John Thaler's JAT Capital Starts Angie's List Stake

John Thaler's hedge fund JAT Capital has disclosed a new stake in Angie's List (ANGI), per a 13G filed with the SEC.  JAT has revealed they own 5.5% of ANGI with over 3.1 million shares.  The filing was required due to activity on February 3rd.

Angie's List has been a popular short target among other hedge funds, so it seems they've taken a variant viewpoint.  JAT's primary focus has always been on the TMT sectors and Thaler launched his fund after previously working at Shumway Capital.

Per Google Finance, Angie's List is "operates a consumer-driven service for members to research, hire, rate and review local professionals for critical needs, such as home, health care and automotive services."

York Capital Reduces Gilat Satellite Networks Position

Jamie Dinan's hedge fund firm York Capital has filed an amended 13D with the SEC regarding their position in Gilat Satellite Networks (GILT).  Per the filing, York has disclosed a 14.3% ownership stake in the company with just over 6 million shares of GILT.

This means they've reduced their position size by over 2.1 million shares since the end of the third quarter.  The filing was required due to activity on February 3rd. 

The reason for the transaction is that York entered into an agreement with FIMI Opportunity Fund to sell them over 2.1 million shares for over $10.5 million.

York has been a longtime holder of Gilat, previously owning debt that they converted into stock.

Per Google Finance, Gilat Satellite Networks is "a provider of Internet protocol (IP)-based digital satellite communication and networking products and services. Gilat designs, produces and markets very small aperture terminals (VSATs) and related network equipment, such as power amplifiers and antennas. The Company operates in three businesses: Gilat Worldwide, which consists of Gilat International and Gilat Peru & Colombia; Spacenet Inc. (Spacenet), and Wavestream Corporation (Wavestream)."

For more on this hedge fund, we posted up a rare interview with Jamie Dinan where he talked about York's positions.

London Value Investor Conference: Discount Code For Our Readers

Market Folly has secured a limited number of discounted tickets to the forthcoming London Value Investor Conference 2014, which will be supporting School Aid. 

This Conference is the largest gathering of Value Investors in Europe and has some of the world's leading investors speaking, including such well-known names as Mason Hawkins, Jonathan Ruffer, Donald Yacktman, Mason Morfit and Jon Moulton.  It is also a showcase for less well known and smaller firms.

£100 discount code: MARKETFOLLY22MAY

Click here to register


Event Details

When: Thursday, 22nd of May 2014
Where: Queen Elizabeth II Conference Centre


Speakers

- Mason Hawkins, Southeastern Asset Management
- Jonathan Ruffer, Ruffer LLP
- Donald Yacktman, Yacktman Asset Management
- Mason Morfit, ValueAct Capital
- Jon Moulton, Better Capital
- David Samra, Artisan Partners
- Aled Smith, M&G Global Leaders Fund
- Richard Rooney, Burgundy Asset Management
- Charles Heenan, Kennox Asset Management
- Philip Best and Marc Saint John Webb, Argos Investment Manager
- Andrew Hollingworth, Holland Advisors


The speakers will provide valuable insights into the methods and approaches that have made them successful, comment on the current investment climate and offer specific investment ideas.  A key feature of the conference is the 10-15 minutes dedicated to audience Q&A for each speaker, led by Richard Oldfield and David Shapiro.

Here's a quick video overview of last year's conference if you missed it:




In order to claim your special £100 discount on this conference, please use the code MARKETFOLLY22MAY when signing up here.

Senator Investment Group's Thesis on Air Products & Chemicals (Q4 Letter)

Alex Klabin and Doug Silverman's hedge fund Senator Investment Group has built a sizable position in Air Products & Chemicals (APD) in the fourth quarter, according to their Q4 letter.

We've previously highlighted how Bill Ackman's Pershing Square is long APD and now Senator has bought a stake as well.


Senator's Air Products & Chemicals Thesis

The hedge fund likes that the company is involved in an attractive business with significant barriers to entry and oligopoly-like qualities.  There's 5 suppliers of industrial gasses: APD, Praxair, Linde and Air Liquide, and Airgas.  

Senator writes,

"Air Products trades at 18.1x 2014 earnings, but only 12.7x recurring free cash flow, a more relevant metric given the stable, cash generative nature of the business.  Moreover, for the last few years, Air Products' earnings and cash flow potential have been depressed by large investments in growth projects that have yet to impact financial results."

They like that industrial gas businesses see the majority of their revenues linked to long-term contracts.

Senator notes Pershing's involvement as a positive as the company has ousted the CEO and added new directors to the board.  Senator thinks a new CEO could potentially be announced during the first quarter and will put in place a restructuring plan. 

They feel the company's cost cutting opportunity to be around $400 million or so ("5% of its cost base and 27% of trailing EBIT of $1.5 billion") and point to how competitor Praxair went through something similar in 2000.  The hedge fund's base case for Air Products assumes that a new CEO can capture half of that opportunity.

Senator believes the company could also reap the benefits of the capital investments they made in the past few years as plants come online.  They see $175 million of incremental EBIT from this by 2016, as well as $450 million of increment EBIT opportunity from 'unutilized' merchant gas sales.  Senator estimates earnings growth of 20% in both 2015/16.

Senator concludes,

"A new CEO, a focused board and a large, constructive shareholder will very likely bring about other value maximizing moves, such as the sale, spin or MLP conversion of Air Products' hydrogen pipelines and additional cash returns to shareholders through issuances of project-level debt. In terms of downside, we think the 2014 guidance from the current management is reasonable and translates into $8.70 of free cash flow per share.  In our view, it's hard to envision the shares trading for less than 11x FCF (or 10% downside from current levels) given the defensive characteristics of the business and the imminent announcement of a new CEO.  Over the next two years, we believe Air Products' shares could trade to 15x our $12 free cash flow estimate or $180 per share, implying close to 70% upside in a large cap, high-quality business."

For more on this hedge fund, we've posted some of Senator's other recent portfolio activity here.

Tybourne Capital Raises Mulberry Group Stake

Eashwar Krishnan’s hedge fund Tybourne Capital Management has disclosed a position in London listed Mulberry Group (LON: MUL).  Due to trading on January 29th, Tybourne now hold 4.3% of Mulberry’s voting rights. 

Mulberry Group is not a new position, as Tybourne appeared on Mulberry Group’s list of large shareholders with a 1.08% stake back in November of 2013.  Tybourne have clearly been out buying more shares since then. 


About Tybourne Capital

Eashwar Krishnan spent 12 years as a Managing Director and Senior Analyst at Lone Pine Capital. In 2007, he moved to Hong Kong to set up and manage Lone Pine’s operation in Asia.

He set up his own fund, Tybourne Capital, in 2012. Tybourne focuses mostly on equities in the consumer, financial and TMT sectors in Asia. Tybourne’s flagship fund returned 16.04% in 2013, its first full year of operation.

For more on Tybourne, we've previously posted up Krishnan's investment ideas from the Sohn London Conference.


About Mulberry Group

Per Google Finance, Mulberry Group is "a United Kingdom-based holding company. The Company is engaged in the design and manufacture or sourcing of luxury accessories, clothing and footwear and their subsequent sale through wholesale channels or its own stores and concessions in home and export markets. It operates in two segments: the Retail business and Design business. The Retail segment is engaged in the sale of Mulberry branded fashion accessories, clothing and footwear through a number of shops and department store concessions. The design segment includes brand management, marketing, product design, manufacture, sourcing and wholesale distribution for the Mulberry brand. It invests in design and development in order to develop and market accessory, clothing and footwear collections for Spring/Summer and Autumn/Winter each year."

What We're Reading ~ Analytical Links 2/5/13

M&A world: stacks of corporate cash looking for deals [All About Alpha]

Taking money off the table to diversify emotionally [Abnormal Returns]

Looking at annual trends in shareholder activism [Activist Insight]

Observations of individual stock returns 1983-2006 [Longboard]

Time Warner breaks out HBO results [Barrons]

Will Valeant overdose on acquisitions? [Herb Greenberg]

FCC chief tells Sprint chair he is skeptical of T-Mobile deal [Reuters]

Cable TV mogul looks to add Formula 1 to sports bag [NYPost]

Taking a look at Kinder Morgan [Glenn Chan]

Did Google really lose on its original Motorola deal? [Dealbook]

Nestle looking at selling even more assets? [Reuters]

Top destinations for foreign investment dollars [Business Insider]

Corvex & Soroban Expect to Increase Williams Companies Stake (13D Filing)

Keith Meister's activist hedge fund firm Corvex Management and Eric Mandelblatt's Soroban Capital have jointly filed an amended 13D with the SEC regarding their position in Williams Companies (WMB). 


Corvex/Soroban To Increase Williams Companies Stake

The filing details that the Hart Scott Rodino waiting period has expired and as such, "Corvex intend to promptly exercise their deeply in-the-money physically settled call options and Corvex and Soroban also expect to acquire additional shares, further increasing their beneficial ownership stake."

Per the 13D, the hedge funds have disclosed a 7.14% ownership stake in WMB with exposure to over 48.8 million shares.

That figure doesn't include their cash-settled swaps and options regarding an additional 19.2 million shares, so their aggregate exposure to the name can rise as high as 9.96% (with 68 million shares). And now we get word that they're likely to buy more.


Seeking Board Seats As Well

The filing indicates that the hedge funds want Mandelblatt and Meister to join the company's board, but they haven't been able to come to an agreement with the company.

We've previously posted about their Williams Companies stake earlier this year.

Per Google Finance, Williams Companies is "an energy infrastructure company focused on connecting North America’s hydrocarbon resource plays to markets for natural gas, natural gas liquids (NGLs), and olefins. Its operations span from the deepwater Gulf of Mexico to the Canadian oil sands. It operates in three segments: Williams Partners, Midstream Canada & Olefins and Other. Its interstate gas pipeline and domestic midstream interests are held through its investment in Williams Partners L.P. (WPZ). It owns the general-partner interest and a 70% limited-partner interest in WPZ. Williams also owns a Canadian midstream and domestic olefins production business, which processes oil sands off-gas and produces olefins for petrochemical feedstocks." 

For more additional recent portfolio activity from Corvex, click here.

Baupost Group Increases Idenix Pharmaceuticals Stake

Seth Klarman's hedge fund firm Baupost Group has increased its stake in Idenix Pharmaceuticals (IDIX) per an amended 13D and Form 4 filed with the SEC.

Per the filings, Baupost has disclosed a 35.38% ownership stake in IDIX with over 53.3 million shares.  This means they've added to their position size by more than 16.4 million shares since November when they also added to their Idenix stake.

The Form 4 details that Baupost acquired those shares at a price of $6.5 on January 31st.  This was part of a registered direct offering from the company that Baupost took part in.  They are the company's largest shareholder.

Per Google Finance, Idenix Pharmaceuticals is "a biopharmaceutical company engaged in the discovery and development of drugs for the treatment of human viral diseases with operations in the United States and France."

You can view other recent portfolio activity from Baupost here.

Odey Adds to Epistem Holdings Position

James Hanbury's Odey Absolute Return hedge fund has more than doubled its stake in London listed Biotechnology support company, Epistem Holdings (LON:EHP).

Due to trading on January 31st, Hanbury's fund increased their holding from 6.46% to 15.51%.  The Odey group of funds often share positions but in this case it looks as though Hanbury's fund is the sole owner.

Hanbury's fund also disclosed a new position in Wolfson Microelectronics last week.

Per Google Finance, Epistem Holdings is "a holding company. The Company is engaged in  provision of services to the biotechnology and pharmaceutical industries, covering pre-clinical   testing and gene biomarker and diagnostic services and the development of novel therapeutics for   partner companies. The trading activity of the Company is principally undertaken in the subsidiary   undertaking, Epistem Limited. The Company operates in three segments: Contract Research   Services, Personalized Medicine and Novel Therapies. Contract Research Services provides pre- clinical testing services. Personalized Medicine specializes in molecular measures of biological effect   and point of care molecular diagnostic testing. Novel Therapies is discovering key regulators of   epithelial stem cells.”

Lone Pine and SAC Capital Disclose Lumber Liquidators Stakes

Steve Mandel's hedge fund firm Lone Pine Capital and Steve Cohen's hedge fund turned family office SAC Capital have both filed 13G's with the SEC regarding Lumber Liquidators (LL).

Lone Pine has revealed a 7.9% ownership stake in LL with over 2.18 million shares.  The filing was required due to activity on January 23rd and is a brand new position for the hedge fund firm.

SAC Capital has revealed a 5% ownership stake in Lumber Liquidators with over 1.39 shares.  They previously owned a very small stake and they've boosted their holdings by over 1.3 million shares since the end of the third quarter. 

Per Google Finance, Lumber Liquidators is "retailer of hardwood flooring, and hardwood flooring enhancements and accessories. The Company offers an assortment of wood flooring, which includes prefinished domestic and exotic hardwoods, engineered hardwoods, unfinished hardwoods, bamboo, cork and laminates, as well as resilient flooring. Its flooring enhancements and accessories include moldings, noise-reducing underlay and adhesives. Lumber Liquidators and Bellawood are it brands. Its hardwood flooring products are available in various widths and lengths. It offers approximately 350 different flooring product stock-keeping units."

You can view additional portfolio activity from Lone Pine Capital here.

Bill Ackman's Pershing Square Trims Beam Position

Bill Ackman's hedge fund firm Pershing Square Capital Management has filed an amended 13D and a Form 4 with the SEC regarding their stake in Beam Inc (BEAM).

Per the 13D, Pershing Square has trimmed its position in BEAM by 7.3 million shares.  After the sale, they're still left with a stake of over 13.5 million shares, or 8.3% of the company.

The Form 4 indicates they sold 6 million shares on January 30th at a price of $83.28 and then they sold 1.3 million more shares on January 31st at a price of $83.36.

Beam Inc has received a $16 billion takeover offer from Suntory, or $83.50 in cash.  Perhaps Ackman is raising some cash to potentially deploy elsewhere since BEAM shares are now effectively a merger-arb play trading with a thin spread.

You can view more recent portfolio activity from Bill Ackman here.

Blue Ridge Capital Discloses Platform Specialty Products Position

John Griffin's hedge fund firm Blue Ridge Capital has filed a 13G with the SEC and disclosed a position in Platform Specialty Products (PAH).  Per the filing, Blue Ridge now owns 7.72% of the company with 8 million shares.

As we detailed previously, Bill Ackman also owns a PAH stake.  The company was formed to acquire companies and their first deal was MacDermid, a specialty chemicals manufacturer.  Shares of PAH are newly listed on the NYSE. 

It's unclear if Blue Ridge owned a stake in Platform Specialty Products before they listed on the NYSE like Ackman did.

You can view other recent portfolio activity from Blue Ridge Capital here.

Bridger Capital Boosts TG Therapeutics Stake

Roberto Mignone's hedge fund firm Bridger Capital has filed a 13G with the SEC regarding shares of TG Therapeutics (TGTX).  Per the filing, Bridger has disclosed a 7.1% ownership stake in TGTX with over 2.39 million shares.

This marks an increase of 894,132 shares since the end of the third quarter.  The filing was required due to activity on January 21st.

Per Yahoo Finance, TG Therapeutics is "a clinical-stage biopharmaceutical company, focuses on the acquisition, development, and commercialization of innovative and medically important pharmaceutical products for the treatment of cancer and other underserved therapeutic needs.."

Hound Partners Increases Carter's Position

Johnathan Auerbach's hedge fund Hound Partners has filed a 13G with the SEC regarding Carter's (CRI).  Per the filing, Hound has disclosed a 5.01% ownership stake in CRI with over 2.73 million shares.

This means they've added to their position by 289,815 shares since the end of the third quarter.  The filing was required due to activity on January 8th.

Hound is a 'Tiger Seed' as they were seeded by Tiger Management's Julian Robertson.  Fellow Tiger Seed hedge fund, Tiger Global, also added to their CRI stake a few months ago.

Per Google Finance, Carter's is "a branded marketer of apparel for babies and young children in the United States. The Company owns two brand names in the children’s apparel industry, Carter’s and OshKosh. Its Carter’s brand provides apparel for children sizes ranging from newborn to seven. OshKosh brand provides its line of apparel for children sizes newborn to 12. Its Carter’s, OshKosh, and related brands are sold to national department stores, chain and specialty stores and discount retailers."

Soros Fund Starts Polycom Stake

George Soros' hedge fund turned family office, Soros Fund Management, has filed a 13G with the SEC regarding Polycom (PLCM).  Per the filing, Soros now owns 6.95% of the company with over 9.4 million shares.

This is a brand new position for the firm and the filing was required due to portfolio activity on January 24th.

Per Google Finance, Polycom is "a provider of unified communications (UC) solutions and a provider of telepresence, video, voice and infrastructure solutions based on open standards. With Polycom RealPresence video and voice solutions, from infrastructure to endpoints, people all over the world can collaborate face-to-face without being in the same physical location. The Company has three operating segments: Americas, which consist of North, Central and Latin Americas; Europe, Middle East and Africa, and Asia Pacific. The products and solutions include Network Infrastructure, UC Group Systems and UC Personal Devices, which includes desktop video devices and wireless local area network products."

For more from Soros himself, head to George Soros' best investment advice.

2013 Hedge Fund Performance Numbers

Now that 2013 is over, we thought we'd aggregate how prominent hedge funds performed.  While some funds turned in solid numbers (Glenview & Appaloosa), others put in more marginal performances.

Some media members have bashed hedge fund performance, but it is worth noting that at least in the long/short equity segment this year, many of these funds captured 2/3rd's of the market upside while only being 30-40% net long.

After all, a true hedge fund is just that, hedged.  There's no question that short selling was tough in 2013 and by definition, many L/S hedge funds won't capture all the upside in big up years (like 2013).

As always, it's worth examining the entire picture (risk, exposure levels, etc) and the entire spectrum of returns.  Undoubtedly, there will be outperformers and underperformers.

Not to mention, it's probably more prudent to fixate on 3-year, 5-year, or even 10-year numbers anyways.  But in the short-term focused world, the 1-year performance number reigns.

The S&P 500 was up 29.6% in 2013.  Here's how prominent hedgies fared.


2013 Hedge Fund Performance Numbers


Glenview Capital Opportunity Fund: 84% (through end of Oct)

Appaloosa Palomino Fund: 42.1%

Bridgewater All Weather: -4%

Bridgewater Pure Alpha: 5.25%

Paulson Recovery: 63.18%

Paulson Advantage: 26.05%

Paulson Advantage Plus: 27.22%

Perry Partners: 20.25%

Pershing Square: 9.29%

Trian Partners: 40.06%

Owl Creek: 48%

Millennium: 13.07%

Visium Global: 16.93%

Eton Park: 22.3%

Children's Investment Fund: 47%

Theleme Partners: 19.41%

Whitebox MultiStrat: 18.09%

Lone Pine Cascade: 30.3%

Lone Pine Cypress: 18%

Lone Pine Dragon: 9.8%

Conatus Capital: 23.6%

Farallon: 15.3%

Matrix Capital: 56%

Elliott International: 11.6%

Discovery Global Opportunity: 27.5%

Marcato International: 26.16%

Luxor Capital: 17.6%

York Investment: 18.27%

Joho Capital: 29.46%

Lansdowne European Equity: 21.51%

Odey European: 25.78%

Kingdon Offshore: 23.69%

Passport Global: 18.98%

Passport LongShort: 19.89%

Passport Special Opportunities: 45.5%

Cobalt Offshore: 8.84%

Elm Ridge Capital: 22.28%

Eminence Capital: 14.64%

Highbridge LongShort: 15.34%

Ivory Capital: 17.07%

Ivory Enhanced Fund: 28.31%

Omega Advisors: 30.02%

Zweig-DiMenna: 17.33%

Greenlight Capital: 18.7%

Tosca Opportunity: 56%

JAT Capital: 30.6%

Tiger Global: 14%

Maverick Fund: 16.3%

Maverick Long: 32%

Hound Partners: 16%

Coatue Management: 20%

Viking Global Equities: 22.6%

Viking Long: 38.4%

Valinor Management: 23.4%

Glade Brook Capital: 19.76%

Falcon Edge Capital: 28%

Glenhill: 28.7%

Highfields Capital: 27.3%

Bridger Capital's Swiftcurrent Fund: 20.6%

White Elm Capital: 23.6%

MFP: 31.5%

Tybourne Capital: 16.04%

Fairholme: 33%

Jericho Capital: 33% (through end of Nov)

Beacon Light: 21.13%



2013 Credit Hedge Fund Performance

BlueCrest MultiStrat: 8.98%

BlueMountain LongShort Credit: 7.57%

Brevan Howard Credit Catalysts: 12.21%

Ellington Credit Opportunities: 15.55%

Kingdon Credit: 14.58%

Pine River Credit: 13.09%

Saba Capital: -3.61%

Canyon Value: 14.71%

Davidson Kempner: 19.98%

King Street: 11.43%

Monarch Debt Recovery: 16.12%

Paulson Credit Opportunities: 21.8%

Silver Point Capital Offshore: 15.88%



2013 Macro Hedge Fund Performance

Tudor BVI Global: 13.98%

Moore Global: 16.99%

Rubicon Global: 18.25%

Trend Macro: 11.88%





Sources: hedge fund performance reports, HSBC, II Alpha, WSJ, Bloomberg, NYMag

East Coast's Q4 Letter: Understanding the Mispricing of an Investment

Chris Begg's East Coast Asset Management is out with its 2013 year-end letter.  The Q4 missive walks further down their investment checklist.  Last quarter, we highlighted their letter on competitive advantage and this time they focus on understanding the mispricing of an investment

Through use of checklists, they categorize investment opportunities and identify the bull/bear cases, potential catalysts, long-term fundamentals, various sentiments, and more in order to understand what exactly is driving the mispricing.

This ties in with their concept of 'investment longitude' in that they want to understand the critical data points that truly drive the business (and the stock).  The letter below walks you through how to do so.

In terms of how East Coast has been positioning themselves, they've been shifting more of their portfolio toward 'transformation' plays, or companies benefiting from secular tailwinds.  Begg's letter also details how they purchased a European cable business in Q4.  While they don't specifically identify the position, it certainly sounds like John Malone's Liberty Global (LBTYA/LBTYK).

Embedded below is East Coast's Q4 letter: Navigating Beyond the Pillars:



For more on their investment checklists, head to East Coast's letter on competitive advantage.

Glenview Capital Updates Community Health Systems Stake

Larry Robbins' hedge fund Glenview Capital has filed an amended 13G and 13D with the SEC regarding their positions in Community Health Systems (CYH) and Health Management Associates (former ticker HMA).

On January 27th, CYH announced it had completed its acquisition of HMA.  As such, Glenview received over 2.6 million shares of CYH in exchange for its 37.7 million shares of HMA at an exchange rate of 0.06942 CYH shares per each share of HMA owned (and adjusted for cash received in lieu of the fractional shares).

As a result of this transaction, Glenview now owns over 12 million shares of CYH, or 10.67% of the company.

Glenview has bet big on hospitals and profited handsomely from their wagers as a whole.  For more portfolio activity from this hedge fund, click here.

What We're Reading ~ Analytical Links 1/29/13

On position sizing in long/short equity hedge funds [Aleph Blog]

Report on measuring a company's moat [Credit Suisse]

How to read a 10-K like Warren Buffett [CNBC]

The myth of maximizing shareholder value [Naked Capitalism]

The second most expensive stock market in the world [John Mauldin]

A look at Post Holdings [Brooklyn Investor]

Dow Chemical is no bargain [Capital Observer]

A long pitch on SSD makers [Minyanville]

Sprint met with US government re: possible T-Mobile deal, Justice Dept skeptical [WSJ]

How Vietnam became a coffee giant [BBC]

5 takeaways from the emerging markets rout of 2014 [WSJ]

Visa Europe says end of physical currency a 'reality' [Telegraph]

Apple making a move into mobile payments? [WSJ]

Google and Samsung reach global patent license deal [GigaOm]

Odey Starts Wolfson Microelectronics Stake

Crispin Odey's firm Odey Asset Management has disclosed a new position in London listed Wolfson Microelectronics (LON:WLF).

Due to trading on January 28th, Odey own the equivalent of 5.95% of Wolfson's voting rights.  The whole position is held via CFDs/derivatives.

James Hanbury's Odey Absolute Return hedge fund appears to be the main holder.

Per Google Finance, Wolfson Microelectronics is "a semiconductor company.  Wolfson is principally engaged in the design, manufacture and supply of high performance mixed- signal integrated circuits for the consumer electronics market. It segments include Audio Hubs and   Discrete and Power Products. Audio Hubs includes the supply and sale of Wolfson’s Audio Hubs   high performance audio integrated circuit solutions. Discrete and Power Products includes the   supply and sale of integrated circuits, which are discrete components, such as Analogue-to-Digital   Converters; Digital-to-Analogue Converters, This segment also includes those components which   are power management integrated circuits and the silicon microphone devices based on Micro- Electro-Mechanical Systems (MEMS) technology. The Company focuses on high definition (HD) audio   systems-on-chip (SoC), and noise reduction and sound enhancement software. During the fiscal year   ended January 1, 2012 (fiscal 2012), it acquired Dynamic Hearing Pty Ltd.”

You can view other recent portfolio activity from Odey here.

Marcato Capital Management Adds to Lear Position

Mick McGuire's activist hedge fund Marcato Capital Management has filed an amended 13D with the SEC regarding their stake in Lear (LEA).

Per the filing, Marcato now owns 7.9% of the company with over 6.4 million shares.  This means they've boosted their notional exposure by 750,000 shares since the end of the third quarter.

The fine print indicates they own call options representing 7.6 million shares at prices ranging from $40 to $90 per share and expiration dates ranging from June 2014 to August 2014.  They've also sold puts representing 7.6 million shares with exercise prices ranging from $40 to $65 and the same expiration dates.

The filing was required due to activity on January 23rd.  You can view the exact details of their recent trades here.

We previously highlighted how Marcato disclosed a Lear stake just slightly over a year ago.

Per Google Finance, Lear is "a tier 1 supplier to the global automotive industry. The Company supplies its products to automotive manufacturers with automotive seat systems and related components, as well as electrical distribution systems and related components. The Company has two segments: seating and electrical power management systems (EPMS). The seating segment includes seat systems and related components, such as seat frames, recliner mechanisms, seat tracks, seat trim covers, headrests and seat foam." 

MHR Fund Management Files 13D on Titan International

Mark Rachesky's hedge fund MHR Fund Management has filed a 13D with the SEC regarding Titan International (TWI).  Per the filing, MHR now owns 10.9% of the company with 5.84 million shares.

This is a newly disclosed position and the filing was made due to activity on January 9th.  The position is comprised of both common stock as well as $8.1225 July 2014 call options.

The 13D filing contains the standard boilerplate that MHR intends to seek discussions with management concerning the business and operations of the company.


About MHR Fund Management

If you're unfamiliar with this name, here's what you need to know:  prior to founding MHR Fund Management, Rachesky previously worked as a senior investment officer and managing director to Carl Icahn.  

Rachesky received his B.S. in molecular aspects of cancer from the University of Pennsylvania and an M.D. from Stanford University School of Medicine. Additionally, he also holds an MBA from the Stanford Graduate School of Business.



About Titan International

Per Google Finance, Titan International "through its subsidiaries, is engaged in the manufacturing of wheels and tires. The Company operates in three segments: agricultural, earthmoving/construction and consumer. Titan produces a range of specialty products to meet the specifications of original equipment manufacturers (OEMs) and aftermarket customers in the agricultural, earthmoving/construction and consumer markets. Titan’s earthmoving/ construction market includes wheels and tires supplied to the mining industry, while the consumer market includes products for all-terrain vehicles (ATVs) and recreational/utility trailers. The Company’s customers include AGCO Corporation, CNH Global N.V., Deere & Company and Kubota Corporation."

Corvex Management Starts Activist Signet Jewelers Position

Keith Meister's activist firm Corvex Management has filed a 13D with the SEC regarding Signet Jewlers (SIG).  Per the filing, Corvex now owns 7.8% of the company with over 6.2 million shares. 

This is a newly revealed stake and the filing was required due to activity on January 14th.  As has been customary with Corvex's other recent positions, they've bought both common stock and call options, as well as sold puts. 

It looks like they were buying November 2014 $53 calls and February 2015 $51 calls as well as selling November 2014 $53 puts and February 2015 $51 puts.


Activist Talks

The filing indicates Corvex has already talked with management and found talks to be "constructive." 

Corvex has approached Signet about "options for enhancing shareholder value through various strategic alternatives including, but not limited to, leveraging the Issuer's credit receivables, optimizing capital structure, accelerating M&A and/or return of capital to shareholders, utilizing the Issuer's offshore corporate structure, and general corporate matters."


About Signet Jewelers

Per Google Finance, Signet Jewelers is "a specialty retail jeweler by sales in the United States and United Kingdom, and also has stores in the Republic of Ireland and Channel Islands. The Company is engaged in the retailing of jewelry, watches and associated services. The business is managed as two geographical operating divisions: the US division and the UK division. Its stores trade nationally in malls and off-mall locations as Kay Jewelers (Kay), and regionally under a number of mall-based brands. Destination superstores trade nationwide as Jared The Galleria Of Jewelry (Jared)."

You can view more of Corvex's recent portfolio activity here.

Pershing Square Discloses Platform Specialty Products Stake

In a 13G filed with the SEC, Bill Ackman's hedge fund Pershing Square Capital Management has disclosed a 30.9% ownership position in Platform Specialty Products (PAH) with 33,333,332 shares. 

Ackman's position is broken down into over 28.1 million shares and over 4.1 million shares via October 2016 Warrants.  Pershing owns around 12.5 million warrants and every three warrants gives them the right to buy 1 share of common stock for $11.50.

Longtime followers of Pershing Square will know that this is not a new stake for the hedge fund, but they've disclosed it because PAH is newly listed on the NYSE.  The filing was made due to activity on January 23rd.

Platform was formed with the intent to acquire companies and their first deal was MacDermid, a specialty chemicals manufacturer for $1.8 billion.  Martin Franklin of Jarden (JAH), Nicolas Berggruen of Berggruen Holdings and Ackman's Pershing all own significant Platform stakes.

This isn't the first time Berggruen and Ackman have worked together, either.  While the Platform deal is a bit different, Ackman and Berggruen teamed up on Justice Holdings.  Justice then bought Burger King and relisted the stock, a position Ackman still held at the end of Q3.

Click here for more recent activity from Bill Ackman's fund.

What We're Reading ~ Hedge Fund Links 1/24/14

Where were the best performing hedge funds in 2013? [ai-cio]

JANA Partners targets Juniper, plans to close Nirvana Fund [II Alpha]

Tiger Global snaps up Alibaba shares at lofty valuation [USA Today]

A look at Joshua Resnick's Jericho Capital [II Alpha]

The world's biggest hedge fund had a pretty bad year [NYMag]

Michael Steinhardt is back and he's re-inventing investing again [Forbes]

A look at how Bruce Berkowitz's new hedge fund is doing [CNBC]

Why Bill Fleckenstein is (almost) ready to short stocks [Bloomberg]

For the love of the money [NYTimes]

The 13F spotlight: revealing and concealing hedge fund trades [FINalternatives]

Corsair Capital's Thesis on Alere (ALR): Q4 Letter

Jay Petschek and Steven Major's hedge fund Corsair Capital pitched Alere (ALR) in their Q4 letter.  They feel that the market still has a negative view toward the company despite numerous changes happening.

The company is involved with medical diagnostics and has a huge market share in 'point-of-care rapid tests used in hospitals, clinics and doctors' offices.'

Over the last ten years, the company went on an acquisition binge and basically failed to integrate them properly.  A proxy contest in 2013 led to changes and the company hired Namal Nawana from Johnson & Johnson as COO to change the culture and reduce costs.

Corsair thinks ALR is worth between $70-80 per share if it trades with a multiple in-line with other competitors.  ALR trades around $37 today.

They also note, "Furthermore, if the market doesn't come around and value this business properly, we wouldn't be surprised if, after restructuring the company, (the CEO) looks to sell the company as he did with IMA back in 2001."

Embedded below is Corsair Capital's Q4 letter with their pitch on Alere (ALR):




If you missed it, we've posted up Corsair's past letters as well.

Carl Icahn Pushes For eBay To Spinoff PayPal; Buys More Apple

Activist investor Carl Icahn has been busy yet again.  Firstly, he has disclosed a new position in eBay (EBAY) and he's pushing for the company to spin-off its fast growing PayPal segment.

This is not a new idea.  Plenty of analysts, sell-siders, and portfolio managers have voiced this sentiment before.  However, this might be the first time that a prominent activist has gotten involved and actually tried to make it happen.


Icahn's New eBay Stake

Icahn only owns 0.82% of the company and it looks like his activist push might already be dead on arrival.

Yesterday during eBay's earnings presentation, the company had one specific slide that highlighted why eBay and PayPal should remain together (seen here).

Then today, eBay's Chairman Pierre Omidyar (who owns 8% of the company) tweeted that he and the board were "fully aligned" that eBay and PayPal are best together.  Marc Andreessen tweeted the same.

As such, if Icahn wants to truly push for change, he'll perhaps need to drastically ramp up his ownership stake.  But as some investors have pointed out, perhaps his campaign has been more about awareness than activism.

Talking to Bloomberg, Icahn said he wants to get the word out to shareholders and if he can maybe get 51% of the shareholders to vote that they want it to happen, then maybe the board will take notice.  He did, however, acknowledge that it would be "difficult to convince management." He's also nominated two of his employees to eBay's board.

The video of Icahn's interview is embedded below:




Icahn Buys More Apple

The corporate activist also disclosed activity in another position of his.  This time, he took to Twitter to disclose that he had purchased $500 million more shares of Apple.  Icahn now owns over $3 billion worth of AAPL.

Icahn says that, "We feel (Apple's) board is doing great disservice to shareholders by not having markedly increased its buyback.  In-depth letter to follow soon."

Lee Cooperman Updates Position in Harbinger Group

Lee Cooperman of Omega Advisors has filed a 13G with the SEC regarding his position in Harbinger Group (HRG).

Omega Advisors previously held a stake in Harbinger Group as of the end of the third quarter.  Back then, they owned 6.5 million shares. 

Omega's 13G filed today seems to be updating that stake.  The filing indicates that as of September 26th, the hedge fund firm actually owned 7.6 million shares, or 5.3% of the company. 

Keep in mind that Harbinger Group's Chairman is fellow hedgie Phil Falcone of Harbinger Capital.

Per Google Finance, Harbinger Group is "a holding company. The Company's operations are conducted through Spectrum Brands, the Company's subsidiary, which provides branded consumer products, such as batteries, personal care products, small household appliances, pet supplies, and home and garden pest control products, and Fidelity & Guaranty Life Holdings, Inc. (FGL), its wholly owned indirect subsidiary, which provides life insurance and annuity products. In addition, Salus Capital Partners, LLC (Salus), the Company's wholly owned indirect subsidiary, is engaged in the business of providing secured asset-based loans across a range of industries, and Front Street Re Ltd (Front Street), its wholly owned indirect subsidiary provide reinsurance to the specialty insurance sector of fixed, deferred and payout annuities. The Company also own 97.9% of Zap.Com Corporation (Zap.Com)."

You can see some of Cooperman's more recent stock picks here from an interview.

Senator Investment Group Discloses Trade Street Residential Stake

Doug Silverman and Alex Klabin's hedge fund Senator Investment Group has filed a 13D and Form 3 with the SEC regarding their position in Trade Street Residential (TSRE).

This is a newly disclosed position for the hedge fund and they now own 25.6% of the company with over 9.3 million shares.  The filing was made due to activity on January 16th.

The fine print of the 13D indicates that Senator entered into a Standby Purchase Agreement (on November 12th, 2013) where they would purchase all of the unsubscribed shares of common stock in the issuer's $100 million rights offering to existing shareholders.

Senator also nominated one of their employees to the board of the company.

Per Google Finance, Trade Street Residential is "a full service, vertically integrated, self-administered and self-managed corporation focused on acquiring, owning, operating and managing garden-style and mid-rise apartment communities in mid-sized cities and suburban submarkets primarily in the southeastern United States, including Texas."

You can view some of Senator's past portfolio activity here.

What We're Reading ~ Analytical Links 1/22/14

Trading in the Zone: Maximizing Performance with Focus and Discipline [Ari Kiev]

On the 180 rule and shorting stocks [Dasan]

The bull case on Delta Airlines [SPBaines]

Shinzo Abe on Abenomics 2014 [Reformed Broker]

On why EV/EBITDA is the most effective measure [Greenbackd]

Expert argues now is the time to invest in Europe [FINalternatives]

On the correlation between returns and ridicule [AVC]

Where to find the biggest ideas for your business [Forbes]

Retail store traffic has fallen & may just stay that way [WSJ]

Old Warren Buffett article: the security I like best [Base Hit Investing]

The complete history of Warren Buffett [Dividend]

Report on food and beverage industry in Latin America [ECLAC]

Why Bitcoin matters [Marc Andreessen]

Warren Buffett will give you $1 billion if you fill out a perfect March Madness Bracket [BI]

Greenlight Capital's Q4 Letter: New Positions in Micron, BP, & Anadarko Petroleum

David Einhorn's hedge fund Greenlight Capital returned 19.1% net in 2013.  Greenlight's fourth quarter letter to investors unveils their thesis on new positions in Micron Technology (MU), BP (BP), and Anadarko Petroleum (APC).

Greenlight likes Micron because the industry has started to act a bit more rationally and MU will buyback shares instead of building new factories.

Their BP stake is a play on increasingly shareholder friendly capital allocation policies as well and they think the company is worth $70 per share (it trades around $49 now).  

Additionally, their letter talks about some positions they've closed recently like Airbus Group (formerly EADS), and ThyssenKrupp.

At the end of 2013, Greenlight's largest positions in alphabetical order were: Apple (AAPL), General Motors (GM), Marvell Technology (MRVL), Micron (MU), and Vodafone (VOD).

Thanks to ValueWalk who posted up Greenlight's Q4 letter and you can view it below:




For more on Einhorn, we just yesterday revealed some more of Greenlight's recent portfolio activity.

And for more year-end hedge fund letters, head to Third Point's Q4 letter here.

Lone Pine Capital Starts SBA Communications Position

Steve Mandel's hedge fund firm Lone Pine Capital has disclosed a brand new position in SBA Communications (SBAC).  They filed a 13G with the SEC indicating they own 6.4% of the company with almost 8.2 million shares. The filing was required due to portfolio activity on January 8th.

While this is a new stake, they've had exposure to the wireless tower stock play via their position in Crown Castle International (CCI). 

Their new SBAC position, however, is much larger and it's a bit curious that they would all of a sudden initiate their position now.  The thesis and valuation has largely been unchanged.  

It's also worth highlighting though that SBAC has been a longstanding top position for hedge fund White Elm Capital.  White Elm was founded by Matthew Iorio and before launching his own fund, he worked at Lone Pine.

While the bull case on tower stocks has been a play on the proliferation of wireless data usage, the bear case seemingly hinges on a potential rising interest rate environment and potential consolidation in the wireless carriers.

Per Google Finance, SBA Communications is "an independent owner and operator of wireless communications towers. The Company’s principal operations are in the United States and its territories."

We recently detailed some of Lone Pine's other portfolio activity here.

Third Point Q4 Letter: New Positions in Dow Chemical & T-Mobile

Dan Loeb's Third Point Offshore Fund is out with its fourth quarter 2013 letter.  In it, they reveal performance of 25.2% for the year.

Third Point's Q4 letter outlines their thesis on Dow Chemical (DOW), now their largest position.  They want the company to look into potentially spinning off its petrochemical business and to return capital to shareholders via buyback.

They also detail their thoughts on Ally Financial, a position they've been involved with since 2011 via various plays in the capital structure.  They look for the company to complete an IPO after undergoing a massive restructuring.

Lastly, the hedge fund highlights their thesis on Softbank, Sony (SNE) and T-Mobile (TMUS).  The latter is a brand new position they established during the company's secondary offering at $25 in November.

Embedded below is Third Point's year-end investor letter:




For more on this hedgie, we've also highlighted Third Point's other activity here.

Greenlight Capital Adds to Cairn Energy Stake

David Einhorn's hedge fund Greenlight Capital has added to its stake in London-listed oil and gas exploration company Cairn Energy (LON:CNE). 

Due to trading on January 16th, Greenlight increased their stake from 3% to 4.22% of Cairn's voting rights.  Approximately 20% is held via a total return swap, while the rest is held via common stock.

This stock has largely traded sideways since Greenlight first disclosed a holding in Cairn back in March of 2012.

Per Google Finance, Cairn Energy PLC (Cairn) is "an independent oil and gas exploration and production company. It is organized into two business units: Capricorn Group, being Capricorn Oil Limited and its subsidiary undertakings, and the Cairn India Group. There are two operating segments. Cairn India Limited Group’s operations are primarily within India."

For more on this hedge fund, you can view our previous updates on Greenlight Capital here.

Children's Investment Fund Trims Royal Mail Stake

Christopher Hohn's Children's Investment Fund has recently sized down its holdings of Royal Mail.  Previously, they owned 5.8% and now they own just under 4.6%.  They've sold around 12 million shares.

Royal Mail went public late last year and soared higher.  Children's Investment Fund was a big beneficiary as they were the largest shareholder. 

As such, it looks like Hohn's fund has locked in some profits.  According to fund documents, the firm returned well over 40% in 2013, with Royal Mail obviously contributing to those gains.

Howard Marks on the Role of Luck in Investing: Latest Letter

Oaktree Capital's chairman Howard Marks is out with his latest memo entitled, "Getting Lucky."  It's an interesting missive in which he delves into the role of luck in investing.

Marks writes, "Investment success isn't just a question of whether the investor put together the 'right' portfolio, but also whether it encountered a beneficial environment.  Thus being successful requires a significant degree of luck.  No one gets it right every time.  (That's why even the best investors diversify, hedge and/or limit their use of leverage.)  But the skillful investor is right more often, over a long period of time, than an assumption of randomness would permit.  We say about such investors, 'it can't be luck.'"

Remember, this is a letter that even Warren Buffett regularly reads so you're in good company.

Embedded below is Howard Marks' "Getting Lucky" memo:




You can download a .pdf copy here.

If you missed it, be sure to check out Marks' memo from last month: The Race Is On.

Greenood Investors' Thesis on Fiat (FIATY): Video Presentation

Steven Wood and Greenwood Investors have put together a video detailing their thesis on Fiat (FIATY).  Entitled "The Two Year Honeymoon," they outline why they think Fiat is still one of the best investments they've found.

Four reasons for their bullishness include: a bearish consensus (so they have a variant perception), the product cycle, exceptional management, and valuation at the cycle low.

Rather than type out all the details of their work, we'll let them walk you through their thoughts.  Embedded below is the video of GreenWood's Fiat thesis:



If you missed it, we previously posted Greenwood's thesis on Exor SpA & Fiat as well.

What We're Reading ~ Hedge Fund Links 1/17/14

2014 investor outlook from some top capital allocators [HF Intelligence]

Why invest in hedge funds anymore? [FINalternatives]

Some Tiger Cub performance numbers [II Alpha]

Hedge funds gain over $225 billion in 2013 [ValueWalk]

The extraordinary progress of the hedge fund industry [WorldFinance]

Crispin Odey: this is year for hedge funds not long only [Citywire]

Women hedge fund managers made more money than men in 2013 [IBTimes]

BlueCrest builds a hedge fund empire [BusinessWeek]

A few brave investors scored huge, market-beating wins in 2013 [WSJ]

The most successful strategy for hedgies in 2013: picking right stocks [WSJ]

Former LTCM exec to launch hedge fund industry tracker [FT]

What We're Reading ~ Analytical Links 1/15/14

Investment checklists catch fire [Abnormal Returns]

99% of long-term investing is doing nothing, the other 1% changes your life [Fool]

Research report on LKQ Corp [Prescience Point]

Lessons from short selling [Bronte Capital]

10 predictions for 2014 [FirstAdopter]

5 common investing mistakes you should avoid [Old School Value]

How to become a better investor [Oddball Stocks]

When does a bubble spell trouble? [WSJ]

Fiat's lone poker player needs to find another deal [FT]

After Beam deal, few big liquor mergers left [Dealbook]

Is Google about to make a push into online travel? [Marketwatch]

Time to admit Apple knows exactly what it's doing with its iPhone business [BusinessInsider]

RIA top industry blogs [RIAbiz]

An old profile: the best investor you've never heard of [CNN Money]

Profile of Uber's Travis Kalanick [BusinessInsider]

Farallon Capital Discloses Sycamore Networks Stake

Andrew Spokes' hedge fund Farallon Capital has disclosed a new stake in Sycamore Networks (SCMR). 

Per a 13G filed with the SEC, the hedge fund now owns 9.5% of SCMR with 2.745 million shares.  The filing was made due to portfolio activity on December 31st.

Per Google Finance, Sycamore Networks is "develops and markets intelligent bandwidth management solutions for fixed line and mobile network operators worldwide and provides services associated with such products. The Company’s customers include domestic and international wireline and wireless network service providers, utility companies, enterprises, and government entities. Sycamore’s bandwidth management portfolio of optical switches, multiservice cross-connects and multiservice access platforms serve applications across the network infrastructure, from multiservice access and regional backhaul to the optical core. It also develops and markets a mobile broadband optimization solution for mobile operators to reduce congestion in mobile access networks. The Company’s products serve two market areas within the networking industry, bandwidth management and mobile broadband optimization."

Corvex & Soroban Add To Williams Companies Position

Keith Meister's activist hedge fund Corvex Management and Eric Mandelblatt's Soroban Capital have filed an amended 13D with the SEC regarding their position in Williams Companies (WMB).  Per the filing, the hedge funds have disclosed they now own 6.74% of WMB with over 46 million shares.

The filing indicates their latest activity was on January 9th, 2014 and this stake is up from the previous 5% of the company they owned.  We initially highlighted when these hedge funds went activist on Williams last month.

Keep in mind, however, that their position disclosure is not inclusive of cash-settled swaps and options which reference an additional 21.3 million shares.  If you add in this exposure, they would own 9.86% of the company.

Per Google Finance, Williams Companies is "an energy infrastructure company focused on connecting North America’s hydrocarbon resource plays to markets for natural gas, natural gas liquids (NGLs), and olefins. Its operations span from the deepwater Gulf of Mexico to the Canadian oil sands. It operates in three segments: Williams Partners, Midstream Canada & Olefins and Other. Its interstate gas pipeline and domestic midstream interests are held through its investment in Williams Partners L.P. (WPZ). It owns the general-partner interest and a 70% limited-partner interest in WPZ. Williams also owns a Canadian midstream and domestic olefins production business, which processes oil sands off-gas and produces olefins for petrochemical feedstocks."

Avenue Capital Discloses Punch Taverns Position

Marc Lasry's Avenue European Management hedge fund has been building a stake in London listed pub company Punch Taverns (LON:PUB). 

Due to trading on the 6th and 10th of January, Avenue now own the equivalent of 8.29% of Punch Taverns' voting rights, all via contracts for difference/derivatives.

Avenue know the company well as Lasry mentioned in an NYT interview in 2012 that they held a position in Punch's debt.

Larry Robbins' Glenview Capital Management are Punch Taverns' largest shareholder with an 18.77% stake which they have held for over five years.

Per Google Finance – “Punch Taverns plc is a United Kingdom-based pub company. The Company is  engaged in the operation of public houses under either the leased model or as directly managed by   the Company. The Company operates in two business segments: punch partnerships, a leased estate   and punch pub company, a managed estate. Punch Partnerships is the Company’s leased division,   comprising 5,967 pubs nationwide. Punch Pub Company is its managed division, comprising 803   pubs nationwide. The leased model involves the granting of leases to tenants who operate the pub   as their own business, paying rent to the Company, purchasing beer and other drinks from it and   entering into profit sharing arrangements for income from leisure machines. Pubs that are directly   managed involve the employment of a manager to operate each managed pub.

Lone Pine Capital Adds to Wyndham Stake

Steve Mandel's hedge fund firm Lone Pine Capital has filed a 13G with the SEC regarding their position in Wyndham Worldwide (WYN).  Per the filing, Lone Pine now owns 5.2% of WYN with over 6.77 million shares.

The filing indicates they've purchased over 1.06 million shares since the end of the third quarter and the 13G was filed due to portfolio activity on January 2nd, 2014.

Per Google Finance, Wyndham Worldwide is "a hospitality company. The Company offers individual consumers and business customers an array of hospitality services and products across various accommodation alternatives and price ranges through its portfolio of brands. It operates in three segments of the hospitality industry: lodging, vacation exchange and rentals and vacation ownership. Its brands include Wyndham Hotels and Resorts, Tryp by Wyndham, Ramada, Days Inn, Super 8, Landal GreenParks, Novasol, Hoseasons, cottages4you, James Villa Holidays, ResortQuest by Wyndham Vacation Rentals, The Resort Company by Wyndham Vacation Rentals, Wyndham Vacation Resorts and WorldMark by Wyndham."

For more portfolio activity from Lone Pine, click here.

NYU Stern Evaluation Investment Newsletter: Roderick Wong, Aswath Damodaran, James Rosenwald & More

Today we wanted to share the inaugural issue of NYU Stern's student-run investment newsletter: Evaluation.  It features interviews with Professor Aswath Damodaran (whose work we've linked to many times), James Rosenwald of Dalton Investments, as well as Roderick Wong of RTW Investments, among others.

This newsletter differs from others in that it is geared toward those early on in their careers or those looking to get into investing/research.

The interviews in this first issue take you inside the lives of established portfolio managers, young buyside alumnus, young sell-side alumnus, and academics. 

Lastly, it also features two investment pitches from students: long Charter Communcations (CHTR) and short Peugeot (ENXTPA:UG).

Embedded below is NYU Stern's inaugural student newsletter:


 

Baupost Group Starts Kindred Biosciences Stake, Trims Enzon Pharmaceuticals Position

Seth Klarman's investment firm Baupost Group has filed 2 separate 13G's with the SEC.

Discloses New Position in Kindred Biosciences (KIN)

Baupost has disclosed a brand new stake in Kindred Biosciences (KIN).  Per the SEC filing, the firm now owns 17.93% of the company with 2.9 million shares.  The filing was required due to portfolio activity on December 31st.  Shares of KIN just started trading in December.

Per Google Finance, Kindred Biosciences is "a development-stage biopharmaceutical company. The Company focused on pets. In addition, it has seven other product candidates, including several biologics, in various stages of development. The Company’s product candidates are CereKin for the treatment of osteoarthritis pain and inflammation in dogs, AtoKin for the treatment of atopic dermatitis in dogs, and SentiKin for the treatment of post-operative pain in dogs. All of these product candidates, if approved, would be first-in-class drugs in the pet therapeutic market. The Company’s product pipeline consists of small molecules and biologics in various stages of development for a range of indications in dogs, cats and horses. Small molecules are generally chemical compounds administered orally and biologics are generally proteins and vaccines administered by injection."


Trims Enzon Pharmaceuticals (ENZN) Stake

The hedge fund also filed an amended 13G on Enzon Pharmaceuticals (ENZN) and disclosed they've sold over 3.35 million shares recently.  The filing was required due to activity on December 31st.  After these sales, Baupost still owns 9.84% of ENZN with over 4.33 million shares.

Per Google Finance, Enzon Pharmaceuticals is "a biotechnology company. The Company’s drug development programs utilize two platforms: Customized PEGylation Linker Technology (Customized Linker Technology) and third-generation messenger ribonucleic acid (mRNA) antagonists utilizing the Locked Nucleic Acid (LNA) technology. The Company has four compounds in human clinical development, a PEGylated version of the active metabolite of the cancer drug, irinotecan, PEG-SN38, and mRNA antagonists Survivin and the Androgen Receptor (AR). In addition, it has mRNA antagonist targets in various stages of preclinical research. The Company receives royalty revenues from licensing arrangements with other companies related to sales of products developed using its Customized Linker Technology-PEGINTRON. It is also using LNA technology to develop mRNA antagonists against oncology targets."


While it's always interesting to monitor Baupost's equity activities, keep in mind that their long equity book is only a small portion of their large overall assets under management (AUM).  For more on this hedge fund, we've posted up some of Baupost's other portfolio activity here.

What We're Reading ~ Hedge Fund Links 1/10/14

It's always relative.. that is, in performance [All About Alpha]

The obsession of John Paulson [AI-CIO]

Hedge funds cut 2 & 20 pricing [Fool]

Ackman issues status update on Herbalife [ZeroHedge]

Loeb takes position in Hertz, sources say [CNBC]

Jeff Ubben warns on let-down of activist investment boom [FT]

Update on Julian Robertson's new seeding platform [Dealbook]

On hedge fund proteges [Research Puzzle]

Third Point alum Bow Street bullish on media & telecom [ValueWalk]

Rare videos of Steve Cohen asked about securities laws [PBS]

Agecroft Partners' top 10 hedge fund industry predictions [FINalternatives]

Abenomics drives Japan hedge funds to world's top performers [Bloomberg]

China proves better bet than Japan for Asia hedge fund investors [HedgeWorld]

After scandal, SAC alums raising piles of cash [CNBC]

Harbinger knocks Dish's bid for Lightsquared's spectrum [HedgeWorld]

What We're Reading ~ Analytical Links 1/8/14

Investors/entrepreneurs predict trends, stocks & private companies to watch in 2014 [Forbes]

Compilation of what a lot of people learned in 2013 [Reformed Broker]

Individual investor stock allocation hits post-crisis high [Pragmatic Capitalism]

The world economy's shifting challenges [George Soros]

The best financial advice I ever got (or gave) [WSJ]

The 2014 buy list from [Crossing Wall Street]

Winners of 2013: boring investors [WSJ]

Why the P/E ratio doesn't always matter but cash flow is crucial [ValueWalk]

More 2014 predictions from market watchers [Yahoo Finance]

Liberty Media seeks full ownership of Sirius XM [Dealbook]

Billionaire Malone returns to empire building amid cord cutting [Bloomberg]

Hertz eyes sale of equipment rental unit [FT]

Venture Capitalists predict where they'll invest in 2014 [Forbes]

The art of misdirection [TED]

The 'internet of things' could be the next industrial revolution [DenverPost]

Ruffer Q4 Letter: Bulls Vs. Bears

Jonathan Ruffer is out with his Ruffer Investment Company fourth quarter letter.  In it, he highlights how there are currently two schools of thoughts when it comes to approaching the current markets:

"Those who are bearish, looking only at the fundamentals are forced to wait it out in the rising water, and it will be a matter of whether they can hold their nose and/or their nerve for long enough while the indices grind higher. Those who are bullish, whether through sunny optimism or a canny judgement of the situation, watch the Federal Reserve for some indication as to when they plan to pull away the punchbowl."

So, who flinches first?

Embedded below is Ruffer's Q4 letter:




For more from Ruffer, head to his Q3 letter on how he still anticipates eventual inflation.

Pershing Square Files 13D on Howard Hughes (HHC)

Bill Ackman's hedge fund Pershing Square Capital Management has filed an amended 13D with the SEC regarding their position in Howard Hughes (HHC).  Per the filing, Pershing has disclosed a 26.2% ownership stake in HHC via aggregate economic exposure of 10.88 million shares.

The main takeaway here is their swaps exposure to the name. They own 3.56 million common shares, Series A-2 warrants to purchase an additional 1.9 million shares, as well as 5.39 million shares of notional exposure via cash-settled total return swaps.  All of this exposure adds up to their 26.2% stake.

Per Google Finance, Howard Hughes is "a developer and operator of master planned communities and mixed use properties. The Company operates three segments: master planned communities, operating assets and strategic developments. The Company specializes in the development of master planned communities and ownership, management and the redevelopment or repositioning of real estate assets generating revenues, also called operating assets, as well as other strategic real estate opportunities in the form of entitled and unentitled land and other development rights, also called strategic developments."

For more on this hedge fund manager, head to Bill Ackman's latest presentation on Herbalife.

Starboard Value Goes Activist on Darden Restaurants (DRI) Too

Another activist has joined the Darden Restaurants (DRI) fight.  Jeffrey Smith's Starboard Value LP has disclosed a 5.55% stake in DRI with 7,250,000 shares via an activist 13D filing.

Last week, we highlighted Barington Capital's presentation on Darden Restaurants (DRI) where they called for the company to split up.  The company responded by announcing plans to spin off its Red Lobster chain. Now another activist is on the scene.

This is a brand new investment for Starboard.  They've engaged management in discussions and feel the announced plan doesn't maximize shareholder value.  Smith's 13D says,

"Specifically, Starboard believes there is a significant opportunity to dramatically improve the operating performance at the Issuer, as well as opportunities to realize substantial value from the Issuer’s real estate holdings and to explore other strategic options available to the Issuer to maximize shareholder value, including alternative business sale or separation transactions."

The company operates restaurants such as Olive Garden, Red Lobster, LongHorn Steakhouse, The Capital Grille, Yard House, Bahama Breeze, Seasons 52, and Eddie V's Prime Seafood.

For more on Starboard, see Jeff Smith's presentation on Wausau Paper.

Blue Ridge Capital Starts PBF Energy Stake

John Griffin's hedge fund firm Blue Ridge Capital filed a 13G with the SEC on shares of PBF Energy (PBF).  Per the filing, the hedge fund now shows a 7.82% ownership stake in the company with 3,095,000 shares.

This is a brand new position for Blue Ridge as they did not own a stake as of the end of the third quarter.  The filing was required due to portfolio activity on December 10th.

Per Google Finance, PBF Energy is "an independent petroleum refiners and suppliers of unbranded transportation fuels, heating oils, petrochemical feedstocks, lubricants and other petroleum products in the United States. The Company produces a range of products at each of its refineries, including gasoline, ultra-low-sulfur diesel (ULSD), heating oil, jet fuel, lubricants, petrochemicals and asphalt. The Company sells its products throughout the Northeast and Midwest of the United States, as well as in other regions of the United States and Canada, and are able to ship products to other international destinations."

You can view additional recent portfolio activity from Blue Ridge here.

Perry Capital Trims North American Energy Partners Position Again

Richard Perry's hedge fund firm Perry Capital has filed an amended 13D with the SEC regarding its position in North American Energy Partners (NOA).  Per the filing, Perry has disclosed a 4.75% ownership stake in NOA with 1,726,968 shares.

This marks around a 62% reduction in their position size as they've sold over 2.8 million shares since the end of the third quarter.  The filing indicates they sold shares at a price of $6 per share on December 19th.

This is also the second time they've trimmed their stake, as we highlighted Perry's NOA sales back in late October.

Per Google Finance, North American Energy Partners "provides a range of heavy construction and mining and pipeline installation services to customers in the Canadian oil sands, industrial construction, commercial and public construction and pipeline construction markets. The Company’s primary market is the Canadian oil sands, where it supports the customers’ mining operations and capital projects. NAEPI provides services through all stages of an oil sands project’s lifecycle, its core focus is on providing recurring services, such as contract mining, during the operational phase."

What We're Reading ~ Hedge Fund Links 12/20/13

Are commercial mortgages the next big thing for hedge funds? [CNBC]

Hedge funds cut fees to win big investors [FT]

Jim Chanos, bad news bear, urges market prudence [Reuters]

Many hedge funds launching traditional long-only strategies [TheAsset]

Managed accounts take the hassle out of hedge funds [Financial Standard]

Bill Miller to start fund with son under family name [Bloomberg]

Glenview Capital Adds to EVERTEC & Tenet Healthcare Stakes

Larry Robbins' hedge fund Glenview Capital filed a 13G and a Form 4 with the SEC disclosing some of their latest portfolio activity.


Glenview Adds to EVERTEC

Their 13G reveals activity in shares of EVERTEC (EVTC).  Per the filing, Glenview now owns 5.64% of the company with over 4.4 million shares.

This means they've doubled their stake since the end of the third quarter, when they initially built their position.  EVTC IPO'd in Q2 of this year.

Glenview's filing was required due to portfolio activity on December 9th.

Apollo has been the largest institutional shareholder, but one of its affiliates recently announced it would be selling 15.2 million shares in a secondary.  Other hedge funds are involved such as Corvex Management, Marble Arch Investments, and Pine River Capital.

Per Google Finance, EVERTEC is "formerly Carib Latam Holdings, Inc., is a full service transaction processing business in Latin America and the Caribbean. The Company provides a range of merchant acquiring, payment processing and business process management services across 19 countries in the region. It processes over 1.8 billion transactions annually, and manages the electronic payment network for over 4,100 automated teller machines (ATM) and over 104,000 point-of-sale payment terminals. It is the merchant acquirer in the Caribbean and Central America and in Latin America. The Company owns and operates the ATH network, one of ATM and personal identification number debit networks in Latin America. In addition, it provides a suite of services for core bank processing, cash processing and technology outsourcing. It serves a diversified customer base of financial institutions, merchants, corporations and government agencies with technology solutions."


Glenview Buys More Tenet Healthcare

Robbins' fund also filed a Form 4 with the SEC and disclosed purchases in shares of Tenet Healthcare (THC) on December 17th & 18th.  In total, they bought 1 million shares at weighted average prices between $39.30 and $41.20.

After this purchase, they now own 12.9 million shares of THC.  This has been a longstanding (and highly profitable) investment for the hedge fund.

Robbins also recently made a rare media appearance to talk about healthcare and for-profit hospitals.