13F: EAGLE

Archives updated through last Q.

I’ve been slacking on the Sunday 13F updates due to all the travel, good news is they will continue again weekly starting this week.  I have 13 queued up that should take us through year end, if you have any suggestions let me know!

CHAPTER 11 – Eagle Capital Management, Ravenel Boykin Curry

Value investing seems to be in the genes at New York-based Eagle Capital Management, where Ravenel Boykin Curry IV not only gets his name but also his investment style from his father, Ravenel Boykin Curry III. Curry IV is the current managing partner of Eagle Capital, the hedge fund founded by his father in 1988.

The current Curry runs the firm under the same philosophy used by his dad and which has been in play at Eagle since inception. As stated on the firm’s home page, Eagle maintains a concentrated portfolio of mainly large cap stocks that it selects using bottom-up research.The Curry approach to investment is on display in the firm’s quarterly letters to investors. In one, dated Jan. 24, 2010, Boykin Curry IV focused on the power of long-term investing. “The fact that so many investors are focused on the near-term gives those with a longer-term perspective great advantage,” he wrote. As short-term investors periodically crowd into some stocks and shun others, they create market mispricings, a phenomenon that he compared to a rubber band being stretched. “A long-term investor profits when the rubber band snaps back to rationality, as it always does.”

When examining fundamentals, Curry keeps an eye out for companies with beaten-down share prices that appear to have good long-term prospects. Case in Point: Goldman Sachs Group, which had fallen from about $175 in early 2010 to around $95 by October of the same year.  Speaking at the Value Investing Congress that October, Curry said the market was wrong, that Goldman’s assets were worth closer to $150 a share than $95, and that they could go as high as $172. It took some time and the ride was rocky, but the stock passed $150 in Feb., 2013 and broke through $170 in July, 2014.

Well-known names like Goldman are typical of Boykin’s picks. As of June 30, 2015, Eagle had 59 positions with a market value of approximately $25 billion. The top 10 holdings represented about half of the total value and included names like Microsoft, Oracle, and Citigroup. The number three holding: Warren Buffet’s Berkshire Hathaway. Indeed, Eagle often invests in the same names as Berkshire. Meryl Whitmer, another Eagle partner, is even on the board of directors at Berkshire.  Many readers will also recognize Meryl from her frequent Barron’s Roundtable appearances, on which she has been featured since 1999.

While Eagle operates out of offices in New York and Boykin Curry is a fixture on the city’s social and non-profit scene, his family roots are in the Greenwood, S.C. His grandfather, Ravenel Boykin Curry, Jr., who died in 2012 at the age of 96, owned and operated Citizens Trust Co. in Greenwood.  Ravenel Boykin Curry III moved to New York and launched Eagle in 1988.

Boykin Curry IV holds an undergraduate degree in economics from Yale University and an MBA from Harvard Business School. He managed investments for Morgan Stanley Asset Management and hedge fund Kingdon Capital before joining his father at Eagle.Eagle has a solid record of outperforming the S&P 500. As of early 2014, it had a cumulative return since inception of 2,031%, versus 634% for the S&P 500.

FIGURE X  –13F Current Holdings as of 6/30/2015, Price as of 8/30/2015

Source: AlphaClone

FIGURE X – 13F Performance, 2000- 2014

Source: AlphaClone