Dodge & Cox Owns 11% of Celanese and 8% of Cadence Design Systems

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Dodge & Cox Owns 11% of Celanese and 8% of Cadence Design Systems

According to a 13G  filed with the SEC, Dodge & Cox, has upped its stake in Celanese Corporation (NYSE:CE) to 16,689,703 from 14,041,091 as of the end of the Second quarter. The value oriented investment firm, now owns 10.5% of the company. Dodge & Cox’s stake in the Irving, Texas based firm is now worth approximately $635 million.

Celanese Corporation (Celanese) is a global technology and speciality materials company. The company report earnings on October 23rd. CE reported Q3 2012 EPS of $0.93 versus consensus of $0.90 and a year ago $1.27. Bears are concerned  that Celanese Corporation (NYSE:CE)’s methanol contract with Trinidad has given it unsustainably high margins and that Ticona margins have significant downside from EU auto production. The company trades at a P/E of  of approximately 10.1.

For the nine months ended 30 September 2012, Celanese Corporation revenues decreased 5% to $4.92B. Net income before extraordinary items increased less than 1% to $512M. Revenues reflect Acetyl Intermediates segment decrease of 9% to $2.12B, Advanced Engineered Materials segment decrease of 4% to $962M, Industrial Specialities segment decrease of 2% to $933M.

In a seperate filing with the SEC, Dodge & Cox now owns 21,574,075 shares of  Cadence Design Systems, Inc. (NASDAQ:CDNS),  or 7.7% of shares outstanding. At the end of the second quarter, Dodge & Cox owned 25,664,125 shares of the San Jose based company; this represents a decrease of approximately 16%. Cadence Design Systems, Inc. (NASDAQ:CDNS) is a market leader in the electronic design automation industry, providing a combination of leading-edge design services, electrical engineering software tools, and software support.

On October 25th, Cadence Design Systems, Inc. (NASDAQ:CDNS) once reported a strong quarter and raised revenue, earnings, bookings and cash flow guidance. While the company remains vigilant for signs of softening demand due to the macro climate, the company is not seeing it at this point.

For the nine months ended 29 September 2012, Cadence Design Systems, Inc. revenues increased 17% to $980.8M. Net income increased from $61.3M to $126.1M. Revenues reflect United States segment increase of 15% to $414.9M, Asian Countries segment increase of 36% to $187.3M. Net income benefited from Interest expense decrease of 21% to $25.8M (expense), Gains on Sale of Foreign Exchange increase from $466K (expense) to $2.5M (income).

Disclosure: No position in any securities mentioned.



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