Trian Partners' Procter & Gamble Presentation: Revitalize P&G Together

Nelson Peltz's activist firm Trian Partners recently put together a slide deck on their Procter & Gamble (PG) position entitled "Revitalize P&G Together."

They note that organic sales growth has underperformed peers such as Unilever, Reckitt Benckiser, Henkel, Arm & Hammer, and others.  Also, volume growth has trailed peers like Clorox, Church & Dwight, etc.

Trian's initiatives for the company include regaining lost market share, ensure management's productivity plan delivers results, develop small mid-size local brands, make M&A a growth strategy, win in digital, and improve corporate governance.

They outline their plan for the company and highlight all the issues the company is facing in their slidedeck.

Embedded below is Trian Partners' presentation on P&G:



You can download a .pdf copy here.

Bill Ackman's Q2 Letter: Updates on Pershing's Positions

The New York Post has shared Bill Ackman's Q2 letter and it's quite in-depth and worth highlighting.  The Pershing Square manager provides updates on many of his positions, including his new position in Air Products & Chemicals (APD), his controversial Herbalife (HLF) short, as well as their troubled stake in J.C. Penney (JCP) and more.

Embedded below is Ackman's Q2 letter:




For more from this manager, you can check out Ackman's presentation on Procter & Gamble.

Bill Ackman's Slideshow Presentation From Sohn Conference: A Rising Tide is a Good Gamble

Hat tip to ValueWalk for posting up Bill Ackman's slideshow presentation from the Sohn Conference, entitled: "A Rising Tide is a Good Gamble". 

We previously posted up notes from Ackman's presentation on Procter & Gamble from the event last month.  You can also see notes from all other speakers here.

Embedded below is Ackman's slideshow on PG:



In other activity from this hedge fund, we just detailed how Pershing Square plans to trim its Canadian Pacific stake.

Notes From Ira Sohn Conference 2013: Einhorn, Druckenmiller, Eisman & More

Today we present notes from the 2013 Ira Sohn Conference in New York.  The 18th annual event featured top hedge fund managers presenting investment ideas and the proceeds from the event benefit pediatric cancer research and treatment via the Sohn Conference Foundation.  Summaries of each speaker's talk are linked below.


Notes From Ira Sohn Conference 2013

Stanley Druckenmiller (Druckenmiller Family Office) on commodities, short Australian Dollar

David Einhorn (Greenlight Capital) on Oil States International (OIS)

Steve Eisman (Emrys Partners) on housing plays: OCN, LEN, PHM, FBHS, FOR, CLNY, AMWD

Paul Singer (Elliott Management): a financial overview & history of markets

Jim Chanos (Kynikos Associates): short disk drive makers Seagate & Western Digital

Kyle Bass (Hayman Capital) on Dex Media (DXM) and Japan

Bill Ackman (Pershing Square): long Procter & Gamble (PG)

Jeffrey Gundlach (DoubleLine) on quantitative easing, short French bonds, short Chipotle

Jonathon Jacobson (Highfields Capital): Short Digital Realty Trust (DLR)

Mitchell Julis (Canyon Partners) on Clear Channel Outdoor (CCO) & Apple (AAPL)

Keith Meister (Corvex Management): long Time Warner Telecom (TWTC) & Level 3 (LVLT)

David Stemerman (Conatus Capital): short African Bank (ABL:SJ)

Li Lu (Himalaya Capital) on Korean preferreds (Samsung, Hyundai)

Clifton Robbins (Blue Harbour Group) on CACI & Akamai

Tor Olav Troim (Seadrill) on opportunities in cyclical industries

Simeon McMillan (Columbia MBA, investment contest winner) on Tribune Company

Bill Ackman's Sohn Conference Presentation on Procter & Gamble (PG)

We're posting up notes from the Ira Sohn Conference 2013 in New York.  Next up is a summary of the presentation from Bill Ackman of Pershing Square Capital.  He presented "A Rising Tide is a Good Gamble," a pitch on shares of Procter & Gamble (PG).

Procter & Gamble (PG)

Ackman seemed more subdued than usual, perhaps chastened from the Herbalife (HLF) short criticism he's received lately.  His idea was long PG.  40% of revenue is from the emerging markets. Says P&G is under-earning because of a bloated overhead cost structure, never brought over Gillette’s cost-conscious culture.

Suboptimal manufacturing, too many layers of management, marketing is 16.5% of revenue and they aren't getting their proper return on that investment. Pricing in some categories is not optimized. These are fixable.

Company itself has recognized their "bloat" and has announced $10B of cost reduction, $6B from COGS, etc. Then several pages of slides going over how they can cut costs.

For more resources on this hedge fund manager, we've posted up about Ackman's Mondelez stake as well as his presentations on Herbalife.


Check out the rest of the hedge fund presentations from the event: notes from Ira Sohn Conference 2013.

Bill Ackman on GGP, Procter & Gamble, and His Mystery Short: Interview

Pershing Square Capital Management founder Bill Ackman recently appeared on CNBC Squawk Box to talk about his positions in General Growth Properties (GGP), Procter & Gamble (PG) and dropped a hint about his newest short position.

General Growth Properties (GGP)

Ackman again talked about how Brookfield Asset Management (BAM) is trying to slowly takeover GGP without paying a premium.  Ackman is pushing for Simon Property Group (SPG) to buy GGP.  A background on the situation is provided in Ackman's letter to GGP.  And then an in-depth look at his proposal was posted in Bill Ackman's presentation from the Value Investing Congress if you missed it.

Procter & Gamble (PG)

Of his newest investment, Ackman says there's not a culture of efficiency.  He argues the company's fat and bloated.  The company has a solid board of directors and he's already met with them and will look to see what they can do about helping improve things.

Ackman's Newest Short

We highlighted at the Value Investing Congress how Ackman teased the crowd that he had a new short position but did not reveal it.  He gave a hint in this interview, saying: "it's a good for America short ... as soon as the company goes out of business, the country will be better off."


Embedded below is Bill Ackman's interview video:



For more from this investor, check out Bill Ackman's recommended reading list.

Bill Ackman on General Growth Properties, J.C. Penney, Procter & Gamble at Value Investing Congress

Continuing coverage, we're posting up notes from the Value Investing Congress.  Below are notes from the presentation of Bill Ackman of Pershing Square Capital Management.  His talk was about General Growth Properties (GGP) and the need to stop Brookfield Asset Management (BAM) from acquiring it.


General Growth Properties (GGP)

$19.48 stock, 5% cap rate.  Long-term contracts.  85% recurring revenue, 3% rent escalators per year.  Even during Great Recession, and GGP's bankruptcy, NOI only dropped 10%. Up from $15 to $20 out of bankruptcy, spun off HHC. Stock fell later in 2011, collapsed to $12.50 last summer.

Very interesting saga about how Simon Property Group (SPG) and Brookfield Asset Management (BAM) and Pershing all tried to do a deal with the company (we posted Ackman's letter to GGP).

This summer, Pershing filed a13D requesting a financial advisor to look a selling the company.  Board rejects the idea.   Ackman contends that director Patterson isn't independent, so 5 of 9 board members are conflicted.  He says if status quo continues, BAM will get control of the company without paying a premium. Says GGP will always have a "Brookfield Discount."

Says SPG may still be interested in buying GGP even though he says he won't do a deal.  Ackman says shareholders benefit from a merger with SPG, it's less risk, and has synergies.  He details the synergies of a deal with SPG:

Incremental NOI, etc.  Saves overhead costs of almost $110M per year.  Says $350-590M in incremental cash flow, with a multiple, several billion of value.  Says 86% stock/14% cash deal makes sense, pay 29% premium.  Accretion of 5.4% from day one.  Deal is $29 equivalent price by end of the year, up from about $20 today.  Dividend also goes up, 51% increase to shareholders.  Lower leverage, more liquid.  He assumes SPG stock will also go up.

Ackman claims BAM was filing prospectus in the meantime, to buy the company themselves.     His solution:  the board of GGP should form a independent committee, hire independent financial advisors, to salvage the control premium.

Q&A:  How do you expect the board to do this, since they've already dismissed it outright? He says they didn't understand what they were being presented.  "Properly informed" he says they will respond correctly.


J.C. Penney (JCP)

Updates on JCP?  Says very few people followed them in GGP, because is was unconventional.  Same with JCP, it there is enormous skepticism. Says JCP is building "a mall within a mall" and 85% of their stores are in malls with $300/sq ft and above, B+ malls.  SSS down 20% in 1H12 and will be in 2H12 as well.  The shops are working, but it takes time. Also, easier comps next year.  You have to think more than 3 months ahead, it's interesting.  Also, killed the dividend, which was unpopular.

What if the JCP strategy doesn't work?  Issue is how do you get them in the store?  A free haircut is better than a coupon of 50% off an inflated price. 


Procter & Gamble (PG)

He's long PG - why does he like it?  Says company has bloated cost structure, organization gotten more complex.  Company instead of cutting costs, raised prices to protect profits, and started to lose market shares.  He has attributed these issues to senior management failings.  If CEO doesn't turn things around soon, they will have to look outside to find a new CEO.  


Shorts?

Best short idea?  waiting to put on more, will share it publicly after they fill their position.  (As you'll see in our past profile of Pershing Square, shorting is less common for them to begin with).

For more on Ackman, we've posted an excerpt from his Q2 letter on why he sold Citigroup.


Embedded below is Ackman's slideshow presentation from the Value Investing Congress:





Be sure to check out the rest of the presentations from the Value Investing Congress.

Delivering Alpha Real Estate Panel: Ackman, Sternlicht & Gray

Continuing coverage of CNBC & Institutional Investor's Delivering Alpha Conference, we're now shifting to the real estate panel featuring Pershing Square's Bill Ackman, Starwood Capital Group's Barry Sternlicht and Blackstone Group's Johnathan Gray.

If you missed it, we've also posted up notes from the other panels at the conference.

Bill Ackman (Pershing Square):  Ackman's been in the news recently regarding a new stake in Proctor & Gamble (PG) so naturally he addressed that first saying, "We think it's a great company ... it's a cheap stock, but it's cheap for a reason.  We own the stock, we like the company, we own about $1.8 billion in equity in options."

That's a lot when you frame it in the context of a $10 billion dollar fund.  Recently, Ackman was also saying his PG bet is the largest initial bet on a company he's ever made.  Many have postured that he'll look to shake-up management and examine splitting the business up.

Ackman also touched on his stake in J.C. Penney (JCP), whose shares have been in steady decline.  He argued that it's the only company that can make 15-20x return (seems awful high), attributing the sell-off to a PR problem versus fundamentals.

On the subject of real estate, he advocated buying single family homes, arguing that it's a good business and an "asset class where institutions are underrepresented."  For more from this investor, we just posted up Ackman's recommended reading list.


Barry Sternlicht (Starwood Capital):  He noted that there's enough debt financing and that spreads are tight.  He also pointed out that you don't really see foreign banks here.

Echoing Ackman, Sternlicht says they've been buying houses and thinks the market could even possibly be overbought.  On Europe, he thinks it's still the first inning there so if you get involved, you've got to buy and hold.  We've highlighted thoughts from Sternlicht before in investing lessons learned from Richard Rainwater.


Johnathan Gray (Blackstone):  They bought a lot of commercial real estate near the top of the market but said it's not painful because rents are improving (due to lack of new construction).  He believes there's some opportunity out there to buy things that others aren't interested in.  The caveat, is that financing is harder to obtain than in the past.

Blackstone obviously likes Ackman's notion of buying homes as that's what they've been doing.  Two thousand for $300 million, saying execution is key.  He especially seems to like European deals and thinks the continent is not going into an abyss.  In summary, he wants to buy hard assets at a discount to replacement cost.


Be sure to check out more insights from top investors from the conference:

- Best ideas panel

- Global opportunities panel

- Chase for yield panel

Bill Ackman's Pershing Square Cleared To Take Stake in Procter & Gamble (PG)

Bill Ackman's hedge fund firm Pershing Square Capital Management looks as though they're taking a stake in Procter & Gamble (PG).  The Federal Trade Commission (FTC) cleared Pershing to take a stake in the company via this page on their site.

There's no way to know how big Pershing's investment is/will be.  We'll have to wait until SEC filings for clarification.  However, this would be a new stake for the firm.  In Pershing Square's Q1 letter, Ackman said that they had identified their latest investment but declined to name it at the time.  It seems as though PG is the mystery candidate.

The logical play here given Ackman's style would be to break-up the company, but with no formal plans announced we'll have to wait and see.  Ackman already has activist investments in Canadian Pacific (CP) and J.C. Penney (JCP) so it will be interesting to see how many corporate campaigns he can take on at once.

Per Google Finance, Procter & Gamble is "focused on providing consumer packaged goods. The Company’s products are sold in more than 180 countries primarily through mass merchandisers, grocery stores, membership club stores, drug stores and high-frequency stores, the neighborhood stores, which serve many consumers in developing markets."

For more on this manager, we just yesterday posted Bill Ackman's recommended reading list.

Warren Buffett & Berkshire Hathaway's Latest Portfolio: 13F Filing (Q1 2010)

(This post is part of our series on tracking hedge fund portfolios. If you're unfamiliar with tracking investments they disclose via SEC filings, check out our series preface on hedge fund filings.)

Next up in our coverage is the Oracle of Omaha himself, Warren Buffett. From his original Buffett Partnerships to present day Berkshire Hathaway, Warren Buffett has invested his way to the third richest person in the world according to Forbes' billionaire list. He needs no introduction so let's dive right into it. Our recent coverage of Buffett's company includes some notes from Berkshire Hathaway's annual meeting as well as Berkshire's annual letter. And of course to learn to invest like one of the greatest out there, head to Warren Buffett's recommended reading list. The positions listed below were Berkshire Hathaway's long equity, note, and options holdings as of March 31st, 2010 as filed with the SEC. All holdings are common stock unless otherwise denoted:


Brand New Positions
n/a


Increased Positions
Republic Services (RSG): Increased position by 30.6%
Becton, Dickinson & Co (BDX): Increased by 16.3%
Iron Mountain (IRM): Increased by 11.35%


Reduced Positions
Kraft Foods (KFT): Reduced by 22.8%
Gannett (GCI): Reduced by 20.98%
Costco (COST): Reduced by 17.5%
M&T Bank (MTB): Reduced by 17.1%
Johnson & Johnson (JNJ): Reduced by 12%
Procter & Gamble (PG): Reduced by 9.6%
Conoco Phillips (COP): Reduced by 9.37%
Carmax (KMX): Reduced by 3.43%
Moody's (MCO): Reduced by 3% (we detailed these sales back when they occurred)


Positions With No Change
American Express (AXP)
Bank of America (BAC)
Coca Cola (KO)
Comcast (CMCSA)
Comdisco Holdings (CDCO)
Exxon Mobil (XOM)
General Electric (GE)
GlaxoSmithKline (GSK)
Home Depot (HD)
Ingersoll-Rand (IR)
Lowe's (LOW)
Nalco Holding (NLC)
Nestle (NSRGY)
Nike (NKE)
Sanofi Aventis (SNY)
Tiffany & Co (TIF)
Torchmark (TMK)
US Bancorp (USB)
USG (USG)
United Parcel Service (UPS)
WalMart (WMT)
Washington Post (WPO)
Wells Fargo (WFC)
Wesco (WSC)


Positions They Sold Out of Completely
SunTrust Bank (STI)
Travelers (TRV)
UnitedHealth (UNH)
Wellpoint (WLP)


Top 15 Holdings (by percentage of assets reported on the 13F filing)

1. Coca Cola (KO): 21.6%
   
2. Wells Fargo (WFC): 19.56%
   
3. American Express (AXP): 12.28%
4. Procter & Gamble (PG): 9.83%
5. Kraft Foods (KFT): 6.34%
6. Wesco Financial (WSC): 4.32%
7. Walmart (WMT): 4.26%
8. US Bancorp (USB): 3.51%
9. Conoco Phillips (COP): 3.43%
10. Johnson & Johnson (JNJ): 3.06%
11. Moody's (MCO): 1.80%
12. Washington Post (WPO): 1.51%
13. Nike (NKE): 1.10%
14. M&T Bank (MTB): 0.87%
15. Republic Services (RSG): 0.62%
    

It's somewhat rare to see Buffett's Berkshire completely sell out of a position, but this time around he sold multiple holdings in health plays Wellpoint (WLP) and UnitedHealth (UNH). His removal of WLP is intriguing because as you'll see from some of our soon-to-come 13F analyses, many hedge funds still own shares. Buffett also sold partial positions in Procter & Gamble (PG) and Kraft Foods (KFT). Berkshire Hathaway also added to positions in Republic Services (RSG), Becton Dickinson & Co (BDX), as well as Iron Mountain (IRM). RSG was their most sizable increase. Overall, quite a bevy of portfolio activity out of Berkshire Hathaway (at least more than we're used to seeing). As always, to become a great investor like the Oracle of Omaha himself, we point you to as Warren Buffett's recommended reading list. Lastly, those of you wondering about Berkshire Hathaway's future can head to Buffett's thoughts on succession planning.

Data used for this article comes from Alphaclone, our source for sorting through all the hedge fund portfolio movement and backtesting the performance (Market Folly readers can receive a special free 30 day trial). Assets reported on the 13F filing were $50.9 billion this quarter. Remember that these filings are not representative of the investment fund's entire base of AUM. This post is part of our hedge fund portfolio tracking series and we've already detailed the portfolio of Seth Klarman's Baupost Group. Be sure to check back daily for new hedge fund updates.

Brett Barakett's Tremblant Capital Bets Big On Research In Motion (RIMM): 13F Filing

(This post is part of our series on tracking hedge fund portfolios. If you're unfamiliar with tracking investments they disclose via SEC filings, check out our series preface on hedge fund 13F filings.)

Next up is Brett Barakett's hedge fund Tremblant Capital Group. Before founding his own firm, Brett previously was a portfolio manager for Louis Bacon's global macro hedge fund Moore Capital. Taken from their site, Tremblant Capital Group's objective is "to achieve superior risk adjust returns for our investors through our focused and disciplined investment process." The name Barakett might ring a bell because his brother Timothy used to run fellow hedge fund Atticus Capital (who previously announced they'd be shutting down). So while Timothy may have stepped away from the hedge fund game, Brett is still going at it. And, in his spare time he enjoys ice hockey.

The positions listed below were their long equity, note, and options holdings as of December 31st, 2009 as filed with the SEC. All holdings are common stock unless otherwise denoted.


Brand New Positions
Mastercard (MA) Calls
Macys (M) Calls
Chipotle Mexican Grill (CMG)
Macys (M)
Liberty Media Starz (LSTZA)
CVS Caremark (CVS)
Citigroup (C)
The rest of their new stakes were less than 0.5% of reported assets each: Apollo Group (APOL) Calls, Lowe Companies (LOW), AGA Medical (AGAM), DirecTV (DTV), Symmetry Medical (SMA), Union Pacific (UNP) Calls, Greatbatch (GB), Liberty Media (LINTA) Calls, America Movil (AMX), Apollo Group (APOL) Puts, Cypress Semiconductor (CY), Gannett (GCI) Calls, & Liz Claiborne (LIZ)


Increased Positions
Research in Motion (RIMM) Calls: Increased by 312%
Procter & Gamble (PG) Calls: Increased by 107%
Charles Schwab (SCHW): Increased by 37.9%
Hologic (HOLX): Increased by 20.5%
Green Mountain Coffee Roasters (GMCR): Increased by 13.6%
Integra Lifesciences (IART): Increased by 13%


Reduced Positions
Walmart (WMT): Reduced by 33%
Visa (V): Reduced by 32%
Apple (AAPL): Reduced by 26%
Mastercard (MA): Reduced by 25%
Procter & Gamble (PF): Reduced by 20%
Redhat (RHT): Reduced by 11.3%


Removed Positions (Sold out completely):
Qualcomm (QCOM) Calls
Chipotle (CMG-B)
DirecTV (DTV) Calls
Redhat (RHT) Calls
Liberty Media (LMDIA)
CBS (CBS) Puts
Viacom (VIA-B) Puts
Palm (PALM) Puts
The rest of their sold positions were less than 0.5% of assets reported on previous filings each: iShares HongKong (EWH) Puts, Intuitive Surgical (ISRG) Calls, iShares FTSE (FXI) Puts, Werner (WERN) Calls, Baidu (BIDU) Puts, Lamar Advertising (LAMR) Calls, Corporate Executive Board (EXBD) Calls, Burlington Northern (BNI), Peet Coffee (PEET), & China Biotics (CHBT)


Top 15 Holdings by percentage of assets reported on 13F filing

1. Research in Motion (RIMM) Calls: 28%
   
2. Procter & Gamble (PG) Calls: 8.37%
   
3. Procter & Gamble (PG): 3.34%
   
4. Visa (V): 2.15%
   
5. Mastercard (MA): 2.13%
   
6. Mastercard (MA) Puts: 2.09%
   
7. Research in Motion (RIMM): 1.98%
   
8. Mastercard (MA) Calls: 1.97%
   
9. Green Mountain Coffee Roasters (GMCR): 1.91%
   
10. Hologic (HOLX): 1.91%
    
11. Macys (M) Calls: 1.86%
    
12. Baidu (BIDU): 1.67%
    
13. Walmart (WMT): 1.65%
    
14. Apple (AAPL): 1.64%
    
15. Charles Schwab (SCHW): 1.63%
    

Tremblant Capital uses options to express a lot of their positions so keep in mind that this can get tricky when trying to assess their net exposure to a specific stock. For instance, they own Mastercard (MA) common stock, but also own both calls and puts on the name. Since we don't know the strike prices or expiration dates, it's nearly impossible for us to know what their overall bet is on the name. At the same time though, we know they are bullish on Research in Motion (RIMM) because they own both the common stock and and calls. Not to mention, they added massively to their call position over the past quarter.

In terms of other additions, they doubled their stake in Procter & Gamble (PG) calls and started new call positions in both Macys and Mastercard. Of the positions they completely sold out of, Qualcomm was notable because it had previously been a sizable stake for Barakett's hedge fund. Overall though, their portfolio looks pretty similar to last quarter and they've certainly retained (and even expanded) their large exposure to Research in Motion.

There are also a few transactions we need to clarify. In regards to their Chipotle positions, you'll notice they "sold out" of Chipotle's B shares and added a 'new' stake in Chipotle's A shares. In actuality, Chipotle converted into a single shareclass of common stock in the fourth quarter. As such, Tremblant owns the regular CMG shares. In addition, Barakett's hedge fund 'sold out' of LMDIA and started 'new' stakes in DTV and LSTZA. In reality, this was just a result of a merger transaction.

Assets reported on the 13F filing were $3.8 billion this quarter compared to $3.0 billion last quarter, an increase of 28% in exposure to equities and options. Remember that these filings are not representative of the hedge fund's entire base of AUM.

We'll be tracking 40+ prominent funds in our fourth quarter 2009 hedge fund portfolio tracking series. We've already covered Seth Klarman's Baupost Group, Mohnish Pabrai's Investment Fund, Carl Icahn's hedge fund Icahn Partners, David Einhorn's Greenlight Capital, Stephen Mandel's Lone Pine Capital, John Griffin's Blue Ridge Capital, David Tepper's Appaloosa Management, Warren Buffett's portfolio, John Paulson's hedge fund Paulson & Co, Lee Ainslie's Maverick Capital, Dan Loeb's Third Point, Eddie Lampert's RBS Partners, David Ott's Viking Global, and Chris Shumway's hedge fund Shumway Capital Partners, Chase Coleman's Tiger Global, Philip Falcone's Harbinger Capital Partners, Roberto Mignone's Bridger Management, Thomas Steyer's Farallon Capital, and John Burbank's Passport Capital. Check back daily for our new updates.

Warren Buffett's Portfolio: Fourth Quarter 13F Filing

(This post is part of our series on tracking hedge fund portfolios. If you're unfamiliar with tracking investments they disclose via SEC filings, check out our series preface on hedge fund 13F filings.)

Warren Buffett needs no introduction. Seriously. If you don't know who he is, you shouldn't even be reading this.

Through his early Buffett partnerships to the modern days of Berkshire Hathaway (BRK.A), he is regarded as one of the most successful investors ever. While many would argue that Baupost Group's Seth Klarman could give Buffett a run for his money, Buffett has garnered quite a massive following due to his enormous returns over time. Needless to say, investors are always anxious to find out what he has bought or sold, and that's exactly what we're here to do today. To learn to invest like the legend himself, head to Warren Buffett's recommended reading list.

The positions listed below were Berkshire Hathaway's long equity, note, and options holdings as of December 31st, 2009 as filed with the SEC. All holdings are common stock unless otherwise denoted.


Brand New Positions
n/a


Increased Positions
Republic Services (RSG): Increased by 128.7%
Iron Mountain (IRM): Increased by 107.6%
Beckton Dickinson (BDX): Increased by 25%
Walmart (WMT): Increased by 3.2%
Wells Fargo (WFC): Increased by 2.2%


Reduced Positions
Exxon Mobil (XOM): Reduced by 67%
United Health Group (UNH): Reduced by 65.4%
WellPoint (WLP): Reduced by 60.4%
Gannett (GCI): Reduced by 36.1%
ConocoPhillips (COP): Reduced by 34.3%
Ingersoll Rand (IR): Reduced by 27.6%
Johnson & Johnson (JNJ): Reduced by 26.5%
SunTrust Banks (STI): Reduced by 22.1%
Moody's (MCO): Reduced by 18.9% ~ we've detailed all of his sales as they've happened
CarMax (KMX): Reduced by 11.1%
Procter & Gamble (PG): Reduced by 9.2%


Removed Positions (Sold out completely):
Union Pacific (UNP)
Norfolk Southern (NSC)
These were both sold due to conflict with Berkshire's impending acquisition of Burlington Northern.


Top 15 Holdings by percentage of assets reported on 13F filing

1. Coca Cola (KO): 19.7%
2. Wells Fargo (WFC): 14.9%
3. Burlington Northern Santa Fe (BNI): 13.1% ~ this won't show up in future filings
4. American Express (AXP): 10.6%
5. Procter & Gamble (PG): 9.2%
6. Kraft Foods (KFT): 6.5%
7. Walmart (WMT): 3.6%
8. Wesco Financial (WSC): 3.38%
9. ConocoPhillips (COP): 3.32%
10. Johnson & Johnson (JNJ): 3.02%
11. US Bancorp (USB): 2.68%
12. Moody's (MCO): 1.47%
13. Washington Post (WPO): 1.31%
14. Nike (NKE): 0.87%
15. M&T Bank (MTB): 0.78%
    

The name of the game for Warren Buffett was selling shares of other holdings in order to make way for their acquisition of Burlington Northern Santa Fe in its entirety. That massive purchase obviously will not show up in future filings and is Berkshire's largest purchase ever. Obviously when you're purchasing that large of an entity, you're not going to be buying much else. However, Buffett did also double down on his Iron Mountain and Repulic Services positions.

Buffett reduced 'health' holdings by selling over half of his UNH and WLP stakes. Additionally, he sold nearly 70% of his Exxon Mobil position. We've also covered Buffett's sales of MCO shares as they became somewhat frequent occurrences. It remains to be seen if those sales were more-so because Buffett felt the business was threatened or because he was trying to free up capital for his BNI acquisition. Buffett has maintained a large position in Kraft for a while now, but shares have been center stage as Bill Ackman's hedge fund Pershing Square recently acquired a large stake and the company recently sealed a deal to acquire Cadbury.

Keep in mind that there are also some positions that won't show up on the filing because they are non-equity stakes. Buffett acquired many of these during the heart of the crisis in 2008 and as such sealed these deals with ridiculously good terms (for him).

To hear some of Buffett's recent thoughts, we posted up his recent television interview. For analysis of Berkshire Hathaway (BRK.A / BRK.B), we noted that hedge fund T2 Partners deemed shares undervalued in their in-depth presentation. And lastly, make sure you check out Warren Buffett's recommended readings.

We'll be tracking 40+ prominent funds in our fourth quarter 2009 hedge fund portfolio tracking series. We've already covered Seth Klarman's Baupost Group, Mohnish Pabrai's Investment Fund, Carl Icahn's hedge fund Icahn Partners, David Einhorn's Greenlight Capital, Stephen Mandel's Lone Pine Capital, John Griffin's Blue Ridge Capital, and David Tepper's Appaloosa Management. Check back daily for our new updates.

Brett Barakett's Tremblant Capital: Large Research in Motion (RIMM) Exposure

This is the third quarter 2009 edition of our hedge fund portfolio tracking series. If you're unfamiliar with tracking hedge fund movements or SEC filings, check out our series preface on hedge fund 13F filings.

Next up in our series is Brett Barakett's hedge fund Tremblant Capital. The name Barakett might ring a bell because his brother Timothy used to run fellow hedge fund Atticus Capital (who recently announced they'd be shutting down). So while Timothy may have stepped away from the hedge fund game, Brett is still going at it. Before founding his own firm, Brett was previously a portfolio manager for Louis Bacon's hedge fund Moore Capital and in his spare time he enjoys ice hockey. Taken from their site, Tremblant Capital Group's objective is "to achieve superior risk adjust returns for our investors through our focused and disciplined investment process." The only major notable portfolio activity out of Tremblant has been their 13G filing on IMAX.

Keep in mind that the positions listed below were Tremblant's long equity, note, and options holdings as of September 30th, 2009 as filed with the SEC. We don't cover every single portfolio maneuver, as we instead focus on all the big moves. All holdings are common stock unless otherwise denoted.


Some New Positions
Brand new positions that they initiated last quarter:
Qualcomm (QCOM) Calls
Procter and Gamble (PG) Calls
Wynn Resorts (WYNN) Puts
Union Pacific (UNP) Puts
Monsanto (MON)
DirecTV (DTV) Calls
Apollo Group (APOL)
Viacom (VIA-B) Puts


Some Increased Positions
Positions they already owned but added shares to:
Imax Corp (IMAX): Increased position by 187.7% (we previously detailed this)
Mastercard (MA) Puts: Increased by 115.2%
Melco Crown (MPEL) Calls: Increased by 45.9%
Green Mountain Coffee Roasters (GMCR): Increased by 42%
Walmart (WMT): Increased by 38.5%
Cheesecake Factory (CAKE): Increased by 36%
Intel (INTC) Puts: Increased by 34%
Liberty Media (LINTA): Increased by 27.3%
Charles Schwab (SCHW): Increased by 24.6%


Some Reduced Positions
Stakes they sold shares in but still own:
Red Hat (RHT) Calls: Reduced by 70.2%
Apple (AAPL) Puts: Reduced by 63.7%
RedHat (RHT): Reduced by 45.7%
Google (GOOG): Reduced by 43.5%
Melco Crown (MPEL): Reduced by 35.7%
Icon (ICLR): Reduced by 35.7%
Eclipsys (ECLP): Reduced by 31.7%
Hologic (HOLX): Reduced by 29.8%
Baidu (BIDU): Reduced by 26.8%
Costco (COST): Reduced by 24.8%
Apple (AAPL): Reduced by 24.4%
Qualcomm (QCOM): Reduced by 22.2%


Removed Positions
Positions they sold out of completely:
Apple (AAPL) Calls
Amazon (AMZN) Puts
Qualcomm (QCOM) Puts
Canadian Natural Resources (CNQ)
AU Optronics (AUO) Puts
Hologic (HOLX) Puts
Catalyst Health (CHSI)
Research in Motion (RIMM) Puts
Symantec (SYMC)
Bankrate (RATE)
Weingarten Realty (WRI)
MGM Mirage (MGM) Calls
Las Vegas Sands (LVS) Calls
MEMC Electronics (WFR)
Wynn Resorts (WYNN) Calls
Gannett (GCI) Calls
Harley Davidson (HOG) Calls
Commscope (CTV)
Sequenom (SQNM)


Top 15 Holdings by percentage of assets reported on 13F filing

1. Research in Motion (RIMM) Calls: 8.7%
2. Qualcomm (QCOM) Calls: 5.43%
3. Procter and Gamble (PG): 5.08%
4. Procter and Gamble (PG) Calls: 4.94%
5. Visa (V): 3.21%
6. Walmart (WMT): 2.9%
7. Mastercard (MA): 2.87%
8. Research in Motion (RIMM): 2.7%
9. Apple (AAPL): 2.5%
10. Hologic (HOLX): 2.29%
11. Baidu (BIDU): 2.19%
12. Mastercard (MA) Puts: 2.12%
13. Melco Crown (MPEL): 2.08%
14. Visa (V) Calls: 1.97%
15. Green Mountain Coffee Roasters (GMCR): 1.95%
    

Tremblant was out reducing technology exposure across the board as it was previously almost 49% of their long US equity holdings. While they were moving out of that sector, they were moving into consumer goods as around 18% of their longs are in that sector now. The tough thing to decipher about their portfolio is their net position in a given name. As you can see above, they hold a bevy of puts and calls in addition to the underlying common in many stocks. As such, we do not have access to the strike prices or expirations of those options so it's hard to tell if they are net bullish or net bearish on some of their positions.

By far and away their largest position though is calls in Research in Motion (RIMM) and this carries over from the second quarter where it was their largest stake then as well. Their second largest holding is a brand new position in Qualcomm (QCOM) calls which is notable. So while they were reducing tech exposure, don't get us wrong... they definitely still have tech positions.

Below are some graphical illustrations of the changes made to Tremblant Capital's portfolio courtesy of Drew Robertson at Financial Research Station:

(click to enlarge)

(click to enlarge)

Assets from the collective holdings reported to the SEC via 13F filing were $3 billion this quarter compared to $2.7 billion last quarter. Please keep in mind that when we state "percentage of portfolio," we are referring to the percentage of assets reported on the 13F filing. Since these filings only report longs (and not shorts or cash positions), the percentages are skewed. Also, please again note that these positions were as of September 30th so two months have elapsed and they've undoubtedly shifted around their portfolio since then.

This is just one of the 40+ prominent funds that we'll be covering in our Q3 2009 hedge fund portfolio series. We've already covered Seth Klarman's Baupost Group Bill Ackman's Pershing Square, Stephen Mandel's Lone Pine Capital, Dan Loeb's Third Point LLC, David Einhorn's Greenlight Capital, John Paulson's firm Paulson & Co, Lee Ainslie's Maverick Capital, Andreas Halvorsen's Viking Global, and Chase Coleman's Tiger Global. Check back daily as we'll be covering new hedge fund portfolios.