GoodHaven Capital Management’s Changing Fortunes: A Look at Their Q3 2022 vs. Q4 2022 13F Holdings Comparison

GoodHaven Capital Management, LLC recently released its Q4 2022 13F holdings report, and the changes in its holdings over the quarter are quite interesting. We take a closer look at how the fund has transitioned its portfolio between Q3 and Q4 and whether these changes bode well for the future.

Overview of the Q3 2022 and Q4 2022 13F Holdings

In the Q3 2022, GoodHaven held 25 stocks worth $124,928, while in the Q4 2022 filings, the numbers rose to 26 stocks worth $146,141. The most significant changes were observed in the top 5 holdings, and the ten holdings that were held in both quarters.

In Q3 2022, Berkshire Hathaway Inc. was the largest holding of GoodHaven, representing 37.8% of the total portfolio. In Q4 2022, Berksire Hathaway remained a significant holding, but its weight reduced to 19.18%, chased closely by Jefferies Financial Group Inc., which represented 10.63% of the portfolio. Alphabet Inc. was the third-largest holding in Q3, but its position fell to number four in Q4.

RH (16.1%), Brookfield Corp (13.5%), and Global Industrial Company (10.3%) were not part of the Q3 holdings but made it to the Q4 top 10 holdings. In contrast, Versizon experienced a significant change in position, dropping from number 7 in Q3 to number 10 in Q4.

Breaking down the top 5 holdings reveals that Berksire Hathaway and Jefferies Financial Group Inc. account for 29.8% of the total portfolio. In Q3, the top two holdings (Berksire Hathaway and Alphabet Inc.) accounted for 51.8% of the fund's total holdings, indicating that GoodHaven has diversified its holdings in Q4 2022.

Changes in GoodHaven’s Holdings in Q4 2022

The changes in GoodHaven's Q4 2022 13F filings offer several insights into the company's portfolio. The fund increased its stake in Berksire Hathaway Inc., adding 1500 shares or 1.65% of its Q3 holding. The increased holding is viewed as a bullish move, indicating GoodHaven's continued confidence in the company's long-term financial prospects.

Additionally, GoodHaven increased its stake in Jefferies Financial Group Inc. by adding 2172 shares or 0.48% of its Q3 holdings. Jefferies Financial Group is an American multinational investment bank and financial services company headquartered in New York City. Its wide range of financial products and services makes it an attractive standalone financial services company and a potential acquisition target, making GoodHaven's increased position in the company an interesting move.

However, GoodHaven reduced its stake in Alphabet Inc. by selling 1.73% or 2730 shares of its Q3 holding in the company. Despite the company's weak position in the portfolio, Alphabet remains the third-largest holding of GoodHaven, and its position in the fund's portfolio remains within acceptable ranges.

Brookfield Corporation is GoodHaven's fourth-largest holding after acquiring 73692 shares in Q4 2022. The management company is a global alternative asset manager with significant investments in real estate, renewable energy, infrastructure, private equity, and credit.

GoodHaven's Stake in Barrick Gold Corporation

GoodHaven's stake in Barrick Gold Corp. remained unchanged in Q4 2022, with the fund holding 173,280 shares in both quarters. Unlike the Q3 holdings, which were all stocks, the Q4 holdings included a call option with a strike price of CAD 28, which allows GoodHaven to buy Barrick Gold shares by paying a premium of CAD 28. The option expired unexercised in Q4 2022, indicating that GoodHaven did not anticipate a rise in Barrick Gold's stock price and hence did not make a profit from this particular trade.

Conclusion

The Q3 2022 vs. Q4 2022 13F holdings comparison reveals GoodHaven's bold moves to adjust its portfolio, indicative of its forward-looking investment approach. While diversification of holdings has been the most significant change, the company's increased stake in Jefferies Financial Group and Berksire Hathaway Inc. proves that they remain good investments with long-term positive prospects. The overall changes in the fund's holdings indicate that GoodHaven's management team remains confident and poised for a profitable future.