MAI Wealth Advisors, LLC, is a portfolio management and financial advisory company based in Cleveland, OH and is run by Gerald H. Gray, their Chief Investment Officer. The fund has recently filed their quarterly 13F report, which includes a massive addition to Avalon Rare Metals Inc (US listing) (NYSEMKT:AVL), while General Electric Company (NYSE:GE) has moved to the top of the holdings list.
Why pay attention?
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Let’s get started
The ball is opened by General Electric Company (NYSE:GE). MAI Wealth Advisors has increased their stake in the US giant by 35% to more than 600,000 shares. General Electric Company (NYSE:GE) stock is traded at a trailing Price to Earnings (P/E) ratio of 16.59, while the forward P/E ratio is 12.31. This implies the market expects the company to grow and increase its revenues and earnings. Analysts estimate earnings of $1.66 per share in 2013 and $1.82 per share in 2014. Revenue is also expected to grow by 0.9% in 2013 and 1.8% during the next year. GE has a beta of 1.40 and pays a dividend of $0.72, for a yield of just under 3.4%.
CIO Gerald Gray has added an enormous 200,000 shares to the fund’s holding of Avalon Rare Metals Inc (US listing) (NYSEMKT:AVL), taking it to a total of 430,900 shares. The stock price of the company has been falling ever since its top in April 2011. It has a beta of 3.64, which makes the stock a very risky one. Analysts estimate the revenues to grow 7.7% in 2013, but they expect the company to bleed money. On April 17, Avalon Rare Metals Inc (US listing) (NYSEMKT:AVL) announced the completion of a feasibility test for their “Nechalacho Rare Earth Elements” Project. According to the report, the Net Present Value of the project is $900 million after-tax, with revenues of $645.8 million per year and average operating costs of $264.5 million per year.
MAI has also bolstered their investment in Vodafone Group Plc (ADR) (NASDAQ:VOD), which made it their third biggest position with more than 430,000 shares. With a beta of 0.78 and a dividend of $1.53, the presence of Vodafone Group Plc (ADR) (NASDAQ:VOD) brings some stability to the portfolio, considering the risky investment in the aforementioned Avalon Rare Metals. The mobile technology provider is expected to register higher revenues in the coming years and has sported a price range of $21.00-$34.40. Two of the 4 analysts that monitor the stock recommend it as a Strong Buy, while one of them tags it as a Sell.
Gray’s fourth major position is Glencore International PLC, St. Helier (OTCMKTS:GLCNF) – a company engaged in the production and supply of commodities, namely metals and minerals, energy products and agricultural products. The company’s stock is traded at a trailing P/E ratio of 38.21 and has been in a down trend since the start of the year. On April 30 it was announced that the Chinese Ministry of Commerce has approved the merger of Glencore International PLC, St. Helier (OTCMKTS:GLCNF) with Xstrata Plc Adr (OTCMKTS:XSRAY).
A bit more mainstream
MAI Wealth Advisors’ fifth largest holding is a bit more mainstream: Microsoft Corporation(NASDAQ:MSFT). The investment team has added 13% to their stake in the tech giant. Microsoft Corporation (NASDAQ:MSFT) is currently trading at a trailing P/E ratio of 17.25 and has a forward P/E ratio of 10.89, signaling that Wall Street expects the software giant to thrive in the coming years.
The stock has already established a technical uptrend, gaining 22% in 2013. With Microsoft set to launch a new Xbox game console this year, in addition to their aggressive approach to gain more ground in the smartphone market, it’s easy to expect the stock to further appreciate.
Final thoughts
The main bets of MAI Wealth Advisors seem to resemble the Capital Asset Pricing Model. Gray has made some risky investments in stocks that are traded Over-The-Counter (OTC) and has tried to balance them by adding to the fund’s holdings in blue chips like Microsoft and General Electric.
You can compare this equity portfolio with those of other hedge funds, and also make sure you check out market-beating strategy. We reveal the details of this strategy in our premium section, and you can also download the free edition of our newsletter here.
Disclosure: none
