Friday, October 12, 2018

Sohn San Francisco Investment Conference: Final Speakers & Registration

The Sohn San Francisco Investment Conference is only a few weeks away on October 29th.  It will feature top investment managers sharing investment ideas in order to support the Excellence in Investing for Children's Causes Foundation and its beneficiaries.

The conference supports organizations improving educational opportunities for under-served youth and a portion of the proceeds also benefits The Sohn Conference Foundation and their research on pediatric cancer.

If you're on the west coast, this is the investment conference to attend.  You can get more information about the conference here:

Sohn San Francisco Speakers List

- Mick McGuire, Marcato Capital Management

- Alex Gleser, TPG Public Equity Partners

- Glen Kacher, Light Street Capital

- Andrew Parmentier, Highland Capital

- Shashin Shah, Think Investments

- Dan Morehead, Pantera Capital

- Kevin Oram, Praesidium Investment Management

- Jeff Osher, No Street Capital

- Jeff Shen, Ph.D., BlackRock

- Gil Simon, SoMa Equity Partners

- Mayor London N. Breed, Mayor of San Francisco

You can hear all the investment pitches from these managers by registering for the conference here.

Next Wave Sohn Speakers

- Vineer Bhansali, Ph.D., Long Tail Alpha

- Marcelo Desio, Lucha Capital Management

- Daniel Kozlowski, Plaisance Capital

- Franklin Parlamis, Aequim Alternative Investments

Event Details

When: October 29th, 2018

Where: Hyatt Regency, San Francisco


11:30am to 12:30pm - Networking and Buffet Lunch

12:30pm to 2:00pm - Next Wave Sohn: Emerging Managers

2:30pm to 6pm - Sohn Conference Main Event

6:00 pm to 7:30pm - Cocktail Reception

The conference is only a few weeks away, so act quickly before it's too late.  Click here to register for the event.

Hedge Fund Links ~ 10/12/18

Hedge fund Highfields Capital to shut down [Reuters]

Another shutdown: Tourbillon Capital [Bloomberg]

Recent thoughts from Stan Druckenmiller [Business Insider]

Profile of Elliott Management's Paul Singer [New Yorker]

Profile of Jim Chanos [Institutional Investor]

Profile of Joseph Edelman: The 41% man [Institutional Investor]

Study finds funds in the business of breaking up deals see payday [CNBC]

At hedge funds, where are the women? [WSJ]

The incredible shrinking hedge fund [Bloomberg]

When not to invest in a hedge fund [Institutional Investor]

A fund manager's fancy car might be a red flag [Barrons]

Viking Global Files 13D on Urovant Sciences

Andreas Halvorsen's hedge fund firm Viking Global has filed a 13D with the SEC regarding shares of Urovant Sciences (UROV).  Per the filing, Viking now shows a 75.6% stake in the company with over 22.7 million shares, though the 13D notes that "The Reporting Persons do not directly own any Common Shares." 

The company recently completed its initial public offering (IPO).  Viking has previously invested in Roivant Sciences in 2016, a holding company that has created numerous subsidiaries, including newly public Urovant, which could explain Viking's SEC filing.  Other Roivant subsidiaries include Axovant Sciences, Myovant Sciences, and Enzyvant Sciences, to name a few.

Viking also invested in Roivant again in 2017 with an undisclosed amount of funding.  SoftBank's Vision Fund is also an investor in Roivant, but not the subsidiaries, at least that was the case as of mid-2017.  Roivant was founded by Vivek Ramaswamy.

Thursday, October 11, 2018

Third Point's Presentation on Campbells (CPB): Refresh the Recipe

Dan Loeb's hedge fund firm Third Point has an activist position in Campbells (CPB).  They recently released a presentation called #RefreshTheRecipe where they are pushing for change at the company.

Third Point highlights that Campbells has underperformed both peers and the S&P under various timelines (19% shareholder return vs 306% for S&P over the last 20 years).  Third Point seeks to replace the board to enact change and originally pushed for the company to sell itself or merge with another packaged foods company.

Dan Loeb's firm is looking to turnaround the soup business, stabilize the fresh food business and stop margin declines with disciplined cost management, and make the overall product offerings more relevant to modern consumers via ingredients/flavors and new designs/packaging.

For the snacks business, Third Point sees opportunity to innovate with new flavors, ingredients and packaging to drive market share, execute on deal synergies from the Snyder's-Lance deal, and wants them to explore divestitures of non-core brands like Pop Secret and Pepperidge Farm frozen cakes.

If the whole business were to be sold, they comp relevant transactions leading to a 14-15x EBITDA multiple, or between $52 and $58 per Campbells share.  CPB currently trades around $37.

Third Point's Campbell's Presentation: Refresh The Recipe

Embedded below is the slideshow:

For other recent hedge fund commentary, we posted up Bill Ackman's presentation on Starbucks as well as Greenlight Capital's Q3 letter.

Trian Partners Discloses PPG Industries Stake

Nelson Peltz's Trian Partners has filed an amended 13F with the SEC.  In it, they reveal a new position in PPG Industries (PPG).  As of the end of the second quarter, they owned 2.59 million shares. 

They had previously disclosed this information privately to the SEC and requested confidential treatment. 

It's unclear what their position size is currently, and we won't see it until they update their 13F as of the end of the third quarter.  That filing will come in mid-to-late November. 

The paints and coatings company recently reported earnings and guidance, and shares sold off sharply on the news.

JANA Partners Trims HD Supply Position

Barry Rosenstein's hedge fund firm JANA Partners has filed a Form 4 with the SEC regarding its stake in HD Supply Holdings (HDS).  Per the filing, JANA sold 621,235 shares on October 5th at a weighted average price of $42.37.  After this sale, they still own over 5.39 million shares.

Tuesday, October 9, 2018

Bill Ackman Long Starbucks: Pershing Square Presentation

At the Grant's Interest Rate Observer Conference, Bill Ackman of Pershing Square unveiled a new long position: Starbucks (SBUX).  The presentation is entitled 'Doppio' and Pershing now owns over 15 million shares with a cost basis of $51 and they've used forward contracts.  It's around a $900 million stake.

Pershing notes SBUX is trading at 22x, a discount to the average of 26x and they feel premium coffee is a secularly growth category.  If same store sales and valuation can return to average levels, SBUX shares can double in three years.

Pershing's thesis is that this is a rare opportunity to own one of the world's best franchises at a discount.  They're encouraged by actions of the new leadership team, as they've streamlined the portfolio (sold Tazo, closed Teavana stores, sold the consumer packaged goods business to Nestle).  They're also initiating cost savings and a significant share buyback plan (~$19bn three year target).

Pershing Square: Long Starbucks Presentation

Embedded below is the .pdf of the presentation:

You can download a copy here.

For other recent hedge fund commentary, we also posted up David Einhorn & Greenlight Capital's Q3 letter.

Greenlight Capital Q3 Letter: Sold Apple, Still Short Tesla

David Einhorn's hedge fund Greenlight Capital has had a rough 2018.  They're now down 25.7% for the year.  During the quarter, they exited the last of their longstanding Apple (AAPL) position at $228 per share. 

They feel their AAPL thesis that was once differentiated has now become consensus and the valuation of 17x forward earnings is "much less enticing and we are somewhat worried about Chinese retaliation against America's trade policies."

Greenlight also continues to be bearish on Tesla and noted many similarities to Lehman Brothers before its collapse.  They also highlighted CEO Elon Musk's erratic behavior.  There's numerous paragraphs about TSLA in the letter below.

Greenlight New Longs: Altice USA and BT Group

In other notable portfolio activity, they initiated two new longs: Altice USA (ATUS) and BT Group. 

ATUS they acquired at $18.38 and view it as a discounted play on cable peers in the US.  They feel the company has better cashflow conversion and more investment opportunities than rivals. 

BT Group they purchased at £2.19 and feel that shares were cheap at 4.7x EV/EBITDA and an 8% dividend yield. 

They also covered their 11 year short in Martin Marietta Materials (MLM) and covered another short: TransDigm Group (TDG). 

Also, they sold out of their Micron (MU) position and exited their Mylan (MYL) stake as well.

Greenlight Capital's Q3 Letter

Embedded below is Greenlight Capital's Q3 Letter:

For more recent hedge fund commentary, check out Bill Ackman's new long Starbucks SBUX presentaiton.

Baupost Group Files 13D on Viasat, Joins Board

Seth Klarman's investment firm Baupost Group has filed a 13D with the SEC regarding its stake in Viasat (VSAT).  Per the filing, Baupost owns 23.06% of the company with over 13.73 million shares.  This ownership stake amount is unchanged from the end of the second quarter.

In the filing, Baupost notes they recently were invited to join the company's board in a non-voting capacity.

In a press release issued by the company, they noted: 

“As a decade-long investor in Viasat, we remain excited about the Company’s growth potential in both its defense and commercial businesses,” said Greg Ciongoli, partner, The Baupost Group. “We appreciate this opportunity to contribute to boardroom discussions.”

“Baupost has a successful long-term philosophy of value investing,” said Mark Dankberg, chairman and CEO, Viasat. “Inviting Baupost to participate as a Board observer provides us with an opportunity to capitalize on their strategic insight, as well as their valuable financial and investment expertise.”