Mohnish Pabrai's latest investing stock portfolio

Pabrai Investment Fund(PIF2) for past six months has been down a whopping 35%. However his annualized returns since inceptions (Oct 2000) is 14.8% which is a good record. Here is the SEC filing as of Sept 30 submitted Nov 14, 2008

Quarterly comparisons

Air Transport Services, Inc (ATSG, virtually unchanged)
Dec 31: 5,517,678 shares
Mar 31: 5,592,678
June 30: 5,590,278 (value: $5 million)
Sept 30: 5,590,278 (value: $4 million)
He's gotten crushed with this stock going from $7 to 16 cents!

Berkshire Hathaway A (BRK-A, unchanged)
Dec 31: 1
Mar 31: 16
Sept 30: 16 (value: $2 million)

Berkshire Hathaway B(BRK-B, reduced)
Mar 31: 288 shares
June 30: 5179 (value: $20 million)
Sept 30: 4096 (value: $18 million)

CompuCredit (CCRT,virtually unchanged)
Dec 31:362,001
Mar 31: 2,065,997
Sept 30: 2,066,997 (value: $8 million)

Crypotologic (CRYP, unchanged)
Mar 31:1,483,694
June 30: 1,114,207 (value: $16 million)
Sept 30: 1,114,207 (value: $6 million)

Harvest Natural Resources (HNR, no change)
Sept 30: 5,712,701 (value: $57 million)

Jackson Hewitt Tax Services (JTX, reduced)
June 30: 629,884 (value: $7.6 million)
Sept 30: 114,096 (value: $1.7 million)

MDC Holdings (MDC, reduced)
Mar 31: 140,901
June 30: 18,701 (value: $730 thousand)
Sept 30: 18,201 (value: $666 thousand)

Pinnacle Airlines (PNCL, reduced)
Dec 31: 3,244,902
Mar 31: 3,268,602 (value: $10 million)
Sept 30: 2,774,973 (value: $11 million)
He's got call options on this one.

Sears Holding (SHLD, reduced)
Dec 31:516,210
Mar 31: 588,407
June 30: 517,608 (value: $38 million)
Sept 30: 514,111 (value: $48 million)
Parbai also has call options on SHLD.

Ternium S.A (TX, unchanged)
Dec 31: 1,875,844
Mar 31: 1,797,644
June 30: 1,778,944 (value: $74 million)
Sept 30: 1,778,944 (value: $31 million)

Wellcare Health Plans Inc. (WCG, increased)
Mar 31: 297,179
June 30: 537,100 ($19 million)
Sept 30: 818,330 ($29 million)
He's got put options as well as a must be a hedge.

Non Common Stocks

Fairfax Financial Holdings -SUB VTG (reduced)
Dec 31:314,165
Mar 31: 310, 516
June 30: 309,801 (value: $78 million)
Sept 30: 308,798 (value: $101 million)


Semi annual report letter highlights.
"As I write this letter, we have positions trading below cash (the underlying businesses are free)...

Our assets under management are valued by Mr. Market at about $400 Million as of 9/30/08. I believe they are conservatively worth well over $900 Million....

The assets we own are changing hands at 40-odd cents on the dollar in aggregate....

If you had asked me a year ago what were the odds that we would see:

• Bear Stearns effectively go bankrupt and get bailed out by the Fed.
• Fannie Mae and Freddie Mac effectively get nationalized.
• Lehman Brothers declare bankruptcy.
• Merrill Lynch get sold to Bank of America to avoid a fate like Lehman.
• Washington Mutual Fail – the largest bank failure in US History.
• Runs on banks like Wachovia and WaMu.
• Treasuries go to negative yields. (this is worse than putting it under the mattress).
• GE and Goldman Sachs seek to bolster their reputations and balance sheets with capital from Warren Buffett on loan-shark type terms.
• Morgan Stanley contemplate a merger with Wachovia to bolster confidence – until there is a run on Wachovia - and Wachovia is quickly sold to Wells Fargo at a fire-sale price.

I would have guessed any one of the above could happen, but that it was a low probability. We saw all of the above (except Bear Stearns) unfold in just a few weeks in September ’08. I would have placed the odds of all of the above taking place in a few weeks in 2008 at pretty much zero. We are living through events that have never happened before and are unlikely to happen again in any of our lifetimes.....

Equity markets are forward looking creatures. Historically, equities start falling well before recessions get underway (as we’ve seen in the last year) and start recovering well before recessions are over. So, this latest recession could last two years and equities could start moving up dramatically in a year or less....."

How Mohnish Pabrai is weathering the storm

Eddie Lampert's lastest investing portfolio

Billionaire investor and Sears Holdings Corp. Chairman Edward Lampert

As of Sept 30 issued Nov 14, 2008, comprehensive quarterly comparisons under RBS Partners LP and .

Acxiom (ACXM, no change)
June 30: 3,293,989 shares (value: $37 million)
Sept 30: 3,293,989 shares (value: $41 million)

AutoNation (AN, increased)
Dec 31: 58,526,358
Mar 31: 66,624,115
June 30: 72,024,268 (value: $721 million)
Sept 30: 77,763,550 (value: $874 million, price ranged $7.57 - $13.32)
Eddie bought another 529,300 shares at an average price of $5.99 apiece on Nov 11 and 12 according to a regulatory filing.

AutoZone (AZO, unchanged)
Mar 31: 22,006,790
June 30: 22,884692 (value: $2.7 billion)
Sept 30: 22,884,692 (value: $2.8 billion)

Capital One (COF, new position)
Sept 30: 9,628,591, (value: $365 million, price range : $33.75-56.05)

CIT Group (CIT, no change)
June 30: 3,925,000 (Value: $26 million)
Sept 30: 7,269,321(value: $50 million, price range: $6.15 - $11.48)

Citigroup Inc (C, no change)
June 30: 19,083,800 (value: $319 million)
Sept 30: 19,083,800 (value: $319 million)

Centex Corp (CTX, unchanged)
Mar 31: 747,500
June 30: 608,100 (value: $8 million)
Sept 30: 608,100 (value: $9 million)

Federal National Mortgage Association (Fannie Mae, new position)
Sept 30: 34,586,789 (value: $52 million)
This could be a write off because the US government took control of the company after a wave of mortgage defaults.

Home Depot (HD, unchanged)
Dec 31:16,685,679
Mar 31: 22,762,646
June 30: 19,715,300 (value: $461 million)
Sept 30: 19,715,300 (value: $510 million)

The Hartford Financial Services Group, Inc. (HIG, new position)
Sept 30: 550,000 (value: $22 million, price range $40-$64)
The stock has tanked after Sept 30 to $12!

KB Home (KBH, unchanged)
Mar 31: 605,000
June 30: 358,000 (value: $6 million)
Sept 30: 358,000 (value: $7 million)

PHH Corp (PHH, no change)
June 30: 1,430,068 (value: $21 million)
Sept 30: 1,430,800 (value: $18 million)

Sears Holdings (SHLD, increased)
June 30: 65,639,184 (value: $4.8 billion)
Sept 30: 66,020,086 (value: $6.1 billion, price range $74-$94)
The stock lowest ever today at $38!

SLM Corp (SLM, no change)
June 30: 6,018,100 (value: $116 million)
Sept 30: 6,018,100 (value: $74 million)

June 30 Grand Total Market Value : $9.3 billion
Sept 30 Grand Total Market Value : $11.5 billion

Warren Buffett's Current Stock Portfolio

Here is the latest quarterly filing of billionaire investor Warren Buffett's Berkshire Hathaway Inc. ended Sept 30, submitted Nov 14, 2008

Here's a comparison of stock shares quarter to quarter:

American Express Co. (AXP, no change)
June 30: 151,610,700 (value: $5.7 billion)
Sept 30: 151,610,700(value: $5.3 billion)

I would be very surprised if he did not add to AXP in the next quarter because price of AXP has dropped significantly to under $20.00

Anheuser Busch Cos. Inc. (BUD, reduced)
Mar 31: 35,563,200
June 30: 13,845,000 (value: $860 million)
Sept 30: 13,845,000 (value: $898 million)

Bank of America Corp. (BAC, reduced)
June 30: 9,100,000 (value: $217 million)
Sept 30: 5,000,000 (value: $175 million)

Burlington Northern Santa Fe (BNI, no change)
Dec 31: 60,828,818
Mar 31: 63,785,418
June 30: 63,785,418 (value: $6.3 billion)
Sept 30: 63,785,418 (value: $5.8 billion)

Although BNI looks the same, it was reported Buffett did add more to this position at $79.65.

Carmax Inc. (KMX, reduced)
Dec 31: 21,000,000
Mar 31: 21,300,000
June 30: 21,300,000 (value: $302 million)
Sept 30: 18,444,100 (value $258 million)

Believed to be a Lou Simpson(GEICO) pick than from Warren.

Coca Cola (KO, no change)
June 30: 200,000,000 (value: $10.4 billion)
Sept 30: 200,000,000 (value: $10.5 billion)

Comcast Corp CLA (no change)
June 30: 12,000,000 (value: $225 million)
Sept 30: 12,000,000 (value: $236 million)

Comdisco Holding Co. (no change)
Mar 31: 1,537,866 (value $14 million)
Sept 30: 1,538,377 (value $14 million)

ConocoPhillips (increased)
Mar 31: 17,508,700
June 30: none
Sept 30: 83,955,800 (value: $6.15 billion, price range $68.31-$90.75)

It's a major bargain now that COP is under $50!!

Costco Wholesale Corp. (no change)
June 30: 5,254,000 (value: $368 million)
Sept 30: 5,254,000 (value: $341 million)

Eaton Corp (ETN, new position)
Sept 30: 2,908,700 (value: $163 million, price range $56-84)

Currently $41.15.

Gannett Inc. (GCI, no change)
June 30: 3,447,600 (value: $74 million)
Sept 30: 3,447,600 (value: $58 million)

General Electric Co. (GE, no change)
June 30: 7,777,900 (value: $207 million)
Sept 30: 7,777,900 (value: $198 million)

Warren also bought $3 billion worth of preferred shares with the option to buy common at $22.25 over 5 years. He also bought $5 billion worth of preferred Goldman Sachs with warrants which are exercisable at common stock price of $115.

Glaxosmithkline (GSK, no change)
June 30: 1,510,500 (value: $66 million)
Sept 30: 1,510,500 (value: $65 million)

Home Depot Inc. (HD, reduced)
June 30: 4,181,000 (value: $97 million)
Sept 30: 3,700,000 (value: $95 million)

Ingersoll-Rd Company LTD. (IR, no change)
Dec 31: 636,600
Mar 31: 936,600
June 30: 5,636,600 (value: $210 million)
Sept 30: 5,636,600 (value: $175 million)

Iron Mountain Inc. (IRM, no change)
Dec 31: 4,663,900
Mar 31: 3,372,200
June 30: 3,372,200 (value: $89 million)
Sept 30: 3,372,200 (value: $82 million)

Johnson & Johnson (JNJ, no change)
June 30: 61,754,448 (value: $3.9 billion)
Sept 30: 61,754,448 (value: $4.2 billion)

Kraft (KFT, no change)
Dec 31: 132,393,800
Mar 31: 138,272,500
June 30: 138,272,500 (value: $3.9 billion)
Sept 30: 138,272,500 (value: $4.5 billion)

Lowes Companies Inc. (LOW, no change)
June 30: 7,000,000 (value: $145 million)
Sept 30: 6,500,000 (value: $153 million)

M & T Bank Corporation (MTB, no change)
June 30: 6,708,760 (value: $473 million)
Sept 30: 6,715,060 (value: $599 million)

Moody's (MCO, no change)
June 30: 48,000,000 (value: $1.6 billion)
Sept 30: 48,000,000 (value: $1.6 billion)

NRG Energy (NRG, increased)
June 30: 3,238,100 (value: $138 million)
Sept 30: 5,000,000 (value: $123 million, price range $23-$43)

NRG Energy, Inc. operates as a wholesale power generation company primarily in the United States. Current price is $22.65.

Nike Inc. (NKE, no change)
June 30: 7,641,000 (value: $455 million)
Sept 30: 7,641,000 (value: $535 million)

Norfolk Southern Corp. (NSC, no change)
June 30: 1,933,000 (value: $121 million)
Sept 30: 1,933,000 (value: $127 million)

Procter & Gamble Co. (PG, no change)
June 30: 105,847,000 (value: $6.4 billion)
Sept 30: 105,847,000 (value: $7.3 billion)

Sanofi Aventis (SNY, no change)
Mar 31: 3,586,733
June 30: 3,903,933 (value: $129 million)
Sept 30: 3,903,933 (value: $128 million)

Sun Trusts Banks Inc. (STI, no change)
June 30: 3,204,600 (value: $116 million)
Sept 30: 3,204,600 (value: $105 million)

Torchmark Corp. (TMK, no change)
June 30: 2,823,879 (value: $165 million)
Sept 30: 2,823,879 (value: $ $168 million)

US Bancorp (USB, increased)
Dec 31: 67,581,926
Mar 31: 68,631,026
June 30: 68,631,026 (value: $1.9 billion)
Sept 30: 72,937,126 (value: $2.6 billion, price range 22.70-$35)

USG Corporation (USG, no change)
June 30: 17,072,192 (value: $504 million)
Sept 30: 17,072,192 (value: $437 million)

Union Pacific Corp. (UNP, no change)
Mar 31: 4,453,000
June 30: 8,906,000 (value: $672 million)
Sept 30: 8,906,000 (value: $633 million)

United Parcel Service Inc. (UPS, no change)
June 30: 1,429,200 (value: $87 million)
Sept 30: 1,429,200 (value: $89 million)

United Health Group Inc. (UNH, reduced)
Dec 31: 6,000,000
Mar 31: 6,400,000
June 30: 6,400,000 (value: $168 million)
Sept 30: 6,379,900 (value $161 million)

Wabco Holdings Inc. (WBC, no change)
June 30: 2,700,000 (value: $125 million)
Sept 30: 2,700,000 (value: $95 million)

Wal-Mart Stores, Inc. (WMT, No change)
June 30: 19,944,300 (value: $1.1 billion)
Sept 30: 19,944,300 (value: $1.1 billion)

Washington Post Co. (WPO, no change)
June 30: 1,727,765 (value: $1 billion)
Sept 30: 1,727,765 (value: $961 million)

Wells Fargo & Co. (WFC, reduced)
Dec 31: 289,259,868
Mar 31: 290,654,868
June 30: 290,654,868 (value: $6.9 billion)
Sept 30: 290,407,668 (value: $10.8 billion)

Wellpoint Inc. (WLP, reduced)
Dec 31: 4,500,000
Mar 31: 4,800,000
June 30: 4,800,000 (value: $228 million)
Sept 30: 4,777,300 (value: $223 million)

Wesco Finl Corp. (No change)
June 30: 5,703,087 (value: $2.1 billion)
Sept 30: 5,703,087 (value: $2 billion)

June 30 Grand Total: $57.8 billion.
Sept 30 Grand Total: $69 billion.

Wellcare (WCG) takes a nose dive and drops 50%

Wellcare Health (WCG) drops to $9.10. Shares plunged to all-time lows Thursday after the health insurer, already the target of multiple state and federal investigations, said it is in default on some debt covenants and is being hurt by higher Medicare costs.

That is not good news to value investors Mohnish Pabrai and Bruce Berkowitz who own sizable positions and bought them in the 20's and 40's.

Actual shorting of Berkshire Hathaway.

Shares of Warren Buffett's Berkshire Hathaway have closed at a two-year low.The Class A stock fell 3.2 percent to finish the day (Wednesday) at $103,333 each.

Some traders are shorting the stock because of Buffett is betting that the stock market will go up.

'Based on (equity and) equity index prices as of October 31st (2008) applied to Berkshire's investment holdings and its equity index put option contracts, Berkshire estimates (that) consolidated shareholders' equity would decline by approximately nine billion dollars.'

Because it had a 40 billion dollar short index put position on. That means, actually, that he was betting on the market going up. Bullish, was Mr. Buffett on the market.

-Stock Article Link

Insider buying at Citigroup (C)

Chief Executive Vikram Pandit acquired roughly 750,000 shares of the firm's common stock Citigroup(C) at prices between $8.92 and $9.45 (about $6.7 million), according to a filing with the Securities & Exchange Commission. -Stock Article Link

Learn to think like Warren Buffett.

In just a two-week span, Buffett picked up Constellation Energy for the relative bargain price of $4.7 billion. He bought $5 billion in preferred stock from Goldman Sachs, receiving a fat 10% yield. And he purchased $3 billion in preferred shares of GE, also yielding 10%.

This doesn't mean Buffett is saying go out and buy Goldman or GE stock. In fact, there are plenty of reasons why you shouldn't try to follow his lead, not the least of which is the fact that Berkshire gets deals that individuals simply can't.

But that's not the point. The opportunity here is to pick up some valuable investing wisdom from the greatest practitioner alive. In this spirit, here's what I think you can learn from Buffett's moves:

Be greedy when others are fearful-Stock Article Link

Li Ka-Shing's Cheung Kong stock (CHEUY) is a buy.

Li Ka-Shing is considered the Warren Buffett of Asia and with his stock conglomerate down to it's lows (trading at $8.50 on the OTC), it's time to pick up some shares. Based in Hong Kong, the Cheung Kong Group's businesses encompass such diverse areas as property development and investment, real estate agency and estate management, hotels, telecommunications and e-commerce, finance and investments, retail, ports and related services, energy, infrastructure projects and materials, media, and biotechnology.

Cheung Kong Website

In Hong Kong, it trades at $66.00 (0001.hk) yet last year it earned $11.95. It if was a bond, that's an 18% interest. It probably won't earn that much next year but even half that is 9% interest plus you get 3.7% dividend. -Financial Highlights

Lenny Dykstra 80-0 and making $200,000 since March.

It really sounds to good to be true when Lenny Dykstra claims to be 80-0 record with his deep in the money option calls strategy. He bails out for a profit when he makes $1000 on each trade. His record is amazing considering the market has turned south. I got to pay more attention to his picks. I'm wondering if anyone has subscribed to his letter and had the same type of success. He says it's scalable, so if you don't have a lot of money, you can go for $100 wins on each trade. -Stock Article Link

Here is his Nails on the Numbers 14 day free trial link, annual subscription is $999.95. Wow!! The more than Cramer's Action Alerts Plus for $349.95.

Bullish comments for Arcelor Mittal (MT)

"Lakshmi Mittal has engineered the greatest transformation of the global steel industry since the era of Bessemer, Carnegie and Thyssen....

MT plunged from 104 to 20 in only six months as recession led to a softening of steel demand for construction, industrial uses and automobile manufacturing.....

Arcelor Mittal announced a production cut of 35 per cent to exert volume discipline as the global steel market faces an inventory glut....

steel will still anchor the industrialisation of the emerging markets, particularly Russia, India, China, Brazil and the GCC. The emerging markets per capita consumption of steel will only rise in the decade ahead and Lakshmi Mittal is all about the emerging markets, with his Indian roots and turnaround successes in Indonesia and Kazakhistan......

Government infrastructure spending could also replace IT as the growth business of the next decade, from Beijing to Washington. Both trends are naturally bullish for Arcelor Mittal. " -Stock Article Link


MT stock is in the low $20's and the book value is $45 with a dividend yield above 5%+. It will still be a profitable company next year so with such a low valuation, that is your margin of safety.

MSFT earnings on Tuesday.

It's amazing to me that Microsoft (MSFT) is hovering around $21.00. With zero debt and it's huge cash reserves, and a gigantic buyback plan in the works.....this stock is a no brainer buy even ahead of it's Tuesday earnings call. It's a tech company with p/e of 11 and a forward p/e of 9? The ratios of return on equity and margins have only increased over the years. Check it out.

I'm glad Steve Ballmer has rejected Yahoo and moved on. If you look at Yahoo's financial fundamentals ratios, they are terrible. Although Microsoft has lost the search race against Google, it is still the king of the operating system with a 90% market share. Not to mention it's Office Suite of Word, Powerpoint, etc is used by 400 million users! It generates about $1 billion of free cash flow every month according to Standard & Poors. It's a cash cow toll bridge and won't be going away anytime soon unless an iPhone can replace a laptop or desktop.

Berkshire reports 77 percent drop in 3Q earnings

"Warren Buffett's Berkshire Hathaway Inc. on Friday reported a 77 percent drop in third-quarter earnings, hurt by declining insurance profits and a $1.01 billion investment loss....

Berkshire and Buffett have made several deals over the past two months that will make use of some of that cash, but most of the big investments, including a $5 billion infusion in Goldman Sachs and a $3 billion stake in General Electric, weren't completed until October. Therefore, those deals aren't reflected in this quarter's results."-Stock Article Link