Graham & Doddsville Fall 2018 Issue: Tweedy Browne, Greenhaven Road & More

Columbia Business School has just released the Fall 2018 issue of its Graham & Doddsville newsletter.  In it, they interview members of Tweedy, Browne Company such as Roger De Bree, Andrew Ewert, Frank Hawrylak, Jay Hill, Amelia Koh, Tom Shrager, John Spears, and Bob Wyckoff.  They also interview Scott Miller of Greenhaven Road Capital.

Additionally, the issue also includes student investment pitches such as long JD.com (JD) and long Qorvo (QRVO)


Tweedy Browne Buys Baidu, Sina, AutoZone

Tweedy recently bought some Chinese equities: search engine giant Baidu (BIDU) and Sina (SINA), which owns Weibo, a popular social media business.  They like the profitable advertising business models but have smaller position sizes due to various risks.

Domestically, Tweedy also purchased shares of AutoZone (AZO):  "If you lookover the previous 11-yearperiod, its intrinsic value grew by 16% per annum, with a significant percentage of that growth driven by share buybacks. The historical record also revealed a stable and defensive business. Same store sales at AutoZone have grown in 19 out of the last 20 years, including in 2008 and 2009.AutoZone has also historically produced high returns, with a 14% ROA (return on assets) and a roughly 30% lease adjusted ROIC (return on invested capital)."


Greenhaven Road Long Etsy, Fiat, Yelp

Greenhaven Road's founder talks about his positions in Etsy, (ETSY), Fiat Chrysler (FCAU) and Yelp (YELP). 

On Fiat, he notes: "Fiat Chrysler is reducing the low margin fleet business by getting out of sedans and focusing on SUVs, aligning themselves with customer preferences and higher margins.They are also going to either spin off or sell their parts division. If you backout the parts business, you're getting the core business for less than 3x earnings excluding net industrial cash and the parts business. That’s an attractive multiple for a growing earnings stream and a business that should remain profitable even if US new car sales decline by 30%."

Graham & Doddsville New Fall 2018 Issue

Embedded below is the new issue:



You can download a pdf copy here.

What We're Reading ~ 10/3/2018

The decision matrix: how to prioritize what matters [Farnam Street]

Sustainable sources of competitive advantage [Collaborative Fund]

Deep dive on wireless future: 5G [Axios]

How Shopify is the platform powering the direct-to-consumer revolution [Digiday]

Why Google Fiber is high-speed internet's most successful failure [HBR]

Pulling back the curtain on how SoftBank's massive Vision Fund works [TechCrunch]

A pitch on Yelp [Barrons]

Inside the world's fastest growing food delivery service [Eater]

Food delivery apps are impacting your favorite restaurants [Democrat & Chronicle]

How seltzer/sparkling water is upending coffee and beer [WSJ]

App-only banks rise in Europe and aim at traditional banks [NYTimes]

For some platforms, network effects are no match for local know-how [HBR]

David Rubenstein interviews Amazon's Jeff Bezos [YouTube]

How TripAdvisor changed travel [The Guardian]

The $29 billion battle to own how America sleeps [Fast Company]

How Paytm clinched its Berkshire Hathaway investment [Economic Times]

'Peak car' and the end of an industry [Bloomberg]

Eminence Capital Discloses Yelp Position

Ricky Sandler's hedge fund firm Eminence Capital has filed a 13G with the SEC regarding shares of Yelp (YELP).  Per the filing, Eminence now owns 5.1% of the company with over 3.32 million shares.

This is a newly disclosed equity position for the hedge fund as they did not own any YELP shares as of the end of the first quarter.  The filing was made due to portfolio activity on May 15th.

For more from this hedge fund, head to Eminence Capital's other recent activity.

Per Google Finance, Yelp "connects people with local businesses. The Company’s users have contributed a total of approximately 52.8 million cumulative reviews of almost every type of local business, from restaurants, boutiques and salons to dentists, mechanics and plumbers. Its platform provides local businesses with a range of free and paid services, which help them to engage with consumers at moment when they are deciding where to spend their money."

John Burbank's Passport Capital Starts Yelp Stake

John Burbank's hedge fund firm Passport Capital filed a 13G with the SEC revealing a brand new position in Yelp (YELP).  Passport now owns 6.3% of the company with 1,065,261 shares.  They filed with the SEC due to portfolio activity on January 25th.

Just a few weeks ago, we highlighted how Robert Karr's Joho Capital had been adding to its YELP stake as well, as hedge funds have been buying shares.

Per Google Finance, Yelp "operates a directory services and social networking website. Its online community provides information on urban city guide. The Company is based in the United States and its information helps people to find places to eat, shop, drink, relax, and play. It also operates a search engine for finding restaurants, dentists and hairstylists. It provides a space for feedbacks and reviews of people regarding their experiences with local businesses and services."

For more on this hedge fund, we've posted up previous Passport Capital portfolio activity here.

Robert Karr's Joho Capital Adds to Yelp, Reduces 21Vianet Group Stake

Robert Karr's hedge fund firm Joho Capital recently filed a few amended 13G's regarding their positions in Yelp and 21Vianet Group.


Yelp (YELP):  Joho bought more YELP per a 13G filed with the SEC and now own 974,795 shares as of December 31st.  This marks around a 9% increase in their position size since the middle of December, when they originally initiated their YELP stake.

Per Google Finance, Yelp is "operates a directory services and social networking website. Its online community provides information on urban city guide. The Company is based in the United States and its information helps people to find places to eat, shop, drink, relax, and play."


21Vianet Group (VNET):  Per an amended 13G filed with the SEC, Karr's firm now owns 1,799.206 shares of VNET.  The filing was made due to portfolio activity on December 31st and marks only a slight decrease in their overall position size (around -16%).

Per Google Finance, 21Vianet Group "operates as an Internet Service Provider (ISP). The Company operates as an ISP service supplier in China. Its main business includes Internet Data Center (IDC) service, Content Delivery Network (CDN), Enterprise Data Center (EDC) service and Data Center based industry solutions."

Robert Karr's Joho Capital Starts Yelp Position

Robert Karr's hedge fund Joho Capital filed a 13G with the SEC regarding shares of Yelp (YELP).  Per the filing, Joho has disclosed a 5.26% ownership stake in YELP with 894,795 shares.  Joho is one of the 'Tiger Cub' hedge funds as Karr previously worked at Julian Robertson's Tiger Management.

This is a brand new position for Joho Capital as they did not report a stake at the end of the third quarter on their most recent 13F filing with the SEC. The new 13G disclosure was required due to portfolio activity on December 7th.

Per Google Finance, Yelp is "operates a directory services and social networking website. Its online community provides information on urban city guide. The Company is based in the United States and its information helps people to find places to eat, shop, drink, relax, and play. It also operates a search engine for finding restaurants, dentists and hairstylists. It provides a space for feedbacks and reviews of people regarding their experiences with local businesses and services."

It's also worth pointing out that Yelp has recently been integrated into Apple's iOS platform via their maps application, allowing users to locate, rate, and review attractions. 

This integration could be a part of Joho's attraction to the name, in addition to the fact that shares have dropped from $23 down to $18 in recent months and have traded as low as $16.30.

For more on this hedge fund, we've also revealed one of Joho's short positions.

Steve Cohen's Hedge Fund Has Been Buying These 10 Stocks

Steve Cohen's hedge fund SAC Capital has been busy filing 13G's with the SEC the past few days.  In total, they've filed ten different times.  Cohen was named one of the top 25 highest earning hedge fund managers of 2011.  Here's his fund's latest activity:


1. Sequenom (SQNM) - The hedge fund has boosted its holdings in SQNM by quite a large margin since the end of last year.  They now own 5.4% of the company with 6,128,919 shares. This is due to portfolio movement on May 7th.

Per Google Finance, Sequenom is "a diagnostic testing and genetics analysis company. The Company is focused on providing products, services, diagnostic testing, applications and genetic analysis products that translate the results of genomic science into solutions for biomedical research, translational research, molecular medicine applications, and agricultural, livestock and other areas of research."


2. Zillow (Z) - This is a brand new position for SAC Capital as they did not report a stake in their last disclosure at the end of 2011.  They now own 5% of Zillow with 1,011,501 shares due to activity on May 7th.

Per Google Finance, Zillow is "a real estate information marketplace. The Company provides information about homes, real estate listings and mortgages, through its Website and mobile applications, enabling homeowners, buyers, sellers and renters to connect with real estate and mortgage professionals."


3. Western Refining (WNR) - SAC Capital has increased its stake by a whopping 287% since the beginning of the year.  They now own a 5.4% ownership stake in the company with 4,860,883 shares due to activity on May 4th.

Per Google Finance, Western Refining is "an independent crude oil refiner and marketer of refined products and also operates service stations and convenience stores. WNR operates in three business segments: the refining group, the wholesale group, and the retail group."


4. Yelp (YELP) - The company completed its initial public offering at the beginning of March this year and this is a brand new position for Cohen's hedge fund.  They now own 415,847 shares, or 5.1% of the company.  They were required to file a disclosure due to crossing a regulatory threshold in trading on May 4th.

Per Google Finance, Yelp "connects people with local businesses. Its users contribute reviews of every type of local business, from restaurants, boutiques and salons to dentists, mechanics and plumbers. Its platform provides local businesses with a range of free and paid services, which help them to engage with consumers at moment when they are deciding where to spend their money."


5. Movado Group (MOV) - SAC Capital now owns 5.11% of Movado Group as they've built a position of 943,890 shares.  They only owned a tiny 11,347 share position at the end of 2011 so they've certainly ratcheted up their stake this year.

Per Google Finance, Movado "designs, sources, markets and distributes fine watches. The Company’s portfolio of brands consists of Movado, Ebel, Concord, ESQ, Coach Watches, HUGO BOSS Watches, Juicy Couture Watches, Tommy Hilfiger Watches and Lacoste Watches. The Company operates in two segments: Wholesale and Retail."


6. Accretive Health (AH) - This stake has been increased since their last disclosure and SAC now owns 5% of the company with 5,005,600 shares due to activity on May 4th.

Per Google Finance, Accretive Health is "a provider of services to the healthcare providers. The Company’s three offerings are revenue cycle management; quality and total cost of care, and physician advisory services. Its integrated revenue cycle management service offering helps the United States healthcare providers to manage their revenue cycles, which encompass patient registration, insurance and benefit verification, medical treatment documentation and coding, bill preparation and collections."


7. Walter Energy (WLT) - The hedge fund disclosed ownership of 3,143,160 shares of WLT due to trading activity on May 3rd.  They now own 5% of the company and have boosted their holdings by around 30% since the end of 2011.

Per Google Finance, Walter Energy is "a producer and exporter of metallurgical coal for the global steel industry and also produces steam coal, coal bed methane gas (natural gas), metallurgical coke and other related products."


8. Santarus (SNTS) - Cohen's firm started a new position in Santarus and now own 3,231,392 shares, or 5.2% of the company.

Per Google Finance, Santarus is "a specialty biopharmaceutical company focused on acquiring, developing and commercializing products that address the needs of patients treated by physician specialists."


9. Clearwater Paper (CLW) - This position is slightly different in that SAC filed an activist 13D on the name.  As of the beginning of May, they now own 1,640,000 shares (or 7.2% of the company).  In recent trading, they were out purchasing shares on April 26th, 27th, and 30th at prices in the high $32.xx and low $33.xx.

The hedge fund feels that Clearwater would be worth more if it split up.  They feel that the sum of the parts are worth more separate than in their current combined entity.  SAC portfolio manager David Rosen wrote a letter to the company as SAC is currently the third largest shareholder.

They feel that the company's consumer products division is worth between $990 million and $1.4 billion.  They argue that the pulp and paperboard division is worth $770 million to $960 million.  But as of recent trading, Clearwater's entire market cap is only $786 million.


10. Select Comfort (SCSS) -SAC Capital now owns 5.02% of Select Comfort (SCSS) with 2,848,996 shares.  At the end of 2011, they only held a tiny position so they've boosted their holdings by over 1,500% since then.

Per Google Finance, Select Comfort is "a bed manufacturer and retailer. The Company designs, manufactures, markets and distributes the SLEEP NUMBER bed and other sleep-related products. The Sleep Number bed features DualAir technology, which allows couples to adjust each side of the mattress to his or her level of firmness."


And if you missed it, we've posted up even more of SAC Capital's portfolio activity here.