Sean Stannard-Stockton - Ensemble Capital Management, Llc Portfolio Q3'2024: Top Holdings & Recent Changes
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Sean Stannard-Stockton of Ensemble Capital Management continues to exemplify disciplined long-term investing through precise portfolio management. His Q3 2024 $1.2B portfolio shows widespread reductions across core holdings, signaling a cautious approach amid market highs while maintaining focus on high-quality compounders.
Portfolio Overview: Concentrated Quality with Disciplined Adjustments
Portfolio Highlights (Q3 2024): - Market Value: $1,179.3M - Top 10 Holdings: 66.5% - Portfolio Size: 22 -2 - Average Holding Period: 25 quarters - Turnover: 9.1%
Ensemble Capital's $1.2B portfolio remains highly concentrated, with the top 10 positions commanding 66.5% of assets—a hallmark of Sean Stannard-Stockton's strategy favoring deep research on a select group of exceptional businesses. The reduction in portfolio size to 22 positions -2 alongside low 9.1% turnover underscores a patient, low-activity approach, where changes are deliberate rather than reactive.
This structure reflects a focus on durable competitive advantages, or "moats," in consumer, financial, and technology sectors. The impressive 25-quarter average holding period—over six years—demonstrates conviction in quality names, even as recent trims suggest profit-taking or risk management in an elevated market. Tracking via the Ensemble Capital superinvestor page reveals consistent emphasis on scalable, cash-generative companies.
Top Holdings: Widespread Reductions Across Consumer and Tech Leaders
The portfolio features systematic reductions across nearly all major positions, starting with The Home Depot (HD) at 8.3% after a 17.51% cut, followed by Mastercard (MA) at 8.0% with a 13.97% reduction. Booking Holdings (BKNG) holds 7.9% post a 17.85% trim, while Netflix (NFLX) stands at 7.1% following an 11.62% decrease.
Further adjustments include Broadridge Financial (BR) at 6.9% after a 14.35% reduction and NVR (NVR) also at 6.9% with the largest cut of 24.27%. Alphabet (GOOGL) weighs in at 5.8% post a 16.89% trim, matched by Analog Devices (ADI) at 5.8% after reducing 7.58%. Paychex (PAYX) sits at 5.0% following a 17.78% cut, and Ferrari (RACE) at 4.8% with a 15.31% reduction. These moves across the Ensemble Capital portfolio highlight a pattern of de-risking without abandoning core themes.
What the Portfolio Reveals
Ensemble Capital's Q3 moves paint a picture of prudent risk management in a frothy market, emphasizing quality businesses with strong moats over speculative growth.
- Quality over growth: Holdings like Home Depot, Mastercard, and Broadridge prioritize predictable cash flows and competitive edges, even as positions are trimmed.
- Sector focus: Heavy tilt toward consumer discretionary (HD, BKNG, RACE), fintech/payments (MA, PAYX), and tech innovators (NFLX, GOOGL).
- Risk management: Uniform reductions averaging 15% signal profit-taking and position rebalancing, maintaining concentration while creating dry powder.
- Long-term orientation: 25-quarter hold average shows commitment to compounding, undeterred by short-term volatility.
Portfolio Concentration Analysis
| Position | Value | % of Portfolio | Recent Change |
|---|---|---|---|
| The Home Depot, Inc. (HD) | $98.2M | 8.3% | Reduce 17.51% |
| Mastercard Incorporated (MA) | $94.0M | 8.0% | Reduce 13.97% |
| Booking Holdings Inc. (BKNG) | $93.5M | 7.9% | Reduce 17.85% |
| Netflix, Inc. (NFLX) | $83.5M | 7.1% | Reduce 11.62% |
| Broadridge Financial Solutions, Inc. (BR) | $81.9M | 6.9% | Reduce 14.35% |
| NVR, Inc. (NVR) | $81.4M | 6.9% | Reduce 24.27% |
| Alphabet Inc. (GOOGL) | $68.7M | 5.8% | Reduce 16.89% |
| Analog Devices, Inc. (ADI) | $68.1M | 5.8% | Reduce 7.58% |
| Paychex, Inc. (PAYX) | $58.8M | 5.0% | Reduce 17.78% |
This table underscores Ensemble Capital's conviction-driven approach, with the top 10 still representing 66.5% despite aggressive trims—the largest being NVR's 24.27% cut. Such concentration amplifies returns from winners like Home Depot and Mastercard while the reductions create flexibility. The pattern suggests Stannard-Stockton views current valuations as stretched, opting to lock in gains without fully exiting.
Investment Lessons from Sean Stannard-Stockton's Ensemble Approach
- Trim winners proactively: Reductions in outperformers like NVR 24.27% and Home Depot show discipline in taking profits to manage risk.
- Favor moat-rich compounders: Portfolio tilts to businesses with durable advantages, held for 25 quarters on average, prioritizing quality over quantity.
- Maintain concentration with care: 66.5% in top 10 demands deep conviction, balanced by low 9.1% turnover.
- De-risk amid uncertainty: Uniform cuts signal caution, creating capacity for better opportunities.
- Long holding periods pay off: Patience in names like Paychex exemplifies buy-and-hold in exceptional firms.
Looking Ahead: What Comes Next?
With portfolio size down to 22 positions and significant trims freeing up capital, Ensemble Capital appears positioned for selective redeployment. The two exited holdings suggest ongoing pruning of underperformers, potentially opening doors to undervalued moat stocks in consumer or tech. In a high-valuation environment, low turnover implies waiting for dips in quality names or fresh ideas aligning with Stannard-Stockton's criteria. Current holdings like Mastercard and Netflix set up for compounding if economic conditions stabilize, while cash flexibility supports opportunistic buys.
FAQ about Sean Stannard-Stockton Ensemble Capital Portfolio
Q: Why the widespread reductions in Q3 2024?
Ensemble Capital trimmed nearly all top holdings by 7-24%, likely to book profits after strong runs and build cash amid elevated valuations, maintaining quality focus without new buys.
Q: What does 66.5% top 10 concentration reveal about strategy?
It highlights high-conviction investing in researched winners like HD and MA, accepting volatility for superior long-term returns via moats.
Q: What sectors dominate Ensemble's holdings?
Consumer discretionary (Home Depot, Booking), fintech/services (Mastercard, Paychex), and tech (Netflix, Alphabet).
Q: How can I track Ensemble Capital's portfolio?
Follow quarterly 13F filings on the SEC site or use ValueSense's superinvestor tracker at https://valuesense.io/superinvestors/ensemble-capital for real-time analysis, historical data, and visualizations—note the 45-day lag.
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