Fairholme Fund (NASDAQ: FAIRX - News) manager Bruce Berkowitz told Barron's good investments are getting hard to find, but he's still bullish on some of his most interesting fourth-quarter bets.
"My sense is that the investments made in the past 18 months will continue to do quite well." That's what Berkowitz had to say about the current stock-picking environment in a recent interview with Barron's, but the value investing legend conceded that we are nearing the point where interesting investments will become increasingly harder to find. Still, Berkowitz is bullish on the financial names found among his top U.S.-listed equity holdings from the end of 2009.
Berkowitz explained that firms in the financial sector write their best business when times are tough. As for Citigroup (NYSE: C - News), where Fairholme added notable stakes during Q4, Berkowitz went as far as to say, "the balance sheet is better than ever." He also reiterated his bullish view of AIG (NYSE: AIG - News), calling it "tremendously solid," and crediting faulty derivative plays for its recent weakness.
Fairlholme's stakes in Berkshire Hathaway (NYSE: BRK-A - News, BRK-B - News) and health insurance firm Humana (NYSE: HUM - News) have been among laggards over the past month. Meanwhile, Florida-based real estate development company St. Joe (NYSE: JOE - News) is a top performer among Fairholme's latest disclosed holdings. Berkowitz called the stock a "deep-value play," citing the beauty of the firm's real estate, which more buyers may get to experience when the Northwest Florida Beaches International Airport opens in May.
Investors can visit tickerspy.com to see all of Fairholme's top holdings and a chart of their combined performance. Members of the site can also track the aggregate performance of Fairholme's holdings throughout each market day.
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