | 8,077 |
| The Kraft Heinz Company (KHC) | 1,24,550 | 7,758 |
| Twenty-First Century Fox, Inc. (FOXA) | 1,50,975 | 5,539 |
The following table lists The Edgar Lomax Company ’s portfolio value from Q1 2017 to Q1 2016 and the top holdings that outperform the S&P 500 IRR in each quarter. Several new purchases outperform S&P 500; in particular, California Resources Corp. (CRC), Bank of America Corp. (BAC), Morgan Stanley (MS), and Accenture plc (ACN) drastically outperform the index.
| Period | Total portfolio value ($Mn) | Top holdings (ticker, % of IRR difference from S&P 500) |
|---|---|---|
| Q1 2017 | 1,493.52 | Bank of America Corp. (BAC, 15.55), Morgan Stanley (MS, 14.38), |
| Q4 2016 | 1,416.6 | Accenture plc (ACN, 11.35), |
| Q3 2016 | 1,316.95 | |
| Q2 2016 | 1,463.36 | |
| Q1 2016 | 1,594.32 | California Resources Corp. (CRC, 1,345.49), JPMorgan Chase & Co. (JPM, 33.62), Comcast Corp. (CMCSA, 8.38) |