The 10th Annual New York Value Investing Congress takes place in New York on September 8th and September 9th 2014. ValueWalk will be providing coverage of the event- below are five new long ideas from legendary value investor, Alexander Roepers. Sign up for our free newsletter to get the coverage delivered to your inbox Alexander Roepers is the President of Atlantic Investment Management, which he founded in 1988. Atlantic Investment Management is a $1.7 billion, global equity hedge fund, which concentrates on a limited number of high quality, undervalued, out-of-favor companies, and using activism approach to unlock value. Atlantic has played a successful activist role in companies including; Kennametal, Dole Food, SPX, ITT, TNT, Dai Nippon Printing, Kurita Water, and Del Monte Foods. Prior to founding Atlantic, Roepers was Director of Corporate Development at Thyssen-Bornemisza Group and Dover Corporation.
Alexander Roepers on Atlantic Investment Management
2.3b AUM founded in 1988 L/S and concentrated Long only (6 stocks) up 12% ytd Constructive Shareholder Activism (CSA) Trade around core positions Looking for strong balance sheet, sustainable business, made profits in all markets, predictable cash flows, low insider control, solid liquidity, low cyclicality trading universe consists of about 1200 securities worldwide like to pay 7-8x ev/ebit, scale out at 10-12x ev/ebit, need at least 50% upside target only had 5 companies actually lose money over 22 years!! (this is really impressive and shows a high batting average) –doesn’t mean the names outperformed the markets Constructive Shareholder Activism debate stays outside the press, no board seats professional and non attacking dialogue with mgmt average appreciation of 32% vs 21% for S&P 500 on his 5 picks from last VIC
Alexander Roepers’ five new ideas
Triumph Group Inc (NYSE:TGI) Price target: $100 take over candidate trading cheaply buying back shares fixing operational issues Sulzer AG (SWX:SUN) (OTCMKTS:SULZF) EV/EBIT of 9,2x price target CHF165, upside of 35% all over them to reach their stated goals massively underperforming, similar business to Flowserve (which is trading at much higher valuation than Sulzer) could be well over CHF200 in 2 years Owens-Illinois Inc (NYSE:OI) price target $50, 62% upside 79 glass bottling plants, huge moat, would be nearly impossible to start a new glass bottling company trading at 9x ev/ebit having issues in venezula and a some others could earn $3.50+ in eps by 2015 (3.80-4 in 2016), should trade at 15×2015 EPS
price target: 105 euros, upside of 49% trading at 6.9x ev/ebit onshore/offshore and subsea driller 50% worldwide market share of installing pipes in deep sea oil improved execution, higher margins and record backlogs petrobras a huge customer (petrobras has tripled stock lately, and it should resemble some…) KOITO MANUFACTURING CO., LTD. (TYO:7276) price target 4200 yen (48% upside) provide auto lighting , with leading 20% market share they are leading the charge for cars to convert to LED completed large acquisitions in US, mexico, china and thailand double digit EPS growth and value expansion