Yahoo Finance Matthews Pacific Tiger Fund Adds 2 New Stocks to Portfolio
The Matthews Pacific Tiger Fund (Trades, Portfolio) added two new stocks to the portfolio, while divesting two others during the first quarter of 2015, according to GuruFocus Real Time Picks.
The fund invests in developed, emerging, and frontier markets in Asia, excluding Japan, which Matthews devotes a separate fund to. During the quarter, Matthews Pacific Tiger returned 7.53%, outperforming its benchmark MSCI All Country Asia ex Japan Index, which returned 4.9%.
In the Q1 fund commentary, the fund managers wrote that the outperformance during the quarter could be attributed to favorable stock selections in South Korea and Singapore. On the other hand, Indonesia and Taiwan were the largest detractors.
New buys
AIA Group (HKSE:01299)
The fund's largest purchase was 16,545,200 shares of AIA Group for an average price of HK$45.71 per share. The company is a life insurance based financial services provider that operates in 17 jurisdictions across the Asia-Pacific region.
Over the past year, the stock has risen 37% and currently trades at HK$50.55 with a P/E ratio of 22.7 and P/S ratio of 3.11.
Net income has been increasing steadily since 2011, and recorded at HK$26,884 million in 2014. The graph below shows the net income trend over time.
The current dividend yield is 0.87%, while the payout ratio is 20%.
WuXi PharmaTech Inc (WX)
The fund's other new buy of the quarter was 2,243,158 shares of WuXi PharmaTech for an average price of $38.52 per share. The new holding has a 1% portfolio weighting.
WuXi is a pharmaceutical, biotechnology, and medical device research and development company, with operations in China and the U.S.
Net income marginally decreased in 2014 to $112.2 million, down from $114.6 million the year before.
Over the past five years, the operating margin has declined by 7.53%, and recorded at 15.38% in 2014. However, the margin is still above the industry average of 3.8%.
Sold out
Keppel Land (K17.SI)
The fund sold all 34,212,000 of its shares in Keppel Land for an average price of S$4.30 per share. Keppel Land is the property arm of the Keppel Group. The company develops residential properties and townships in Singapore, China, Indonesia, Vietnam, and India.
In the Q1 commentary, the fund managers wrote that Keppel is being privatized by its parent company at a significant premium, which caused the fund to tender its shares.
Over the past year, the stock price has increased 28%, and now trades at S$4.45. According to the Peter Lynch chart, the stock is undervalued.
The company's EBIT per share has increased every year since 2011, recording at S$0.31 in 2014. The graph below shows the earnings trend.
Digital China Holdings (HKSE:00861)
The fund also sold its stake in Digital China Holdings, selling 33,948,000 shares at an average price of HK$7.41 per share.
Digital China offers integrated IT services, and also sells notebook computers, networking products, and IT planning. The stock has risen 59% over the past year and now trades at HK$11.18 with a P/E ratio of 17.8 and P/S ratio of 0.18.
In 2014, net income recorded at HK$902 million, down from HK$1,339 million the year before. However, over the past five years, net income has grown by almost 13%.
The current dividend yield is 1.53%, which is close to the three-year low, while the payout ratio is 27%.
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This article first appeared on GuruFocus.
