Superinvestor Ken Fisher has outperformed the stock market for 15 years. Each quarter, money managers like Fisher must disclose their stock moves, giving us a peek into their maneuvers. Many investors use this information to gain insight as to what stocks the pros are buying and selling.
Let's take a closer look at five stocks Fisher gave the heave-ho this past quarter.
Japanese industrial manufacturer Komatsu (NASDAQOTH:KMTUY) recently picked up market share in China by outcompeting rival Caterpillar on price. But Fisher probably dumped Komatsu stock based partly on the company's shrinking profits resulting from falling demand in Asian nations such as China and Indonesia .
Shares of Men's Wearhouse (NYSE:TLRD) surged in March after the retailer announced it'd sell its K&G unit, which sells men's suits and accessories. The company plans to focus on mobile, with apps enabling customers to order online tailoring and customize tux rentals. The company is also expanding its big-and-tall offerings, a growing (no pun intended) and underserved market. Roughly half of the company's online sales are attributed to big and tall. But Fisher still thought stock came up short and sold his entire position last quarter.
Texas-based industrial company McDermott International (NYSE:MDR) provides construction services to the offshore oil and gas industry. Shares of McDermott plunged in early March, when the company missed analysts' earnings estimates. Project delays and higher costs continue to hamper profitability. Fisher probably sold because of McDermott's weak outlook for 2013.
Fisher completely sold his position in mining company Cliffs Natural Resources (NYSE:CLF). The stock has a high short ratio of nearly 25%, signaling that the market is betting Cliffs will post lackluster results. Given its subpar financial performance in recent quarters, this isn't startling. And since the company cut its dividend, the stock has become much less desirable for income investors.
The hedge fund manager also dumped his stake in tech company Teradata (NYSE:TDC). In the first quarter of 2013, Teradata announced earnings per share slid 32%, attributed to lower revenue growth and higher investment costs. But Teradata is gaining new customers and expanding its contracts with existing ones, namely Kohl's and Groupon.
I don't own any of the stocks mentioned above that Fisher sold. While I agree with his decision to sell Komatsu, McDermott, and Cliffs, I'm not so sure about Men's Wearhouse and Teradata. As a patient, long-term investor, I think these companies still hold potential in their respective specialty retail and analytic data services markets.