Pabrai Buys Posco; Reduces Chesapeake Energy

Pabrai Buys Posco; Reduces Chesapeake Energy
By Fabarsi (Own work) [CC BY-SA 3.0], via Wikimedia Commons

Pabrai Investment Funds acquired a stake in Posco (ADR) (NYSE:PKX) and reduced its stockholding in Chesapeake Energy Corporation (NYSE:CHK) based on its 13F filing with the Securities and Exchange Commission (SEC) for the second quarter.

Pabrai Investment’s new position

The filing showed that Pabrai Investment Funds bought 977,634 shares of Posco (ADR) (NYSE:PKX) worth approximately $72.77 million. Posco is a Korean-based manufacturer and distributor of steel products such as hot rolled steels, steel plates, wire rods, cold rolled steels, galvanized steels, stainless steels and others.

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Last month, Posco (ADR) (NYSE:PKX) reported strong second-quarter financial results with a net income of KRW 487 billion ($473.8 million), a 770% increase sequentially. Its earnings per share were KRW 5,581.7 per share ($1.36) per ADR. The Korean steel company’s consolidated revenues increased 8.2% sequentially to KRW 16,704 billion ($16.3 billion).

Reduced position

During the quarter, Pabrai Investment Funds reduced its stake in Chesapeake Energy Corporation (NYSE:CHK) by 2,594,545 share to 668,000 shares. The investment management firm’s stake in the energy company is still worth around $20.76 million.

Chesapeake Energy Corporation (NYSE:CHK) is the sixth largest stockholding of Pabrai Investment Funds.

Other positions

Pabrai Investment Funds owns 6,333,296 shares of HORSEHEAD HOLDING CORP. (NASDAQ:ZINC) worth more than $115.6 million, its largest position in its portfolio.

The investment management firm also owns 5,936,015 shares of General Motors Company (NYSE:GM) Warrant (expires July 10, 2019). Its investment in the automakers’ warrant is worth approximately $110.15 million. It also owns 23,305 shares of the common stock of the automaker worth $846,000.

Pabrai Investment Funds also owns 4,875,000 shares of Bank of America Corp (NYSE:BAC) worth around $74.93 million and 1,420,000 shares of Citigroup Inc (NYSE:C) with a market value of around $66.88 million.

In addition, Pabrai Investment Funds also own stakes in Goldman Sachs Group Inc (NYSE:GS) and Berkshire Hathaway Inc (NYSE:BRK.B). The investment management firms has 106,863 shares of Goldman Sachs worth around $17.89 million and 7,025 Class B shares of Berkshire Hathaway worth approximately $889,000.

Monish Pabrai is a managing partner of Pabrai Investment Funds. He is a value investor and author of books on investing and operating a business entitled: The Dhandho Investor: The Low – Risk Value Method to High Returns and Mosaic: Perspectives on Investing.

Pabrai Investment Funds; equity portfolio for the second-quarter has a market value of around $480.77 million based on its 13F filing.

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