Friday, November 11, 2016

Pershing Square Trims Platform Specialty Products Position

Bill Ackman's hedge fund Pershing Square has filed an amended 13D with the SEC regarding its position in Platform Specialty Products (PAH).  Per the filing, Pershing now owns 14.5% of the company with 40.45 million shares.

This is a decrease of 2.28 million shares since the end of the second quarter when they owned over 42.73 million PAH shares.  The filing was made due to activity on November 10th when they sold shares at $8.78.

For more from this firm, we've highlighted other recent Pershing Square portfolio activity.

Per Yahoo Finance, Platform Specialty Products is "produces and sells specialty chemical products in the Americas, the Asia-Pacific, and Europe. It operates through two segments, Performance Solutions and Agricultural Solutions."

Hedge Fund Links ~ 11/11/16

Hedge funds are hiding out in gold [Bloomberg]

Carl Icahn left Trump victory party to bet $1 billion on stocks [Bloomberg]

Bridgewater: stocks will tank if Trump wins [Business Insider]

The money management gospel of Yale's endowment guru [NYTimes]

One hedge fund laid out why the market feels so dangerous right now [Yahoo]

New Goldman Sachs ETF tracks popular hedge fund stock bets [Reuters]

Thursday, November 10, 2016

Stan Druckenmiller: "I Basically Have a Large Bet on Economic Growth"

Duquesne Family Office founder Stan Druckenmiller appeared on CNBC today to give his thoughts on the markets and election. 

He noted that after the election a lot of regulation will be taken out of the system which should help get things going.  Other changes like tax reform, especially reducing the corporate tax rate encouraged him as he was "quite optimistic" on the economy.

Druckenmiller said that, "I have a large bet on economic growth ... I'm short bonds globally ... I'm short bunds, I'm short Italian bonds, I'm short US bonds.  I like sectors of the equity market that respond to growth, value, and materials, not things like staples and traditional growth stocks." 

He also added he likes the US dollar, with an emphasis against the euro.  And he has dumped his gold long (he actually sold during the night of the election).  He noted the reasons he previously owned it for 'might be ending.'

Druckenmiller also added, "If it wasn't for the messy conflict of rates rising with the stronger economic growth through fiscal policy, I would think there's so much low hanging fruit in terms of deregulation and tax reform, we could get a jolt of 4 percent growth for about 18 months."

That said, he's also cautious that interest rates rising could push that down to high 2, low 3 percent growth.  "I think the market is going to force this.  The market is going to push them to raise interest rates if my hopeful scenario turns out to be right."

He added that monetary policy essentially helped get Donald Trump elected as it caused a 'massive reallocation' of wealth from the middle class to the rich.

"Dr. Copper: have you seem him lately?  It's been rising.  Interest rates have been at stupid levels, they've been held down... they're like beach balls under water."

Embedded below are some of the videos from Druckenmiller's interview on CNBC

Video 1

Video 2

Baupost Group Trims Kindred Biosciences, Exits ChipMOS

Seth Klarman's investment firm Baupost Group has filed with the SEC regarding its positions in Kindred Biosciences (KIN) and ChipMOS Technologies (IMOS).

Trims Kindred Biosciences Stake

First, per a separately filed 13G, Baupost Group has also revealed they now own 4.85% of Kindred Biosciences (KIN) with 965,484 shares.

This is a decrease from their previous position of 3 million shares at the end of the second quarter.  The filing was made due to activity on October 31st.

We've previously highlighted other portfolio activity from Baupost Group here.

Per Google Finance, Kindred Biosciences is "a development-stage biopharmaceutical company. The Company is focused on developing therapies for pets. The Company's product pipeline consists of small molecules and biologics for a range of indications in dogs, cats and horses. The Company is developing product candidates for over 20 indications and focused on small molecule products and canine and feline biologics products. The Company is developing antibodies that targets canine Interleukin 17A (IL-17a), Interleukin 4A (IL-4Ra), Interleukin 3 (IL-3), CD-20, Immunoglobulin E (IgE), tumor necrosis factors (TNF) and other validated targets. The Company's lead product candidates are Zimeta, which is indicated for the treatment of fever in horses, and KIND-010 for management of weight loss in cats. The Company's other product candidates include KIND-010, KIND-014, KIND-015, KIND-510, KIND-502, KIND-0888, KIND-509, and several antibodies that target cytokines involved in atopic dermatitis."

Exits ChipMOS (Merger Closed)

Second, per an amended 13G, Klarman no longer owns any shares of ChipMOS (IMOS) as of October 31st.  A merger involving the company's shares recently closed.  Baupost previously owned 3.75 million shares at the end of the second quarter.

Per Google Finance, ChipMOS is "a provider of semiconductor assembly and test services. The Company provides testing and assembly services for liquid crystal display (LCD) and other flat-panel display driver semiconductors in Taiwan, and for memory and logic/mixed-signal products in Taiwan and Mainland China. The Company's business segments are testing services for memory and logic/mixed-signal semiconductors; assembly services for memory and logic/mixed-signal semiconductors; LCD and other flat-panel display driver semiconductor testing and assembly services, and bumping services for memory, logic/mixed-signal and LCD and other flat-panel display driver semiconductors. The Company provides testing services for a range of memory semiconductors, such as Static Random Access Memory (SRAM), Dynamic Random Access Memory (DRAM) and Flash memory. Its production facilities are located in Hsinchu and Tainan, Taiwan and Shanghai, Mainland China."

Carl Icahn Buys More Hertz, Herbalife

Activist investor Carl Icahn has submitted a slew of filings to the SEC recently regarding his positions in Hertz Global Holdings (HTZ) and Herbalife (HLF). 

Also, in an interview with Bloomberg, he noted that he left Donald Trump's victory party to put about $1 billion to work betting on US equities as futures sold off sharply on the election news.  This comes only a few weeks after Icahn said companies were overvalued considering the risk premium.

Icahn Adds To Hertz Stake

Per an amended 13D, Icahn now owns 33.77% of Hertz with just over 28 million shares.  He bought on the recent sell-off on November 8th and in total purchased over 15 million shares at prices of $22.64 and $25.02.

Per Yahoo Finance, Hertz Global "engages in the car rental business in North America, Europe, Latin America, Asia, Australia, Africa, the Middle East, and New Zealand. It operates the Hertz, Dollar, Thrifty, and Firefly car rental brands in approximately 9,980 corporate and licensee locations"

Also Boosts Herbalife Holdings Again

We previously highlighted how Icahn recently bought $100 million worth of Herbalife shares.  And he's at it again, per a newly submitted 13D.  He now owns 24.18% of HLF with 22.5 million shares, up from the 21.44 million we previously reported on.  The filing was made due to activity on November 8th.

Per Google Finance, Herbalife is "a global nutrition company. The Company develops and sells weight management, healthy meals and snacks, sports and fitness, energy and targeted nutritional products, as well as personal care products."

Tuesday, November 8, 2016

Howard Marks' Latest Memo: Implications of the Election

Oaktree Capital's Chairman Howard Marks has just penned another memo entitled "Implications of the Election."

Embedded below is Howard Marks' latest memo:

You can download a .pdf copy here.

For more recent hedge fund commentary, we've also posted up Third Point's Q3 letter.

ValueAct Capital Files Amended 13D on CBRE Group

Jeff Ubben's activist firm ValueAct Capital has filed an amended 13D with the SEC regarding its position in CBRE Group (CBG).  We've previously highlighted how ValueAct has been buying CBRE Group shares.  And it appears that continued further in early November.

Per the latest filing, ValueAct now owns 12.1% of CBG with over 40.67 million shares.  This is up from the most recent 36.83 million shares we reported.  The filing notes they were buying on November 2nd through fourth at prices between $25.48 and $26.49.

For more from this firm, check out Mason Morfit's presentation at Sohn San Francisco.

Per Google Finance, CBRE Group is "a commercial real estate services and investment company.  It offers services to occupiers, owners, lenders and investors in office, retail, industrial, multifamily and other types of commercial real estate. It offers commercial real estate services under the CBRE brand name, investment management services under the CBRE Global Investors brand name and development services under the Trammell Crow Company brand name. It is focused on several competencies, including commercial property, corporate facilities, project and transaction management, tenant/occupier and property/agency leasing, capital markets solutions, real estate investment management, valuation, development services and proprietary research." 

Empyrean Capital Increases Enova International Stake

Michael Price and Amos Meron's hedge fund Empyrean Capital has filed a 13G with the SEC regarding its position in Enova International (ENVA).  Per the filing, they now own 7.1% of the company with over 2.37 million shares.

This means they've boosted their position size by over 2.11 million shares since the end of the second quarter when they owned only 264,185 shares.  The filing was made due to activity on October 25th.

About Empyrean Capital

Empyrean is an event-driven hedge fund based in California.  As of their last 13F filing, they reported assets under management of $2.21 billion, but keep in mind that doesn't include international stock positions, cash, etc.

About Enova International

Per Google Finance, Enova International is "a provider of online financial services to non-prime consumers and small businesses, providing access to credit powered by its advanced analytics, technology, and online platform and services. Enova has provided over four million customers around the globe access to more than $17 billion in loans and financing. The financial technology company has a portfolio of trusted brands serving consumers, including CashNetUSA, DollarsDirect, NetCredit, On Stride Financial, Pounds to Pocket, QuickQuid and Simplic; two brands serving small businesses, Headway Capital and The Business Backer, and offers online lending platform services to lenders. Through its Enova Decisions brand, it also delivers on-demand decision-making technology and real-time predictive analytics services to clients."