Longleaf Annual Meeting Notes:
The 5/8/02 meeting was an enjoyable conference. The meeting lasted about 1.5 hours with a .5 hour pre-conference drink/appetizer get together.
Some brief comments, as I just returned today, include the following:
1) the overall equity market is fairly -- if not overly -- priced. Stocks are priced at 78% of fair value within the Partners Fund (this is a high percentage in relative terms -- historically for the Partner Fund). The Partner Fund is about 20% cash.
2) the International Fund is the cheapest at the present time at 60% of fair value.
3) Longleaf management is looking at healthcare and some telcom/cable companies. (Management continues to like Comcast and is holding "T" waiting for the Comcast shares.) No names were provided as management is still looking at specific companies and industries.
4) management is not confortable with biotech firms due to the difficulty in evaluating product approval, lack of sales, and lack of profits.
Mr. Hawkins mentioned Dr. Graham 2-3 times, by name, during his discussion of investor questions. Longleaf management provided a little in background of the past year, but rather focused more so upon investor questions. Mr. Hawkins addressed a question about the market returning to a 14x multiple -- which has historically been the case & what kind of run this would have on mutual funds. Mr. Hawkins said that his firm is ready for any kind of market. Mr. Hawkins reflected upon the '74 timeframe when stocks were selling for below cash (quality companies with sales, profits, and proven management).
Bottom line: Mr. Hawkins & company feel that bargains are very difficult to find at the present time.
Free giveaways, for those interested, included hats, beverage holders, stress-free squeeze balls, extensive book on Longleaf Trees. |
