October 31, 20130 Comments

A Great Investor Turns More Conservative

Donald Yacktman, President and Founder of Yacktman Asset Management runs two five-star funds. Both have beaten the markets and their peers by wide margins over the years.  This past Morningstar Stock Fund Manager of the Year explains while his approach to picking stocks has stayed the same, his current strategy is changing.

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WEALTHTRACK Episode #1019; Originally Broadcast on November 01, 2013

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Donald Yacktman

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[wptabs mode=”horizontal”] [wptabtitle]Guest Info[/wptabtitle] [wptabcontent]DONALD YACKTMAN
Portfolio Manager
The Yacktman Fund[/wptabcontent] [wptabtitle] Newsletter[/wptabtitle] [wptabcontent]Consuelo MackBull or Bear? To taper, or not to taper? Despite the constant back and forth, the S&P 500 is up 160% from its 2009 12-year low. It’s been a near historic high for 5 years. Former Merrill Lynch strategist turned successful money manager, Richard Bernstein told a small audience this week that this could be the greatest bull market of our generation. Recent WEALTHTRACK guest and former Merrill chief economist David Rosenberg, who now hangs his hat at Gluskin Sheff’ as their chief  economist and strategist, has been getting flack for moving to a more bullish stance. For years he has been known for his prescient warnings about serious economic and market risks. He explained his shift to us on WEALTHTRACK three weeks ago. The Wall Street Journal recently covered the back lash he has gotten from some of his followers in its article “Top Bear’s Bullish Tilt Has Followers Growling.” 

Bernstein and Rosenberg are not alone in seeing strength where there was once weakness. Another highly respected economist and strategist Ed Yardeni recently wrote about a possible market melt-up. Yardeni pointed out that in recent weeks, “The stock market continues to make new record highs, led by stocks with above-average P/E’s.” If you look at market performance year-to-date, there is a big  difference among small, mid-sized and large company stocks. Small cap stocks have outdistanced midcap and both have raced ahead of large cap. Yardeni also notes that the pattern of outperformance among smaller company stocks is fairly uniform across different sectors and industries whether its energy, health care or consumer staple stocks.

This week’s WEALTHTRACK guest is tracking these developments and paying particular attention to the divergence in performance. He is value investor Donald Yacktman,  President and founder of Yacktman Asset Management and co-portfolio manager of the 20-plus year old Yacktman Fund and the younger Yacktman Focused Fund. Both are rated five-star by Morningstar and have beaten the markets and their peers by wide margins over the years. Yacktman is also a past Morningstar Stock Fund Manager of the Year award winner and a finalist for Morningstar Stock Fund Manager of the Decade.

The last time I interviewed him in January of 2012, he described the values in the market as “amazing.” After the big run up since then he has turned more cautious and is making some changes.

We were delighted to have taped another episode of WEALTHTRACK at the Museum of American Finance, located at 48 Wall Street. It is a must-visit destination for those interested in the amazing financial history of this country and the foundation of our phenomenal economic success.

Have a great weekend and make the week ahead a profitable and a productive one.

Best regards,

Mathews Asia[/wptabcontent] [wptabtitle]Action Point[/wptabtitle] [wptabcontent]


Located at 48 Wall Street, the Museum features a collection of historic documents, including bonds signed by George Washington and other founding fathers

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Coca-Cola Co. (KO)
Price: $39.62 on 10/30/13
52-week range: $35.58 – $43.43
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[/wptabcontent] [wptabtitle]Transcript[/wptabtitle] [wptabcontent]This transcript will be available soon. More information regarding WEALTHTRACK transcripts can be found here.
[/wptabcontent] [wptabtitle]Stock Mentions[/wptabtitle] [wptabcontent] Coca-Cola Co. (KO)
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News Corporation (NWSA)
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Viacom Inc. Class B (VIAB)
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Procter & Gamble Co. (PG)
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Microsoft Corporation (MSFT)
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Oracle Corporation (ORCL)
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PepsiCo Inc. (PEP)
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[/wptabcontent] [/wptabs] WEB EXTRA: All In The Family 
Yacktman, the legendary founder of the 5 star rated Yacktman and Yacktman Focused Funds recently promoted a long time co-portfolio manager of both funds to his former Chief Investment Officer role. The portfolio manager just happens to be his son Stephen who has been with the firm for 20 years.
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Donald Yacktman from the Archives

January 27, 2012
Great Investor Don Yacktman, founder and co-manager of the Yacktman Fund tells us how he continues to beat the overall stock market landing in the top one percent of all large cap mutual funds over the past one, three, five and ten year periods. Such outstanding performance was recently recognized by Morningstar, the mutual fund rating firm, that nominated Yacktman for Domestic Manager of 2011.
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June 18, 2010
Don Yacktman explains how his penny pinching ways have translated into exceptional long-term returns for investors in his five star Yacktman Funds.

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