Starboard Value's Presentation on Advance Auto Parts

Jeff Smith's activist investment firm Starboard Value today released a presentation on their newest holding, Advance Auto Parts (AAP).  They now own 3.7% of the company.

AAP currently trades around $190 and Starboard thinks shares could be worth over $350 with some of their changes implemented.  They like the favorable industry dynamics and think that AAP has underperformed peers long-term. 

Starboard seeks to increase shareholder value via four ways:

- Improve margins through operational efficencies
- Unlock value for Worldpac (underappreciated asset)
- Return capital to shareholders (dividend and/or buyback)
- Pursue industry consolidation

Embedded below is Starboard's presentation on AAP:



You can download a .pdf copy here.

For more from this investor, head to Jeff Smith's recent interview on activist investing.

ValueAct Capital Gets Board Nomination at 21st Century Fox, Increases Stake

Jeff Ubben's ValueAct Capital has filed an amended 13D regarding their stake in 21st Century Fox (FOX / FOXA).  Per the filing, ValueAct now owns 5.9% of the company with over 47.3 million FOX shares.

Increases FOX Stake

This is up from the 44.5 million shares they owned at the end of the second quarter.  ValueAct owns voting shares (FOX) and has utilized this to help earn themselves a seat at the table.  Their shares are held in a vehicle called Volpe Velox, which is Latin for swift fox.

Ubben Gets Board Nomination

The filing notes that Jeff Ubben has been nominated to Fox's board.  In exchange for the nomination, Ubben has agreed with the company to enter a standstill agreement.  His firm has agreed to not solicit any proxies and won't acquire 7% or more of the company's stock.

ValueAct seemingly acquired the majority of their position around $32 per share and FOX currently trades under $27.

For more on ValueAct, we also highlighted their recent investment in Rolls Royce.

Per Google Finance, 21st Century Fox is "a global media and entertainment company. The Company’s Cable Network Programming segment consists of the production and licensing of programming distributed primarily through cable television systems, direct broadcast satellite operators, telecommunication companies and online video distributors. The Television segment consists of the broadcasting of network programming in the United States and the operation of 28 full power broadcast television stations, including 10 duopolies, in the United States. The Filmed Entertainment segment consists of the production and acquisition of live-action and animated motion pictures for distribution and licensing in all formats in all entertainment media worldwide, and the production and licensing of television programming worldwide. The Direct Broadcast Satellite Television consists of the distribution of programming services via satellite, cable, and broadband directly to subscribers in Italy, Germany and Austria."

Be sure to also check out Mason Morfit on ValueAct's approach.

Lone Pine Capital Boosts Cheniere Energy Position

Steve Mandel's hedge fund firm Lone Pine Capital has filed a 13G with the SEC regarding its stake in Cheniere Energy (LNG). Per the filing, Lone Pine now owns 5.2% of the company with over 12.24 million shares.

This is up markedly from the 7.9 million shares they owned at the end of the second quarter.  The filing was made due to activity on September 18th.  LNG shares are down almost 30% since the end of Q2.

As we've highlighted recently, Cheniere Energy has attracted some big names on both the long and short sides.  Carl Icahn has been buying LNG shares recently and Seth Klarman's Baupost Group has also been an owner of shares for a bit.  On the other side of the trade, Jim Chanos is short LNG.

For more on Mandel's fund, we've detailed previous Lone Pine portfolio activity here.

Per Google Finance, Cheniere Energy is "an energy company engaged in Liquefied natural gas (LNG) businesses. The Company operates through two segments: LNG terminal business, and LNG and natural gas marketing business The Company owns and operates the Sabine Pass LNG terminal in Louisiana through its ownership interest in and management agreements with Cheniere Energy Partners, L.P. (Cheniere Partners), which is a publicly traded limited partnership. The Company owns 100% of the general partner interest in Cheniere Partners and 80.1% of Cheniere Energy Partners LP Holdings, LLC (Cheniere Holdings), which is a publicly traded limited liability company that owns a 55.9% limited partner interest in Cheniere Partners. The Company is engaged in the development of two LNG terminal projects: the Sabine Pass LNG terminal in western Cameron Parish, Louisiana, and the Corpus Christi LNG terminal near Corpus Christi, Texas." 

Carl Icahn Releases Video Warning: "Danger Ahead"

Activist investor Carl Icahn has released a video entitled "Danger Ahead" on his website.  In it, he warns of impending problems in high yield bonds, dysfunction in Washington and various board rooms of corporate America, among other things.

You can watch Icahn's video here.

Charlie Munger: The Complete Investor By Tren Griffin ~ Book Review

Tren Griffin recently released a new book entitled Charlie Munger: The Complete Investor.  In it, he outlines Munger's investing strategy and timeless lessons by extracting pearls of wisdom from speeches, interviews, writings, and shareholder letters.

If you're unfamiliar with Munger, he is the vice chairman of Berkshire Hathaway.  While Warren Buffett undoubtedly is the face of the organization, Munger has been an integral part of Berkshire's success.

After all, Buffett said that, "I have been shaped tremendously by Charlie" and Munger is largely credited with tweaking Buffett's value investing approach to focus more on quality by buying great businesses at a good price rather than merely good businesses at a great price.

While Munger is already studied and to an extent idolized by a fervent subsection of investors, the argument can be made that he actually is not as widely known or as reviewed as he should be, thanks in part to Buffett's blinding spotlight. Griffin helps to rectify that with a definitive book on Charlie Munger.

Griffin, who works for Microsoft, is the author of the blog 25iq (which we've linked to in our "What We're Reading" posts numerous times.)  There, he seeks to extract wisdom from top investors, business leaders, and entrepreneurs with his signature series of "A Dozen Things I've Learned From XYZ Investor."

Munger is well known for his 'mental models' and this book superbly focuses on this critical portion of Munger's approach.  By combining aspects of business with psychology, economics, ethics and more, Munger seeks to keep his emotions in check.  For Munger, being a successful investor is in part achieved simply by avoiding "the common pitfalls of bad judgment."


This book will undoubtedly and rightly be compared to Poor Charlie's Almanack, the compilation by Peter Kaufman as well as another book, Damn Right: Behind the Scenes with Berkshire Hathaway Billionaire Charlie Munger by Janet Lowe. 

All three books cover similar topics and content.  Each book is a reflection of its curator and this is where Griffin excels by focusing on the most important concepts related to Munger, with chapters on Munger's "Worldly Wisdom" as well as "The Psychology of Human Misjudgment."  The book also contains 23 pages on the important concept of 'moats' in investing.

Knowledge carnivores and avid readers will also find the bibliography at the end of the book a savory treat.  After all, the 17-page bibliography highlights sources Griffin used to amass this collection of wisdom. 

The main difference between the three major books on Munger is price.  Poor Charlie seems to retail for over $45 these days, and Damn Right typically goes for around $22.  True value investors might seek out Griffin's version, which seems to be the cheapest at $18 for hardcover and only $13.49 for the Kindle version.

Griffin's book will be most beneficial for investors who are always looking to improve their craft, especially in the realm of psychology, behavior, and other qualitative aspects of investing.  Investors new to Munger entirely will also find this book extremely useful, allowing them to play catch up on decades of wisdom in an easy 182-page read.  

Investors who have already scoured every word ever written or spoken by Munger will find this book to be redundant, as it doesn't contain much new information.  The book also isn't really a biography on Munger's life if that's what you're looking for.

However, one of the book's main advantages is the way the information is presented and organized.  Instead of having to scour hundreds of resources on Munger to find specific wisdom, this book concisely aggregates everything into distinct chapters to easily reference in the future.

Currently ranked as the #1 Best Seller in Amazon's "Stock Market Investing" category, be sure to check out Tren Griffin's new book, Charlie Munger: The Complete Investor.

Hedge Fund Links ~ 9/25/15

Hedge funds and tech stocks: the allure of private investments [Institutional Investor]

Dalio: risk parity strategies not to blame for the market volatility [Reuters]

Risk parity: the dog that did not bite [AQR]

Inside family offices for hedge fund bosses [Bloomberg]

Latest crop of hedge fund startups brings a difference [PIonline]

14 characteristics that make an outstanding hf manager [Business Insider]

Pension funds to shift hedge fund allocations to low volatility strategies [PIonline]

Harvard's fund is looking for short-sellers [CNBC]

Cliff Asness: paying a fair fee for the risk taken [ii alpha]

Former Baupost managing director plans hedge fund [Bloomberg]

Why some hedge funds can't wait for rates to rise [WSJ]

Getting my ass handed to me by the world's largest hedge fund [Medium]

Would Seth Klarman buy his own book? [ai-cio]

Asia Value Investor Conference 2015 - Discount For Our Readers

Asia Value Investor Conference - 8th December 2015

$300 discount code: MARKETFOLLY-AVIC

The organizers of the successful London Value Investor Conference will also now be holding the inaugural Asia Value Investor Conference on 8th December 2015 at the Four Seasons Hotel in Hong Kong. 

Speakers include Charles Brandes, Hassan Elmasry, Voon San Lai, Jie Gong, David Shapiro, Simon Denison-Smith and Mr. YEO Seng Cheong.  Tickets are now on sale and the remaining speaker slots will be filled in the next few weeks.

Market Folly readers will get a $300 discount to the conference by using the discount code MARKETVOLLY-AVIC when booking.

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.

There is an overview video of the upcoming conference, which also summarizes the recent London Value Investor Conference below:

Buy Tickets

$300 discount code: MARKETFOLLY-AVIC
Act fast, the discount expires 30th September! 

What We're Reading ~ 9/23/15

More Than You Know: Finding financial wisdom in unconventional places [Mauboussin]

Fundamentals are only half the story [Reformed Broker]

Masters in business interview with Jason Zweig [The Big Picture]

Full transcript: interview with Chinese President Xi Jinping [WSJ]

Ukraine & Europe: what should be done? [George Soros]

How cable can capture the mobile internet [WSJ]

Steve Wynn plays the China card [Barrons]

Highlighting large price increases on certain drugs [NYTimes]

Notes from Mohnish Pabrai's annual meeting [Frenzel Herzing]

The rent crisis is about to get a lot worse [Bloomberg]

The pace in Mexico's fight against corruption is slowing [FT]

A potential disruptor in the lab testing industry [Inc]

A look at how the Berkshire/Precision Castparts deal came together [Biz Journals]

Apple's iPhone upgrade plan is a gamechanger [Recode]

On the brink of a revolution in smart digital assistants [Wired]

The Big Short ~ Movie Trailer (Based on Michael Lewis' Book)

Michael Lewis' popular book, The Big Short, has now made it to the big screen.  The first trailer of the movie has been released that brings the story of the financial crisis and the US housing short to life.

Here's the cast:

- Christian Bale as Michael Burry
- Steve Carrell as Steve Eisman
- Ryan Gosling as Greg Lippmann
- Brad Pitt as Ben Hockett

The movie will be released around Christmas this year.  Embedded below is the video of the movie trailer:



While you wait for it to be released, definitely check out Michael Lewis' book The Big Short if you haven't already.  It's based on a true story and is a fantastic read.

Marcato Capital Starts LPL Financial Stake

Mick McGuire's activist hedge fund Marcato Capital has filed a 13D with the SEC regarding shares of LPL Financial (LPLA).  Per the filing, Marcato now owns 6.3% of the company with over 6 million shares.

This is a newly disclosed position for the firm as they did not own any shares at the end of the second quarter.  The filing was made due to activity on September 21st.

McGuire's firm was out buying shares in late August and throughout September at prices between $39.10 and $42.94.  Shares currently trade around $42.50.

The 13D contains the typical activist boilerplate that they may engage management, etc.

We've covered other previous portfolio activity from Marcato here.

Per Google Finance, LPL Financial is "an independent broker-dealer, a custodian for registered investment advisors (RIAs) and an independent consultant to retirement plans. The Company provides a platform of brokerage and investment advisory services to independent financial advisors, including financial advisors at around 700 financial institutions, enabling them to provide their retail investors with objective financial advice. It also supports approximately 4,400 financial advisors who are affiliated and licensed with insurance companies through customized clearing services, advisory platforms, and technology solutions. It provides its advisors with the front-office, middle-office, and back-office support. The Company provides its technology and service to advisors through a technology platform that is server-based and Web-accessible. Its subsidiaries include LPL Financial LLC, The Private Trust Company, N.A., Independent Advisers Group Corporation and LPL Insurance Associates, Inc."

Warren Buffett Increases Phillips 66 Position Again

Warren Buffett's Berkshire Hathaway has filed a Form 4 with the SEC regarding its position in Phillips 66 (PSX).  Per the filing, Berkshire has acquired over 3.5 million more shares.

After the purchases, Buffett now owns over 61.48 million shares of PSX.  Buffett was out buying at prices around $77-82 on September 4th, 8th, and 8th.

This is the second time Berkshire has added to its PSX position recently.

Per Google Finance, Phillips 66 is "an energy manufacturing and logistics company with midstream, chemicals, refining and marketing and specialties businesses. The Company operates its business through four segments: midstream, chemicals, refining and marketing and specialties. It gathers, processes, transports and markets natural gas, and transports, fractionates and markets natural gas liquids (NGL) in the United States. The Chemical segment manufactures and markets petrochemicals and plastics. The Chemicals segment consists of its 50% equity investment in Chevron Phillips Chemical Company LLC (CPChem). The refining segment buys, sells and refines crude oil and other feedstocks into petroleum products (such as gasolines, distillates and aviation fuels) at 14 refineries, mainly in the United States and Europe. The Marketing and Specialties segment purchases for resale and markets refined petroleum products (such as gasolines, distillates and aviation fuels), mainly in the United States and Europe."

For more from the Oracle of Omaha, we also posted a summary of Buffett's recent media appearances.

Goldentree's Steve Tananbaum on Wall Street Week

Anthony Scaramucci's rebooted version of Wall Street Week recently interviewed Steve Tananbaum of Goldentree Asset Management.

Goldentree manages $24 billion and has a bottom up value process focused on the credit markets.

Tananbaum commented on the recent market volatility, noting that investors all have differing views on what we should be concerned about: the Federal Reserve tightening, China issues, potential instability in Europe, etc.  He says that's what the market is struggling to prioritize.

He also notes that the bond market isn't as concerned with the direction of earnings.

As far as sectors go, Tananbaum said he thinks the media sell-off has been overdone, and singled out Time Warner (TWX) and Tribune Media (TRCO).

Embedded below is the video of Tananbaum's appearance on Wall Street Week:



If you missed it, be sure to also check out Eminence Capital's Ricky Sandler on Wall Street Week as well as Mario Gabelli's interview.

Carl Icahn Boosts Stakes in Cheniere Energy, Freeport McMoRan

Activist investor Carl Icahn has recently filed two amended 13D's with the SEC regarding his positions.


Boosts Cheniere Energy Stake

First, Icahn has disclosed a 9.59% stake in Cheniere Energy (LNG) with over 22.68 million shares.  This is an increase from the 19.35 million shares Icahn had exposure to when he first disclosed his position.

The new filing was made due to activity on September 14th, though he was also out buying on September 9th-11th at prices between $52.81 and $54.75.

Per Google Finance, Cheniere Energy is "an energy company engaged in Liquefied natural gas (LNG) businesses. The Company operates through two segments: LNG terminal business, and LNG and natural gas marketing business The Company owns and operates the Sabine Pass LNG terminal in Louisiana through its ownership interest in and management agreements with Cheniere Energy Partners, L.P. (Cheniere Partners), which is a publicly traded limited partnership. The Company owns 100% of the general partner interest in Cheniere Partners and 80.1% of Cheniere Energy Partners LP Holdings, LLC (Cheniere Holdings), which is a publicly traded limited liability company that owns a 55.9% limited partner interest in Cheniere Partners. The Company is engaged in the development of two LNG terminal projects: the Sabine Pass LNG terminal in western Cameron Parish, Louisiana, and the Corpus Christi LNG terminal near Corpus Christi, Texas."


Increases Freeport McMoRan Position

Second, Icahn has also just revealed an increased position in Freeport McMoRan (FCX).  Per the 13D, he now owns 8.8% of the company with 100 million shares (via exposure from forward contracts).  You can view all the fine print about his exposure here.

The filing was made due to activity on September 18th and is an increase from the 88 million shares he previously had exposure to.  Icahn initially revealed a new FCX stake in late August.

Per Google Finance, Freeport McMoRan is "a natural resource company with an industry portfolio of mineral assets, oil and natural gas resources, and a production profile. FCX has organized its operations into six primary divisions: North America copper mines, South America mining, Indonesia mining, Africa mining, Molybdenum mines, and United States oil and gas operations. The Company’s portfolio of assets includes the Grasberg minerals district in Indonesia, mining operations in North and South America, the Tenke Fungurume (Tenke) minerals district in the Democratic Republic of Congo (DRC) in Africa, and oil and natural gas assets in North America. The Company is also engaged in operating copper conversion facilities located in North America, and a refinery, three rod mills and a specialty copper products facility. The Company’s Atlantic Copper smelts and refines copper concentrates and markets refined copper and precious metals in slimes."

Market Strategist Jeff Saut: "We're Trying to Stay Constructive, But Negative Evidence Mounting"

It's been a while since we checked in with market strategist Jeff Saut.  This week, his commentary is called "Go Opposite to Hysteria" referencing a quote from Jim Rogers in the excellent Market Wizards book.

Saut takes a look at the technicals given all of the volatility as of late.  He concludes:

"If you want to put a positive spin on things, the six other times the stock market declined by 10% in four days, like it did in August, every time the market rose within a year.  If you want to put a negative spin on things, there was a Dow Theory 'sell signal' last month.  We are trying to stay constructive, but the negative evidence is mounting;"

Embedded below is Jeff Saut's latest investment strategy:



You can download a .pdf copy here.

Bridgewater's Ray Dalio Interview on Bloomberg

Bridgewater Associates founder Ray Dalio recently appeared on Bloomberg to share his thoughts.  He said he doesn't care whether the Federal Reserve raises by 25 basis points, but he doesn't see the reason for it.

Dalio notes that quantitative easing has a diminishing scale of returns as it will work less than it did last time.  He goes on to say, "We will have a downturn" and that it will be worrisome because the Fed won't really have the tools to fight it.

He says the environment we're in means that if you can't have interest rate moves, you'll have currency moves.

Dalio says that, "What worries me is what the next downturn looks like with asset prices where they are and the lesser ability of central banks to ease monetary policy."

He feels the Fed is too worried about the short-term debt cycle and not enough about the long-term debt cycle and he doesn't get it.  Dalio notes,

"The United States is in the midpoint of its short-term debt cycle.  Capacity utilization, GDP gap and, so as a result, we're talking about whether the Fed should tighten or not.  That's what central banks do in the middle of it.  And we're near the end of a long-term debt cycle.  Because that cycle of being able to raise -- you have interest rates going to zero.  You have spreads that are -- have come down.  So the spreads that have come down means that asset prices have gone up.  In other words, so now the expected return of asset classes is -- are all very low.  Cash, we know that bonds are going to two and a quarter percent.  You know that you're going to get for the next 10 years two and quarter percent on your bonds.  The equity price premiums look like three and a half or four percent on that.  So all of the asset classes now are aligned in normal risk premiums, that kind of thing.  That's why if interest rates rise faster than it's discounted in the markets, those markets are discountable."

On China, he says "they have to rebuild a new economy to replace the old economy."  He says China had the equity bubble as speculators rushed in, but he says this is normal for emerging economies.  He says China is going to be "just fine."

Over the next 10 years, Dalio says you're gonna have returns that are probably gonna average around 3-4% and it's a major pension fund problem.

Embedded below are videos of Dalio's interview on Bloomberg:

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For more from this manager, head to Ray Dalio on how the economic machine works.

What We're Reading ~ 9/16/15

The most dangerous trade: How short sellers uncover fraud [Richard Teitelbaum]

5 common mental errors that sway your decision making [James Clear]

Forecasting a global recession [Economist]

Avoiding the certainty trap [A Wealth of Common Sense]

What's not to like about wireless towers? [Morningstar]

Alibaba: Why it could fall 50% [Barrons]

Alibaba's response to that article [Alizila]

On the size and scope of Alibaba [Bronte Capital]

A look at fund manager current asset allocations [Fat Pitch]

Why the internet won't be the next TV for advertising [WSJ]

The US economy is just starting to tap into a big source of dry powder [Bloomberg]

Cheniere: America's most unlikely energy project [Bloomberg]

The Bloomberg Terminal faces upstarts [NYTimes]

Why Wall Street loves to hate Mylan's CEO [Fortune]

Nine of the world's biggest banks form blockchain partnership [Recode]

Howard Marks' Latest Memo: It's Not Easy (Oaktree Capital)

Oaktree Capital's chairman Howard Marks is out with his latest memo.  Entitled "It's Not Easy," Marks this time around focuses on lessons from Charlie Munger, the concept of second level thinking and how important it is.

Marks also addresses the recent market volatility and highlights some lessons learned.

Embedded below is Marks' latest memo, "It's Not Easy:"



You can download a .pdf copy here.

For more from this investor, be sure to check out Marks' book as well, The Most Important Thing.

And if you missed it, check out Marks' previous memo: Risk Revisited Again.

Eminence Capital Increases Men's Wearhouse Stake

Ricky Sandler's hedge fund firm Eminence Capital has filed an amended 13D regarding their position in Men's Wearhouse (MW).  Per the filing, Eminence now owns 8.3% of the company with over 4 million shares.

This is up from the 3.19 million shares they owned at the end of the second quarter.  The new filing was made due to activity on September 9th.  They purchased the bulk of their recent shares at $52.43 and $51.10.

If you missed it, Ricky Sandler also recently appeared on Wall Street Week and talked about many of their other positions.

Per Google Finance, Men's Wearhouse is "a specialty retailer of men's suits and a provider of tuxedo rental product in the United States and Canada. It operates in two segments: retail, which offers its products and services through its four retail merchandising brands and Internet Websites. The Company's corporate apparel segment provides corporate clothing uniforms and work wear to workforces."

Lee Cooperman Boosts PennyMac Mortgage Investment Trust Stake

Omega Advisors' founder Lee Cooperman has filed a 13G on shares of PennyMac Mortgage Investment Trust (PMT).  Per the filing, Cooperman now owns 5.17% of the company with over 3.86 million shares.

This is up from the 2.6 million shares Cooperman owned as of the end of the second quarter.  The new filing was made due to activity on September 4th.

For more from Omega, head to Steve Einhorn's interview on Wall Street Week.

Per Google Finance, Pennymac Mortgage is "a specialty finance company that invests primarily in residential mortgage loans and mortgage-related assets. The Company conducts all of its operations, and makes all of its investments, through PennyMac Operating Partnership, L.P. and its subsidiaries. The Company operates through two segments. The correspondent production segment represents the Company’s operations aimed at serving as an intermediary between mortgage lenders and the capital markets by purchasing, pooling and reselling newly originated prime credit quality mortgage loans either directly or in the form of mortgage-backed securities (MBS), using the services of PNMAC Capital Management and PennyMac Loan Services, LLC. The investment activities segment represents the Company’s investments in mortgage-related assets, which include distressed mortgage loans, real estate acquired in settlement of loans, MBS, mortgage servicing rights and excess servicing spread.."

Hedge Fund Links ~ 9/11/15

Some August hedge fund performance numbers [ZeroHedge]

Everyone's asking the wrong question about hedge fund performance [Business Insider]

Some hedge funds prosper in market tumult [NYTimes]

Pennant Capital shuttering Broadway Gate fund [FINalternatives]

Viking Global's CFO departs [Reuters]

Greenlight Capital down 14% for year [NYTimes]

Kyle Bass' post-crash returns small caliber [NYPost]

Bass loses challenge to pharma patents [Reuters]

How investors source and select hedge funds [Preqin]

In chaos, small hedge funds fare better [eFinancial News]

Hedge fund standards board to unveil cybersecurity memorandum [HedgeWeek]

KKR takes stake in Marshall Wace [NYTimes]

Obscure hedge fund buys billions of dollars worth of US Treasurys [WSJ]

Hedge funds' wobbles bolster argument against high fees [NYTimes]

Hf managers ditch Alibaba for rival JD [Bloomberg]

China hedge funds face worst month in 16 years after carnage [Bloomberg]

On hedge fund managers' tax rates [Fact Check]

Chieftain Capital Trims Tempur Sealy Stake

John Shapiro's investment firm Chieftain Capital recently filed an amended 13G with the SEC regarding its position in Tempur Sealy (TPX).  Per the filing, Chieftain now owns 5.21% of the company with over 3.22 million shares.

This is a decrease from the 3.55 million shares Chieftain owned at the end of the second quarter.  The latest filing was required due to portfolio activity on September 10th.

Chieftain has owned this stake since 2010 but has slowly been trimming the stake since the end of 2014.

Per Google Finance, Tempur Sealy is "a bedding provider. The Company develops, manufactures, markets, and distributes bedding products, which it sells globally. The Company operates in three segments: Tempur North America, Tempur International and Sealy. The Company’s brand portfolio includes TEMPUR, Tempur-Pedic, Sealy, Sealy Posturepedic, Optimum, and Stearns & Foster."

Howard Marks Lunch Auction ~ Capitalize For Kids

Oaktree Capital's Howard Marks has generously agreed to host a lunch for the benefit of the field of children's brain and mental health.  A high-end travel package to NYC will be provided for the auction winner alongside an opportunity to sit down with one of the greatest investors of our time.

Price is what you pay.  Value is what you get.  For additional information and to pre-register a bid, please contact: info@capitalizeforkids.com


About Howard Marks

Mr. Marks co-founded Oaktree Capital in 1995.  From 1985 until 1995, Mr. Marks led the groups at The TCW Group, Inc. that were responsible for investments in distressed debt, high yield bonds, and convertible securities.  He was also CIO for Domestic Fixed Income at TCW.  Previously, Mr. Marks was with Citicorp Investment Management, where from 1978 to 1985 he was VP and senior portfolio manager in charge of convertible and high yield securities.  Between 1969 and 1978, he was an equity research analyst and, subsequently, Citicorp's Director of Research.

David Tepper "Not as Bullish as I Could Be": Interview

David Tepper of hedge fund Appaloosa Management appeared on CNBC today to share his thoughts on markets.

In the interview, Tepper talked about the concept of flows and if all the money is flowing one way, then you have to buy the dips.  But if all the money starts flowing the other way, then you've got to sell the rips.

Tepper said, "I'm not probably as bullish as I could be because I have problems with earnings growth, I have problems with multiples... so I can't really call myself a bull.  However, I will say this, if you invest today in the stock market if earnings grow 5.5% per year you will make money at the end of five years."

He also noted that if you're fully invested now, it's not a bad time to take some money off the table.  Tepper also went on to say that if we had a 15-20% correction, "I would buy."

He says that valuations are adjusting to new realities and before "jumping back in the water" he wants to see big stocks with emerging markets components have their P/E's come down and mutual funds with higher cash levels.

Tepper notes that the US is fine with low unemployment and that it's an individual stockpicking moment.  But he also says that you "don't have that cushion of safety" in the stock market right now.

When you have lower global growth, you'll see lower P/E's, Tepper says.  The Appaloosa manager said that Apple (AAPL) has a low multiple and he owns it (though it's only around a 0.75% position for them now that they're just maintaining).  He says it will always have a low multiple because it's a device company with technological risk.  But it has China exposure, which the market dislikes these days. 

He mentioned he no longer owns Alibaba (BABA) as well.  He said he read the Chinese situation wrong and got out in early July.  "They just keep making policy mistake after policy mistake over there," Tepper notes.

Tepper also says that he thinks it's going to be hard to hit earnings estimates next year.  He argued that "flat is not a bad place to be" right now, referring to his exposure levels in equities.  He says he's not a great short seller and doesn't think levels are high enough right now.  But if the Federal Reserve doesn't tighten and the market gets excited about that, then he might bring himself to short.

He again reiterated that, "We don't have a huge equity book" right now.

Tepper then noted: "I have a saying in my office: 'There's a time to make money, and there's a time not to lose money.' What time is this? Not to lose money."


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Summary of Warren Buffett's Recent Media Appearances

Berkshire Hathaway's Warren Buffett recently made the media rounds so here's a quick summary.

In his interview with Fox Business, Buffett said that his brick business isn't doing as well as his carpet business.  He also noted that furniture retailing is doing well.  He also said, "The insurance business (GEICO) has been quite good to us over the years, and continues to be."

Regarding oil, Buffett points out a common misperception that his railroad (Burlington Northern Santa Fe) is not as affected as people might think.

When asked if he would raise rates in September if he was on the Federal Reserve, he said he probably wouldn't.

Embedded below is the video of Buffett's interview on Fox Business:





Buffett also talked with CNBC.  There, he said that he bought more IBM (IBM) thus far in the third quarter.

Interestingly, Buffett said that "I'll never go below $20 billion in cash."  This pertains to Berkshire's upcoming purchase of Precision Castparts (PCP) where he'll opt to finance part of the deal with debt in order to maintain that certain cash level.

Buffett also said that on big down days with higher volume in the stock market, Berkshire will be out buying more than usual of certain stocks if for instance they were buying 20% of the volume for that day.  He likes to stay around that level so that he doesn't affect the price too much.

He re-emphasized his focus on 5-10 years from now as he thinks markets will be higher then and that's all that really matters to him.  He isn't concerned with short-term gyrations and isn't about to predict what will happen in the near-term.

On why he bought a bunch of Phillips 66 (PSX), Buffett said, "I had always intended that we would come back in, assuming the price is right.  PSX has no upstream production.  PSX is not a pure refiner, they've got a big chemical division.  We're buying it because we like the company and we like the management very much."

Embedded below is the video of Buffett's interview with CNBC:




Lastly, Buffett also chatted with Bloomberg.  There, he revealed that he doesn't see local TV broadcasting as a growth business.

On the global economy, he noted that, "I think it's unlikely that the world has some great slowdown, but it always can."

He also noted he's bullish on China over its long-term potential.

Embedded below is the video of Buffett's talk with Bloomberg:

Jim Chanos Short Cheniere Energy, Caterpillar, Solar City & More: Interview

Noted short seller Jim Chanos, founder of Kynikos Associates recently appeared on CNBC to share his thoughts.

During the interview, he revealed a new short position: Cheniere Energy (LNG).  We've highlighted how Carl Icahn went long LNG recently.  There are also numerous other prominent hedge funds long.

Chanos, on the other hand, has been negative on the liquefied natural gas space over the past six months, thinking it's a "looming disaster" because it's tied into Asia and that LNG demand isn't growing anymore.

He went on to say, "LNG has been seen as a unique animal because it's going to be U.S. based, they're opening its Sabine Pass later this year.  With the stock at 30 times 2020 earnings, with the upside coming from a glutted market, we think the risk/reward in this, given where other LNG plays are in Australia and elsewhere, is just completely out of whack."

Chanos noted he's still short Caterpillar (CAT) but has covered his Joy Global (JOYG) short.  He argues CAT is trading at a rich multiple relative to its peers and that the company isn't letting on just how bad things are out there.

Chanos is also negative on pretty much everything in the PC chain.  He argues that "the value in the hardware chain gets competed away" as the products are commoditized.  He's short Hewlett Packard (HPQ) and some PC manufacturers in Asia.  He's hedged this by being long Apple (AAPL) with better growth and products.

He called Tesla (TSLA) "silly" as it trades on 2025 earnings that's become a momentum and concept stock. Regarding other Elon Musk companies, he thinks Solar City (SCTY) is the most problematic.

On China, Chanos continues to be concerned.  He says that "one of the worries we've always had was they were going to lose control of their currency ... that's why I think the markets took a real shudder in August."  That said, he argued that the US is the country "least affected by what's happening in China."

Lastly, Chanos also said cybersecurity is one of the few areas of growth.

Embedded below are videos from Chanos' interview:

Video 1:



Video 2:



Video 3:



Video 4:



Video 5:




For more from this short seller, be sure to also check out another recent Jim Chanos interview.

What We're Reading ~ 9/9/15

The long road of proving yourself as an investor [Morgan Housel]

On the importance of journaling your investment thoughts [Safal Niveshak]

Prices have changed, not much else has changed [Aleph Blog]

Charts summarizing recent economic activity [Calafia Beach Pundit]

China to face tough economic conditions for up to 10 years [Nikkei Asian Review]

The case for keeping US interest rates low [FT]

A play on the student loan bubble: short Navient [SumZero]

Charter: John Malone's return to the US cable industry [Punch Card Blog]

Patrick Drahi positions himself to be a player in US cable [NYTimes]

Cable box rentals: a needless $19 billion industry [The Atlantic]

Is the high cost of live sports a tipping point? [Bloomberg]

James Tisch lecture on value investing [ValueWalk]

How the average US consumer spends their paycheck [CreditLoan]

Coming soon: Millennials married with children [WSJ]

Senator Investment Group Increases Realogy Position

Alex Klabin and Doug Silverman's hedge fund Senator Investment Group has filed a 13G with the SEC regarding shares of Realogy (RLGY).  Senator now owns 5.12% of the company with 7.5 million shares.

This is a sizable increase from the 4 million shares they owned at the end of the second quarter.  The filing was made due to activity on August 27th.

As of the end of Q2, some of the largest holders of RLGY shares included other prominent hedge funds such as Lone Pine Capital, Paulson & Co, Glenview Capital, Pennant Capital, and Valinor Management, among others.

For more from this fund, be sure to check out Alex Klabin on the intangibles of building a great hedge fund.

Per Google Finance, Realogy is "a franchisor of residential real estate brokerages and a provider of outsourced employee relocation, and title and settlement services in the United States. The Company has four operating segments: Real Estate Franchise Services (RFG), Company Owned Real Estate Brokerage Services (NRT), Relocation Services (Cartus), and Title and Settlement Services (TRG). The RFG segment is a franchisor of residential real estate brokerage services. The NRT segment owns and operates a residential real estate brokerage business in the United States. The Cartus segment provides outsourced employee relocation services. The TRG segment provides full-service title and settlement services to its clients. The Company's portfolio of brokerage brands includes Century 21, Coldwell Banker, Coldwell Banker Commercial, ERA, Sotheby's International Realty, Better Homes and Gardens Real Estate, The Corcoran Group, ZipRealty and Citi Habitats."

Falcon Edge Capital Boosts Pandora Stake

Rick Gerson's hedge fund firm Falcon Edge Capital has filed a 13G with the SEC regarding shares of Pandora (P).  Per the filing, Falcon Edge now owns 5.5% of the company with 11.62 million shares (including 6.95 million shares issuable upon exercise of options).

This is an increase from the 4.67 million shares of exposure the firm had at the end of the second quarter.  The filing was made due to activity on August 27th.

You can view other portfolio activity from Falcon Edge here.  Prior to founding Falcon Edge, Gerson was at Blue Ridge Capital since its inception.

Per Google Finance, Pandora is "a provider of Internet radio services. The Company offers personalized experience for each of its listeners wherever and whenever they want to listen to radio on a range of smartphones, tablets, computers and car audio systems, as well as a range of other Internet-connected devices. In addition, Pandora offers local and national advertisers to provide targeted messages to its listeners using a combination of audio, display and video advertisements."

Jim Simons Rare Interview: TED Talk With the Mathematician Who Cracked Wall Street

Jim Simons, founder of quantitative investment firm Renaissance Technologies (commonly referred to as Rentec) this year made a rare appearance at one of the TED talks.  The conversation was entitled "A rare interview with the mathematician who cracked Wall Street."

As we've highlighted in the past, Rentec's internal Medallion Fund has generated outstanding performance numbers.  While many hedge funds charge 2% management and 20% performance fees, Medallion was said to charge 5% and 44% at one time.  While this fund is only available internally, Rentec also runs two other funds available to outside investors, known as RIFF and RIEF.

His talk touches on topics of mathematics, code breaking, and patterns in the world of finance.

He attributes his success to assembling a great team.  Rentec famously employs scientists, mathematicians, astronomers, and physicists.  Their approach focuses on assembling a lot of data and looking at patterns.

Simons said that, "We take in terabytes of data a day and store it away and massage it and get it ready for analysis and you're looking for anomalies."

He also noted that hedge funds as a whole have not fared that well over the last 3-4 years.

Embedded below is the video of Jim Simons' TED talk:



For more from this legend, we've also previously posted Jim Simons on mathematics, common sense, good luck & his career.

Miura Global Increases Zoe's Kitchen Position

Pasco Alfaro's hedge fund Miura Global has filed a 13G with the SEC regarding shares of Zoe's Kitchen (ZOES).  Per the filing, Miura now owns 5.51% of the company with 1,067,000 shares.

This is up from the 960,000 shares Miura owned at the end of the second quarter.  The new filing was made due to activity on August 31st.

Per Google Finance, Zoe's Kitchen "primarily develops and operates fast-casual restaurants serving a range of Mediterranean dishes."

Glenview Capital Raises Hertz Stake

Larry Robbins' hedge fund firm Glenview Capital has filed a 13G with the SEC regarding its position in Hertz (HTZ).  According to the filing, Glenview now owns 5.2% of the company with over 23.74 million shares.

This is up from the 17.6 million shares Glenview owned at the end of the second quarter.  The latest filing was made due to activity on August 25th.

We've highlighted other recent portfolio activity from Glenview here.

Hertz is also a position in activist Carl Icahn's portfolio as he has representation on the board as well.  The company's shares have been under pressure over the past year as they had to restate various financials in addition to worries about the ability to raise prices and potential competition from services like Uber.  HTZ also has a potential catalyst coming up with the spin-off of its equipment rental business.

Per Google Finance, Hertz "operates car rental business through its Hertz, Dollar, Thrifty and Firefly brands. The Company's operating segments are U.S. Car Rental, International Car Rental, Worldwide Equipment Rental and All Other Operations."

What We're Reading ~ 9/2/15

Valeant Pharmaceuticals (VRX): a detailed look inside a dangerous story [AZ Value]

Thoughts on shorting [Fritz Investments]

When to deploy capital [Aleph Blog]

A look at Ed Borgato's process [Richard Chignell]

Analysis of Liberty Global's Latin American assets (LILA) [Clark Street Value]

The China growth story is now broken [Salient Partners]

The Fed is set to make a dangerous mistake [FT]

A roadmap for a world without drivers [Alex Rubalcava]

How Tesla will change the world [Wait But Why]

The FCC imposes Netflix's broadband policy [WSJ]

An internet mortgage provider reaps the rewards [NYTimes]

Lurking problems with exchange traded funds [Zero Hedge]

Market plunge provides harsh lessons for ETF investors [Barrons]

Mexico's economy was supposed to soar; it's starting to flop [Washington Post]

Hotels fight back against sites like Expedia and Priceline [NYTimes]

Is Silicon Valley in another bubble and what could burst it? [Vanity Fair]

Pennant Capital Cuts Universal Alloy Stake Further

Alan Fournier's hedge fund firm Pennant Capital has been gradually selling down its Universal Stainless & Alloy Products (USAP) position.  Per a recently filed Form 4 with the SEC, this is now the second time in recent months that they've trimmed the stake.

Their latest filing shows activity on August 28th, 31st, and September 1st.  In total, they sold 200,534 shares at prices of $13.01 and $13.02.  After these sales, Pennant still owns 849,069 shares of USAP.

We've also highlighted a stock Pennant has been buying lately.

Per Google Finance, "Universal Stainless & Alloy Products "manufactures and markets semi-finished and finished specialty steel products, including stainless steel, nickel alloys, tool steel and certain other alloyed steels. The Company's manufacturing process involves melting, remelting, heat treating, hot and cold rolling, forging, machining and cold drawing of semi-finished and finished specialty steels. The Company's products are sold to service centers, forgers, rerollers, original equipment manufacturers (OEMs) and wire redrawers. The Company also performs conversion services on materials supplied by customers. The Company's products are manufactured in a range of grades and melt qualities, including argon oxygen decarburization (AOD), electro-slag remelted (ESR), vacuum induction melting (VIM) and vacuum-arc remelted (VAR)."

Pleasant Lake Partners Boosts Del Taco & Hemisphere Media Stakes, Sends Letter to Magnachip

Jonathan Lennon's hedge fund firm Pleasant Lake Partners has filed numerous documents with the SEC lately regarding its positions.


Adds to Del Taco Restaurants Stake

First, Lennon's firm has boosted its stake in Del Taco Restaurants (TACO).  Per a Form 4 filed with the SEC, Pleasant Lake was out buying shares of TACO on August 28th and 31st at prices of $13.2 and $12.99. In total, they bought 107,400 shares and now own over 4.98 million TACO shares.  Pleasant Lake initially started a Del Taco stake a few months ago.

Per Google Finance, Del Taco is "a food service company. The Company operates quick service restaurant (QSR) chain under Del Taco in the United States. The Company offers Mexican- cuisine and American classics menu. Its menu includes various categories, such as tacos, burritos, Fresca bowls, American grill, quesadillas and nachos, desserts and shakes, sides and salads, combos and fiesta pack, kid's meals, drinks, breakfast, and Buck & Under. In addition, its menu includes Double Beef Classic Taco, Del Combo Burrito, Del Beef Burrito, MACHO Combo Burrito, Double Del Cheeseburger, Bacon Double Del Cheeseburger, Deluxe Chili Cheddar Fries, MACHO Nachos, Caramel Cheesecake Bites, Chocolate Chip Cookies, CrunchTada Tostada and Turkey CrunchTada Tostada, among others. The Company and its franchisees operate approximately 550 restaurants in 16 states."


Increases Hemisphere Media Position

Second, Pleasant Lake Partners has also filed a Form 4 regarding its position in Hemisphere Media (HMTV).  We covered earlier how this hedge fund has been buying HMTV shares and they're at it again.

Their filing notes they were accumulating more shares on August 27th, 28th, and 31st at prices of $13.58, $13.63, and $13.59.  In total, they bought 28,556 shares and now own over 1.94 million HMTV shares.

Per Google Finance, Hemisphere Media is "the United States Spanish-language media company serving the United States Hispanic and Latin American markets with approximately five Spanish-language cable television networks distributed in the United States, over two Spanish-language cable television networks distributed in Latin America, and is a broadcast television network in Puerto Rico. The Company owns and operates the Spanish language networks and content production platform, including movie and telenovela channels, two Hispanic entertainment genres, and the cable television networks. The Company's the United States Hispanic groups include WAPA is an independent broadcast television network; WAPA America is a Spanish-language cable television network; Cinelatino is the Spanish-language cable movie network; Pasiones is the Hispanic genre telenovelas; Centroamerica TV features news and entertainment programming, and Television Dominicana features news and entertainment programming.."


Sends Letter to Magnachip Semiconductor

We've previously posted Pleasant Lake's presentation on Magnachip Semiconductor (MX).  They now own 9.9% of the company, up from the previous 9.5% stake they held.  Lennon recently filed an amended 13D with the SEC and included this letter to the board:

"Dear Doug and Randal, 

As you know, funds managed by Pleasant Lake Partners (“PLP”) are one of the largest shareholders of Magnachip Semiconductor Corporation (“Magnachip” or the “Company”) with a 9.9% stake in the Company.  We have stated to you our desire to increase the size of our investment and have requested that the Board consider removing the Company’s poison pill.  We have also requested to be included in any upcoming auction process for the Company.  However, we have yet to receive a formal response to either request.  Furthermore, while the Company has formed a Strategic Review Committee, shareholders have seen little tangible progress to date.  We believe the Company needs major and immediate strategic change and that the best course for value maximization for all shareholders is to sell Magnachip.  Accordingly, in order to effectuate this, we are writing to you today to formally submit an indication of interest to purchase all of the outstanding shares of Magnachip that PLP does not currently own at a price of $10.00 per share in cash (the “Proposal”).  The Proposal represents a premium of approximately 29% to Friday’s closing price and approximately 58% to PLP’s average cost and is subject to confirmatory due diligence and the negotiation of definitive transaction documents. 

Since filing our 13D on June 10, we have sought to work constructively with you to realize the full value of these assets for the benefit of all shareholders.  And while we appreciate the time you have spent discussing these issues with us, the accelerating pace of consolidation in the semiconductor industry, coupled with what believe are Magnachip’s strategically valuable assets and intellectual property, has led us to make this Proposal.  We have consistently heard from other shareholders that the status quo at Magnachip is not acceptable and that the Company, in whole or in part, would be worth significantly more to strategic acquirers than as a standalone entity.  While we are obviously not such a strategic acquirer, we think shareholders should have the ability to decide for themselves whether to accept our Proposal at $10.00 per share, or wait for other potentially better offers; were any such offers to emerge, we would be prepared to vote our shares in favor of an offer that we believe is materially superior to our Proposal. 

We respectfully ask that you and the Board immediately engage with us to discuss the Proposal and negotiate a transaction.  We are prepared to devote all necessary resources to evaluate and consummate a transaction, and believe we can obtain the necessary financing to do so. 

We look forward to hearing from you and are ready to speak at your convenience.  

Sincerely, 
/s/ Jonathan Lennon
Managing Member
Pleasant Lake Partners LLC"

Viking Global Boosts Mallinckrodt Position

Andreas Halvorsen's hedge fund firm Viking Global has filed a 13G with the SEC regarding its position in Mallinckrodt (MNK).  Per the filing, Viking now owns 4.9% of the company with over 5.72 million shares.

This is up slightly from the 5.41 million shares they owned at the end of the second quarter.  The filing was made due to activity on August 21st.

We've also highlighted some of Viking Global's short positions here.

Per Google Finance, Mallinckrodt is "a global specialty pharmaceuticals company. The Company develops, manufactures, markets and distributes both branded and generic specialty pharmaceuticals, active pharmaceutical ingredients (API) and diagnostic imaging agents. The Company uses its API products in the manufacture of its generic pharmaceuticals and also sells them to other pharmaceutical companies. The Company operates through two segments: Specialty Pharmaceuticals and Global Medical Imaging. The Company’s Specialty Pharmaceuticals segment develops, manufactures and sells, through its Brands business, drugs, including EXALGO (hydromorphone HCl) Extended-Release Tablets and GABLOFEN. The Company’s Global Medical Imaging segment develops, manufactures and markets contrast media and delivery systems (CMDS). The Company offers INOMAX Total Care (inhaled nitric oxide), a neonatal critical care product."

Warren Buffett's Berkshire Hathaway Boosts Phillips 66 Stake

Warren Buffett's conglomerate Berkshire Hathaway has filed a Form 3 and Form 4 with the SEC.  Per the filing, Berkshire now owns over 57.9 million shares of Phillips 66 (PSX).

Berkshire was out buying on August 26th - 28th at prices between $71.56 and $77.26.  In total, they bought over 3.17 million shares over those three days.  They now own over 10% of the company with a stake worth over $4.4 billion.

However, they had to have also acquired a ton of shares prior to that.  As the brand new issue of our Hedge Fund Wisdom newsletter flagged 10 days ago, Buffett requested confidential treatment with the SEC regarding one of his holdings for his Q2 13F filing.  PSX did not appear in his holdings list at that time so it looks like this could be the position he was requesting privacy on.

Back in the first quarter of this year, Buffett owned just 7.49 million PSX shares.  So basically between April 1st and August 28th, Berkshire ramped up its exposure to PSX in a big way.  Shares largely traded sideways over that timeframe, between $75 and $84.  During the recent market turmoil, however, they traded as low as $69.79.

Buffett has been busy lately, as he's also agreed to takeover Precision Castparts (PCP).

For more on Buffett's firm, be sure to also check out our analysis of Axalta Coating Systems (AXTA), another stock Berkshire bought in recent months.

Eminence Capital's Ricky Sandler on Wall Street Week: KORS, EBAY/PYPL, ZNGA, RGC & More

Ricky Sandler, founder of hedge fund Eminence Capital, was recently interviewed on Anthony Scaramucci's rebooted show Wall Street Week.

Eminence manages $6.5 billion now and has been running for 17 years.  Sandler focuses on "quality value," looking for quality businesses but trading at discount prices.  He likes the intersection of growth and value, focusing on a "growth at a reasonable price" approach.

He likes Michael Kors (KORS) and notes it was a momentum stock that experienced a deceleration and he thinks it's a terrific brand that has opportunity for international expansion, trading at under at 10x PE.

Sandler also touched on eBay (EBAY), which recently split off its payments arm PayPal (PYPL).  The standalone EBAY is now purely an online marketplace.  Sandler says PYPL trades about for 20x earnings when you back out the cash, and it has 20% growth "for as far as the eye can see."

The Eminence founder also talked about gaming plays Zynga (ZNGA), Activision (ATVI), Take Two Interactive (TTW), and Ubisoft (UBI.PA).

Eminence is also short Regal Cinemas (RGC).

We've highlighted some other portfolio activity from Eminence here.

Embedded below is the video of Ricky Sandler's Wall Street Week interview:



For more, be sure to check out Mario Gabelli's interview on Wall Street Week from last week too.

Stockbridge Partners Increases Advanced Drainage Systems Stake

Stockbridge Partners has filed a 13G with the SEC regarding shares of Advanced Drainage Systems (WMS).  Per the filing, Stockbridge now owns 6.9% of the company with over 3.66 million shares.

This is up from the 2.86 million shares they owned at the end of the second quarter.  The filing was made due to activity on August 18th.

Some of their other holdings include Transdigm (TDG), Markwest Energy (MWE), Charter Communications (CHTR), LPL Financial (LPLA), Wabco (WBC), among others.


About Stockbridge Partners

This is the first time we've featured Stockbridge.  It's part of the Berkshire Partners umbrella, a private equity firm.  Per their website, Stockbridge takes "positions in public securities with a bias toward being long-term investors, focusing on high quality companies that exhibit earnings sustainability and growth.  We accept short-term volatility - and in many cases, view price fluctuations more as opportunities than as risks."  It was launched in 2007 and manages over $2 billion with Robert Small directing the group.


About Advanced Drainage Systems

Per Google Finance, Advanced Drainage Systems is "a designer, manufacturer and marketer of high performance thermoplastic corrugated pipe and related water management products, primarily in North and South America and Europe. The Company is managed based primarily on the geographies in which it operates and reports results of operations in two reportable segments Domestic and International. The Company’s products are used across a range of end markets and applications, including non-residential, residential, agriculture and infrastructure applications. The Company’s product line includes corrugated high density polyethylene (HDPE) pipe, polypropylene (PP) pipe and related water management products."