Heebner Buys Polaris, Sherwin-Williams, Sells Whirlpool

Kenneth Heebner, who ranked as America’s No. 1 stock picker before losing his touch and most of his main fund’s assets, bought a stake in Polaris Industries Inc. (PII) during the second quarter while selling Whirlpool Corp. (WHR)

Heebner’s Capital Growth Management LP purchased 1.44 million shares of Polaris during the three-month period that ended June 30, according to a filing with the Securities and Exchange Commission. The Boston-based money manager bought 735,000 shares of Sherwin-Williams Co. (SHW) and sold out its stakes in Whirlpool and Cummins Inc.

Polaris, a snowmobile maker, climbed 3.6 percent since the end of June through yesterday while paintmaker Sherwin-Williams advanced 6.5 percent. Heebner, who is known for a willingness to shift directions quickly, exited Whirlpool, the world’s largest appliance maker, and diesel-engine maker Cummins as the stocks tumbled 20 percent and 19 percent, respectively, during the second quarter. Both companies were new holdings in the previous three months.

Heebner, whose CGM Focus Fund (CGMFX) topped all diversified U.S. stock mutual funds in the decade through 2007, lost an annual 6.8 percent in the past five years, trailing an average gain of 1.9 percent by the same group, according to data compiled by Bloomberg. The fund’s assets plunged to $1.48 billion at the end of July from the June 2008 peak of $10.3 billion.

Capital Growth’s stakes in financial companies rose the most during the second quarter as Heebner bought shares in JPMorgan Chase & Co. (JPM) and Bank of America Corp. (BAC) Energy had the biggest decrease as the money manager sold out shares of National Oilwell Varco Inc. (NOV), the biggest U.S. maker of oilfield equipment. National Oilwell, Capital Growth’s fifth-biggest holding by market value at the end of March, slumped 19 percent from April through June.

To contact the reporter on this story: Lu Wang in New York at lwang8@bloomberg.net.

To contact the editor responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net

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