Andreas Halvorsen's Viking Global 13F Filing: First Quarter 2009 ~ market folly

Monday, May 18, 2009

Andreas Halvorsen's Viking Global 13F Filing: First Quarter 2009

This is the 1st Quarter 2009 edition of our ongoing hedge fund portfolio tracking series. Before reading this update, make sure you check out the Hedge Fund 13F filings series preface.

We'll start our Q1 '09 coverage with Viking Global. Andreas Halvorsen is one of the many 'Tiger Cub' fund managers we cover here on the blog. 'Tiger Cubs' are the progeny of legendary investor and hedge fund manager Julian Robertson of Tiger Management. Many of the critical members of Tiger started their own funds, and Halvorsen is no different. Halvorsen has taken what he learned/used at Tiger and added his own spice to the value oriented, yet growth at a reasonable price (G.A.R.P.) tolerable investment style. Viking employs a fundamental strategy, using a bottom-up process to pick stocks. In terms of recent performance, They were +0.99% for March, and +9.27% year to date as of that time. We covered Viking and other hedge funds in our March performance update.

Halvorsen attended Williams College and received his MBA from Stanford, while his work history includes stays at Morgan Stanley and Tiger. In Alpha's 2008 hedge fund rankings, Viking was ranked #70 in the world. You can view Viking's most 2008 year end investor letter if you want to look through the eyes of Halvorsen and company.

The following were their long equity, note, and options holdings as of March 31st, 2009 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):
Alliance Data Systems (ADS)
Career Education (CECO)
Charles River Labs (CRL)
Cognizant (CTSH)
CVS Caremark (CVS)
Danaher (DHR)
Google (GOOG)
Lender Processing Services (LPS)
Oracle (ORCL)
Suntrust Banks (STI)
Teleflex (TFX)
Travelers Companies (UHS)
Thermo Fisher Scientific (TMO)
Thoratec (THOR)
Universal Health Services (UHS)
Visa (V)
Walmart (WMT)

Some Increased Positions (A few positions they already owned but added shares to)
Mastercard (MA): Increased by 176%
JPMorgan Chase: Increased by 72%
Invesco (IVZ): Increased by 23%
Qualcomm (QCOM): Increased by 12%

Some Reduced Positions (Some positions they sold some shares of - note not all sales listed)
DaVita (DVA): Reduced by 46%
First Horizon National (FHN): Reduced by 45%
Illumina (ILMN): Reduced by 37.5%
Aon (AOC): Reduced by 34%
Apollo Group (APOL): Reduced by 32%
McKesson (MCK): Reduced by 27%

Removed Positions (Positions they sold out of completely)
Alcon (ACL)
Bank of America (BAC)
Axis Capital (AXS)
ITT Educational (ESI)
Kroger (KR)
ModusLink (MLNK)
Renaissance Holdings (RNR)
St Jude Medical (STJ)
Sherwin Williams (SHW)
Verisign (VRSN)
Vulcan Materials (VMC)

Top 15 Holdings (by % of portfolio)

  1. Apollo Group (APOL): 12.67% of portfolio
  2. Mastercard (MA): 12.51% of portfolio
  3. Invesco (IVZ): 8.88% of portfolio
  4. Qualcomm (QCOM): 7.11% of portfolio
  5. Google (GOOG): 5.83% of portfolio
  6. Visa (V): 5.8% of portfolio
  7. Priceline (PCLN): 5.33% of portfolio
  8. JPMorganChase (JPM): 4.12% of portfolio
  9. NRG Energy (NRG): 3.4% of portfolio
  10. Cognizant (CTSH): 3.24% of portfolio
  11. Career Education (CECO): 3.13% of portfolio
  12. MSCI (MXB): 3% of portfolio
  13. DaVita (DVA): 2.7% of portfolio
  14. Macrovision (MVSN): 1.96% of portfolio
  15. Charles River Labs (CRL): 1.87% of portfolio

From Q3 to Q4 of 2008, Viking had some substantial turnover in their portfolio. And, the most recent quarter is no different. In the first quarter of 2009, they sold completely out of 12 names and then started new positions in 18 other names. Last time around, we focused on Viking's decision to sell out of Visa and instead buy Mastercard. Well, this time around, they bought both. Viking re-bought their Visa position and brought it all the way up to their 6th largest holding. Additionally, they boosted their current Mastercard position by an additional 176%. They clearly have conviction in this payment-processing duopoly. (And, so do many other hedge funds for that matter).

Viking also started a new position in Google (GOOG) and brought it up to their fifth largest holding. That about covers all the major moves in the portfolio (besides the names they sold out of completely). Viking's top position remains Apollo Group (APOL). However, they did sell a substantial part of their position from quarter to quarter.

Assets from the collective holdings reported to the SEC via 13F filing were $3.5 billion last quarter and were $3.57 billion this quarter. This is just one of the 40+ prominent funds that we'll be covering in our hedge fund Q1 2009 portfolio series. Check back each day as we cover new fund portfolios, or get our updates for free via email or for free via RSS Reader.

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