Diamond Hill Second Quarter Conference Call

Diamond Hill Funds Second Quarter Conference Call is now available at their website.

For those of you unfamiliar with Diamond Hill, they are Graham and Dodd value investors, and clearly communicate that philosophy in all of their material, including incredible shareholder letters and quarterly conference calls. Diamond Hill runs funds and SMAs based on an in depth bottom up research approach looking for companies they can buy at a significant discount to intrinsic value.

Over the past three years Diamond Hill's Large Cap fund has returned 20.4% versus 12% for the Russell 1000 value, an especially impressive performance since Diamond Hill frequently holds large cash positions.

This quarter Portfolio Managers Ric Dillon and Chuck Bath reiterated their bullish views on energy based on Diamond Hill's bottom up research of companies in the sector. Dillon highlighted the fact that Diamond Hill's models predict significant excess returns for many energy companies over the next five years, even when a decline in the price of crude is built into the model.

Diamond Hill also discussed the fact that their funds are significantly underweight consumer discretionary stocks. They discussed the lack of homogeneity in the sector pointing out that both GM and Yahoo are grouped into the consumer discretionary sector. Bath reiterated their short of Yahoo in the Diamond Hill long short fund, a position that paid off last week when Yahoo shares declines over 20%.


Timothy Burger
timothyb(at)timothyburger.com