Lone Pine Capital Buys Ctrip.com, Sells Ashmore ~ market folly

Friday, February 25, 2011

Lone Pine Capital Buys Ctrip.com, Sells Ashmore

Stephen Mandel's Lone Pine Capital recently purchased more of one security and sold some of another. First, due to a 13G filed with the SEC regarding portfolio activity on February 14th, Lone Pine now shows a 5.8% ownership stake in Ctrip.com (CTRP). The hedge fund currently owns 7,893,233 American depositary shares.

This is a 83% increase in their position size as they owned 4,312,650 shares at the end of 2010. The company's shares recently sold-off after its first quarter revenue missed estimates. Lone Pine most likely utilized this drop to add to their position.

Second, the hedge fund firm also sold some Ashmore (LON:ASHM). After owning 6.21% of the company in January of 2009, Lone Pine has slowly reduced its stake to now under 3% of shares outstanding. Ashmore recently agreed to buy 63% of Emerging Markets Management for around $96 million in cash and $29.9 million in new stock.

Since this now falls below the regulatory threshold for reporting, we won't know if Mandel's hedge fund firm sold completely out of the name, or if they still hold a small position. One thing is clear though, they've steadily reduced exposure over the past two years. To see the rest of their positions, we recently updated Lone Pine's portfolio in the new issue of our newsletter.

Per Google Finance Ctrip.com is "a travel service provider for hotel accommodations, airline tickets and packaged tours in China. It also sells packaged tours that include transportation and accommodations, as well as guided tours in some instances. The Company aggregates information on hotels and flights and enable its customers to make hotel and flight bookings."

"Ashmore Group plc (Ashmore) is engaged in providing investment management services. The Company is a fund manager across six core investment themes, such as external debt, local currency, special situations, equity, corporate high yield and multi-strategy."

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