Lee Ainslie's Maverick Capital 13F Filing: Q4 2008 ~ market folly

Wednesday, March 11, 2009

Lee Ainslie's Maverick Capital 13F Filing: Q4 2008

This is the 4th Quarter 2008 edition of our ongoing hedge fund portfolio tracking series. Before reading this update, make sure you check out the Hedge Fund 13F filings preface.

Next up, we have Maverick Capital. Lee Ainslie started Maverick Capital back in 1993 with $38 million. Nowadays, the fund is worth $4 billion. Ainslie, like many of the other fund managers we've profiled, has a background rooted in learning from legendary great Julian Robertson at Tiger Management. These proteges (nicknamed 'Tiger Cubs') learned from the best and have had great success running their own funds. Some of the other Tiger Cubs include Stephen Mandel's Lone Pine Capital and Andreas Halvorsen's Viking Global. Maverick's strategy is straight up stock picking, both long and short. While they focus on both the long and short sides of the book, they do not employ pairs trades.

They try to hedge their positions like the true definition of a hedge fund. Maverick uses a value approach (obviously learned from Julian) and one of their most popular metrics is finding companies and comparing their enterprise value to sustainable free cash flow. Their Maverick Fund finished -26.2% for 2008, as noted in our year-end hedge fund performance numbers post. Some of their notable past activity includes selling out of their entire Under Armour (UA) position via a 13G filing.

The following were their long equity, note, and options holdings as of December 31st, 2008 as filed with the SEC. We have not detailed the changes to every single position in this update, but we have covered all the major moves. All holdings are common stock unless otherwise denoted.

Some New Positions (Brand new positions that they initiated in the last quarter):
Qualcomm (QCOM)
Staples (SPLS)
Carnival (CCL)
Pfizer (PFE)
JPMorgan Chase (JPM)
Eaton (ETN)
Biogen Idec (BIIB)
Macys (M)
Genentech (DNA)
Cummins (CMI)
Renaissance Holdings (RNR)
Discovery Communications (DISCA)
Discovery Communications (DISCK)
State Street (STT)
American Tower (AMT)
Xenoport (XNPT)
Chico Fas (CHS)
The Finish Line (FINL)
Petroquest (PQ)
Gymboree (GYMB)
Healthnet (HNT)
Interval Leisure (IILG)

Some Increased Positions (A few positions they already owned but added shares to)
DirecTV (DTV): Increased position by 92.6%
Berkshire Hathaway (BRK-A): Increased position by 73%
XTO Energy (XTO): Increased position by 36%
Cognizant (CTSH): Increased position by 33.9%
Fidelity Information (FIS): Increased position by 18.8%

Some Reduced Positions (Some positions they sold some shares of - note not all sales listed)
Netapp (NTAP): Reduced position by 77.8%
Apollo Group (APOL): Reduced position by 64.2%
ThermoFisher Scientific (TMO): Reduced position by 64%
Lorillard (LO): Reduced position by 61%
Citrix (CTXS): Reduced position by 53.6%
First Solar (FSLR): Reduced position by 51.5%
Gilead (GILD): Reduced position by 46.5%
America Movil (AMX): Reduced position by 40.7%
Marvell (MRVL): Reduced position by 38%
Priceline (PCLN): Reduced position by 37.7%
Dicks Sporting Goods (DKS): Reduced position by 37.5%
Baxter (BAX): Reduced position by 31%
Infinera (INFN): Reduced position by 30%
DeVry (DV): Reduced position by 28.9%
Amgen (AMGN): Reduced position by 28.6%
Apple (AAPL): Reduced position by 25.96%
Berkshire Hathaway (BRK-B): Reduced position by 35.5%
Research in Motion (RIMM): Reduced position by 21.3%
Raytheon (RTN): Reduced position by 19.6%

Removed Positions (Positions they sold out of completely)
First Marblehead (FMD)
Comscore (SCOR)
Salesforce (CRM)
Hudson City Bancorp (HCBK)
JCrew (JCG)
VMWare (VMW)
Las Vegas Sands (LVS)
Leap Wireless (LEAP)
Freeport McMoran (FCX)
Lamar Advertising (LAMR)
Goldman Sachs (GS)
Yingli Green Energy (YGE)
Digital River (DRIV)
Potash (POT)
Cardinal Health (CAH)
Morgan Stanley (MS)
MetroPCS (PCS)
UnderArmour (UA)
Resmed (RMD)
Dish Network (DISH)
Western Union (WU)
Marsh & McLennan (MMC)
Schering Plough (SGP)
Burlington Northern (BNI)
Activision (ATVI)
Cigna (CI)
Monsanto (MON)
Advanced Micro Devices (AMD)

Top 20 Holdings (by % of portfolio)

  1. CVS Caremark (CVS): 4.25% of the portfolio
  2. Raytheon (RTN): 4.17% of the portfolio
  3. Qualcomm (QCOM): 3.85% of the portfolio
  4. Amgen (AMGN): 3.7% of the portfolio
  5. Apple (AAPL): 3.37% of the portfolio
  6. XTO Energy (XTO): 3.13% of the portfolio
  7. Gilead Sciences (GILD): 2.84% of the portfolio
  8. Staples (SPLS): 2.56% of the portfolio
  9. Research in Motion (RIMM): 2.5% of the portfolio
  10. Apollo Group (APOL): 2.5% of the portfolio
  11. Baxter International (BAX): 2.4% of the portfolio
  12. Marvell Technology (MRVL): 2.4% of the portfolio
  13. Fidelity Information (FIS): 2.4% of the portfolio
  14. Liberty Media (LMDIA): 2.37% of the portfolio
  15. DirecTV (DTV): 2.35% of the portfolio
  16. Wyeth (WYE): 2.34% of the portfolio
  17. Carnival (CCL): 2.25% of the portfolio
  18. America Movil (AMX): 2.21% of the portfolio
  19. Berkshire Hathaway (BRK-A): 2.11% of the portfolio
  20. Priceline (PCLN): 2.1% of the portfolio

Right from the start we notice common holdings with that of other Tiger Cub hedge funds. Apollo Group, America Movil, Qualcomm, and Carnival are all favorites of these various funds. And, its no surprise really, as they all come from the same school of thought. And, undoubtedly, they all stay in touch. Its also worth noting that they started new positions in some names and brought them up in size to the top 20 holdings. Some of these include Carnival, Qualcomm, and Staples. Other than that, they were doing a lot of selling across the board. Assets from the collective long US equity, options, and note holdings were $8.2 billion last quarter and were down to $4.8 billion this quarter. This is just one of many funds in our hedge fund portfolio tracking series in which we're tracking 35+ prominent funds. We've already covered Paulson & Co (John Paulson), Carl Icahn, Warren Buffett, Stephen Mandel's Lone Pine Capital, George Soros, Bill Ackman's Pershing Square, Andreas Halvorsen's Viking Global, Timothy Barakett's Atticus Capital, David Einhorn's Greenlight Capital, Seth Klarman's Baupost Group, Peter Thiel's Clarium Capital, Bret Barakett's Tremblant Capital, David Stemerman's Conatus Capital, and James Pallotta's Raptor Capital Management. Look for our updates as we will be covering a new fund each day.

blog comments powered by Disqus