Senator Investment Group Takes D.R. Horton Stake

Alex Klabin and Doug Silverman's hedge fund firm Senator Investment Group has filed a 13G with the SEC regarding shares of D.R. Horton (DHI).  Per the filing, Senator now owns 5.34% of the company with 20 million shares (inclusive of 5 million shares underlying call options).

This is a newly disclosed stake for the investment firm.  The filing was made due to portfolio activity on September 15th.

For more on this hedge fund, we highlighted another stock Senator has been buying.

Per Google Finance, DR Horton is "a homebuilding company. The Company constructed and sold homes in 27 states and 79 markets, as of September 30, 2015. The Company's segments include its 39 homebuilding divisions, its financial services operations and its other business activities. In the homebuilding segment, the Company builds and sells single-family detached homes and attached homes, such as town homes, duplexes, triplexes and condominiums. The Company's 39 homebuilding divisions are aggregated into six segments: East Region, South Central Region, Midwest Region, West Region, Southwest Region and Southeast Region. In the financial services segment, the Company sells mortgages and collects fees for title insurance agency and closing services. The Company has subsidiaries that conduct insurance-related operations; construct and own income-producing rental properties; own non-residential real estate, including ranch land and improvements, and own and operate oil and gas-related assets."

Rick Rieder's Presentation at Invest For Kids Chicago 2013

Next up in our notes from Invest For Kids Chicago 2013 is Rick Rieder of BlackRock.


Rick Rieder's Presentation at Invest For Kids Chicago

•    21 years at Lehman; Fixed income analyst hall of fame
•    Upside value of FI is muted to say the least
•    Talk on convert – fundamental value of significant proportion
•    Investment regime is changing
•    2003 to 2007 – leverage built up
•    2008 to 2013 – Fed saving system
•    Rebooting system back to “2003 or 2004”
•    Growth in the next few years has exogenous for moderate growth for next 2 to 3 years
 •    Expect moderate growth framework for next few years
•    Low rate framework
•    Buying a lot of agency mortgages
•    Can re-lever US balance sheets
•    Cost of equity versus BBB yields is very wide
•    Investors are forcing CEOs to return capital
•    Dividend to CapEx has also growth so ST growth for equity price but LT underinvestment
•    Need for interest income in market yet not enough assets so investors are forced out the rick curve to equities
•    Converts provide upside convexity, income, and the ability to leverage volatility(options are priced cheap due to volatility being held on the Fed’s balance sheet)
•    Likes DR Horton, MGM, and Ford converts
•    Also works in Europe & Asia 


Check out the rest of the hedge fund presentations from Invest For Kids Chicago here.