Home Value Investing FPA Perennial Fund CC Call: The Long Case For O’Reilly

FPA Perennial Fund CC Call: The Long Case For O’Reilly

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Mark Hancock on FPA Perennial Fund 3Q conference call. Also see: FPA Paramount Fund Explains Their Investment Process

Mark: Good afternoon, everybody, and thank you for joining us today. We’d like to welcome you to the third quarter 2013 webcast for the FPA Perennial Fund. My name is Mark Hancock, and Director of Client Service and Business Development here at FPA. The audio, visual, and transcript aspects of today’s webcast will be made available on our website, fpafunds.com.

Steve: Thanks, Mark. We’ll start off with performance. Certainly the third quarter of this year, the stock market really took off. The Russell 2500 turned in a phenomenal gain of 9% for the quarter. The S&P was up over 5%. Perennial Fund had a very good quarter at plus 6.5%, and so not quite as stellar as the Russell 2500, but still quite a bit ahead of the broader S&P. And for very large gain in a quarter, our performance relative to the 2500 is fairly typical. For the most part over most of the time periods, Perennial Fund is well ahead of the S&P 500 and is certainly ahead of both indexes for the long-term 15-year period.

Now moving to some selected stock performance, beginning with the third quarter in Perennial, a couple of things to note on this chart. If we look at the best performers, if you look at the ending weight of those companies, you can see that those are all some of the larger weightings within the portfolio. If you jump across to the right and you look at the worst performers, you can see that generally speaking those are some of the smallest weights in the portfolio, again as you would expect considering we’re up 6.5% for the quarter.

In terms of best performers, O’Reilly reported a very strong second quarter, with same-store comps up 6.5%. Also Wabco reported an all-time record in quarterly earnings. And so both of those heavily weighted stocks were up a considerable amount.

FPA Perennial Fund Audio

FPA Perennial Fund Call Slides

FPA Perennial Fund conference call transcript pdf (and in scribd below)

FPA Perennial Fund Conference Call

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