John Rogers (Trades, Portfolio), the founder of Ariel Investment, LLC, recently increased his stake in Leslies Inc (LESL, Financial) by acquiring 8,153,363 shares. The transaction, which took place on July 31, 2023, has significantly impacted Rogers' portfolio, with the position in Leslies Inc now accounting for 1.22% of his total holdings. This article provides an in-depth analysis of the transaction, the guru's investment strategy, and the traded company's financial health and growth potential.
Profile of Guru John Rogers (Trades, Portfolio)
John Rogers (Trades, Portfolio) established Ariel Investment, LLC in 1983 and has since been managing the firm's small and mid-cap institutional portfolios. Rogers is also a long-term Forbes columnist, penning the "Patient Investor" column. His investment philosophy revolves around the selection of small and medium-sized companies that are undervalued. Rogers believes in patience, independent thinking, and a long-term outlook for achieving good returns. His top holdings include Baidu Inc (BIDU, Financial), Mattel Inc (MAT, Financial), Kennametal Inc (KMT, Financial), Philip Morris International Inc (PM, Financial), and Resideo Technologies Inc (REZI, Financial). As of the date of this article, Rogers' equity stands at $10.41 billion, with a strong focus on the Consumer Cyclical and Financial Services sectors.
Details of the Transaction
The transaction saw Rogers add 8,153,363 shares of Leslies Inc to his portfolio at a trade price of $6.37 per share. This addition increased his total holdings in the company to 20,000,131 shares, representing 10.90% of the company's total shares. The transaction had a 0.5% impact on Rogers' portfolio, further solidifying his position in the company.
Overview of Leslies Inc
Leslies Inc is a leading direct-to-consumer pool and spa care brand in the United States. The company offers a comprehensive assortment of products across chemicals, equipment and parts, cleaning and maintenance equipment, and safety, recreational, and fitness-related products. Since its IPO on October 29, 2020, the company's stock has experienced a -66.09% change, with a year-to-date change of -42.78%. As of the date of this article, the company's market capitalization stands at $1.29 billion, with a stock price of $7.01.
Leslies Inc's financial health and profitability potential are reflected in its GF Score of 37/100, Balance Sheet Rank of 3/10 and Profitability Rank of 6/10. Despite this, the stock does not have enough data to compute a Growth Rank. Additionally, the company's Altman Z score of 2.21 and Piotroski F-Score of 3 further indicate its low financial stability and profitability.
Analysis of the Stock's Valuation
Although the stock's price to GF Value is 0.31, Leslies Inc's stock is considered a possible value trap based on the company's poor Piotroski F-score. This suggests that investors should think twice before investing. Since its IPO, the stock has experienced a -66.09% change, with a year-to-date change of -42.78%.
Comparison with Other Gurus
Other gurus, such as Jefferies Group (Trades, Portfolio), also hold shares in Leslies Inc. However, Rogers' stake in the company is significantly larger, further solidifying his position in the company.
Conclusion
In conclusion, John Rogers (Trades, Portfolio)' recent acquisition of shares in Leslies Inc is a significant move that has greatly impacted his portfolio. Despite the company's current undervaluation and potential as a value trap, Rogers' investment philosophy and long-term outlook may prove beneficial in the long run. As always, investors are advised to conduct their own research and analysis before making investment decisions.
