Every quarter, many money managers have to disclose what they've bought and sold, via "13F" filings. Their latest moves can shine a bright light on smart stock picks.
Today, let's look at Columbia Wanger Asset Management. Founded in 1992, it's a subsidiary of Ameriprise Financial, managing mutual funds and serving investment companies, pension plans, and others. Its reportable stock portfolio totaled $22.8 billion in value as of June 30, 2013.
Interesting developments
So what does Columbia Wanger's latest quarterly 13F filing tell us? Here are a few interesting details:
The biggest new holdings are WuXi PharmaTech and Allscripts Healthcare Solutions (MDRX 1.01%). Allscripts delivers electronic health records (EHR) products and services and is getting a boost from Obamacare, which supports EHR systems. Its customer backlog tops $3 billion, but its second-quarter revenue and earnings were both below year-ago levels. Skeptics remember that not so long ago, the company tried to sell itself but was not bought and they question the value of EHR as well.
Among holdings in which Columbia Wanger Asset Management increased its stake was Windstream (WINMQ), with a dividend that has been yielding more than 11% lately! Its just-reported quarterly earnings offer reasons to worry about the payout's sustainability, with revenue down 2% over year-ago levels and net income down 22%. Still, management maintained the dividend -- for now. Windstream has been shifting its focus away from rural telecom service and toward broadband service and business customers, but it's also been losing customers (though its enterprise customer count grew by 6%). There's still reason to be hopeful (it sports positive free cash flow, for example), but the stock is heavily shorted.
Columbia Wanger Asset Management reduced its stake in lots of companies, including Silver Wheaton (WPM 0.15%) and Atmel (NASDAQ: ATML). Silver Wheaton's stock has been hurt by falling prices for precious metals. It has a most attractive business model, where instead of engaging in actual (and risky) mining, it simply buys the rights to income from mines in exchange for financing -- but it's not perfect, and the company has been burning cash. Meanwhile, its once-promising investment in a major Barrick Gold mine has run into trouble.
Atmel, which makes touchscreen controllers, recently posted second-quarter earnings featuring revenue down 6% over year-ago levels and EPS of $0.03, vs. $0.00 a year earlier. Management noted, "Our core microcontroller business generated strong growth in the second quarter and we further improved our competitive position with the launch of our new low-power ARM Cortex-M0+ product family." Bulls like its inclusion in some Galaxy devices, but weak sales of Microsoft's Windows 8 is not likely to give the company much of a boost.
Finally, Columbia Wanger's biggest closed positions included DENTSPLY International and Microsemi. Other closed positions of interest include Allied Nevada Gold (NYSEMKT: ANV). Allied Nevada has seen its shares plunge more than 80% over the past year, as the precious metals miner has, along with its peers, struggled with weak prices and high production costs. The stock recently tanked by more than 20% after second-quarter results disappointed investors (despite revenue being up 75%). Management also mentioned construction delays, and has stressed its efforts to cut costs.
We should never blindly copy any investor's moves, no matter how talented the investor. But it can be useful to keep an eye on what smart folks are doing. 13-F forms can be great places to find intriguing candidates for our portfolios.
