On July 18, 2023, Saba Capital Management, L.P. (Trades, Portfolio), a renowned investment firm, added 45499 shares of ClearBridge Energy MLP Total Return Fund (CTR, Financial) to its portfolio. This article provides an in-depth analysis of this transaction, the guru's profile, and the traded company's basic information.
Details of the Transaction
Saba Capital Management, L.P. (Trades, Portfolio) purchased 45499 shares of ClearBridge Energy MLP Total Return Fund at a price of $32.13 per share. This transaction increased the guru's holdings in the company by 5.11%, making a 0.03% impact on their portfolio. After this transaction, Saba Capital Management, L.P. (Trades, Portfolio) holds a total of 935,323 shares in ClearBridge Energy MLP Total Return Fund, representing 0.57% of their portfolio and 13.52% of the company's total shares.
Profile of the Guru
Saba Capital Management, L.P. (Trades, Portfolio), located at 405 Lexington Avenue, New York, NY 10174, is a prominent investment firm with a diverse portfolio. The firm currently holds 762 stocks, with a total equity of $5.24 billion. Its top holdings include Templeton Global Income Fund (GIM, Financial), BlackRock Capital Allocation Trust (BCAT, Financial), BlackRock Health Sciences Trust II (BMEZ, Financial), BlackRock Innovation & Growth Tr (BIGZ, Financial), and BlackRock ESG Capital Allocation Trust (ECAT, Financial). The firm's preferred sectors are Financial Services and Technology.
Overview of the Traded Company
ClearBridge Energy MLP Total Return Fund (CTR, Financial) is a non-diversified, closed-end management investment company based in the United States. The company operates in a single segment and aims to provide a high level of total return consisting of cash distributions and capital appreciation. As of July 20, 2023, the company has a market capitalization of $226.346 million and a stock price of $32.7097.
Analysis of the Traded Stock
ClearBridge Energy MLP Total Return Fund's stock has a PE percentage of 2.89. Since the transaction, the stock has gained 1.8%, and its year-to-date price change ratio is 18.9%. However, the stock has lost 67.69% since its Initial Public Offering (IPO). The stock's GF Score is 38/100, indicating poor future performance potential. The stock ranks 3/10 in balance sheet, 2/10 in profitability, 0/10 in growth, and 0/10 in GF value. However, it ranks 10/10 in momentum.
Financial Health of the Traded Company
ClearBridge Energy MLP Total Return Fund has an F score of 4 and a Z score of 0.00, indicating potential financial distress. The company's cash to debt ratio is also 0.00. However, the company has a high return on equity (ROE) of 32.62 and a return on assets (ROA) of 23.49, ranking 90 and 69, respectively. Unfortunately, the company has not shown any growth in gross margin, operating margin, revenue, EBITDA, or earnings in the past three years.
Stock's Performance Indicators
The stock's RSI 5-day, 9-day, and 14-day values are 72.46, 68.54, and 65.92, respectively. The stock's momentum index for 6-1 month and 12-1 month are 2.35 and 12.18, respectively. The stock ranks 1452 in terms of RSI 14-day and 366 in terms of momentum index 6-1 month.
Conclusion
In conclusion, Saba Capital Management, L.P. (Trades, Portfolio)'s recent acquisition of ClearBridge Energy MLP Total Return Fund shares indicates a strategic move to capitalize on the company's potential. Despite the company's poor growth and financial health indicators, its high ROE and ROA, coupled with the stock's strong momentum, may offer potential returns for value investors. However, investors should exercise caution due to the stock's poor GF Score and potential financial distress.
