Chase Coleman and Feroz Dewan's hedge fund Tiger Global has filed an amended 13G with the SEC regarding shares of Tuniu (TOUR). Per the filing, Tiger Global no longer owns an equity stake in the company.
The filing was made due to activity on July 15th. We previously disclosed Tiger Global's new Tuniu stake back in May as the company completed its IPO then. But now they've exited that position.
For more recent activity from this hedge fund, check out Tiger Global's moves here.
Per Google Finance, Tuniu is "an online leisure travel company. The Company offers a selection of packaged tours, including organized tours and self-guided tours, as well as travel-related services for leisure travelers. It offers packaged tours sourced from over 3,000 travel suppliers, covering over 70 countries, as well as all popular tourist attractions in China. The Company’s product portfolio consists of over 100,000 stock-keeping units (SKUs) of organized tours, over 100,000 SKUs of self-guided tours, and tickets for over 1,000 domestic and overseas tourist attractions. Its online platform, which consists of its tuniu.com Website and mobile platform, provides comprehensive product and travel information through user-friendly interfaces to enable leisure travelers to plan their travels and search for itineraries. Its online platform contains photos, information and recommendations for all destinations it covers."
Friday, July 18, 2014
Tiger Global Exits Tuniu (TOUR) Position
Thursday, July 17, 2014
What We're Reading ~ Analytical Links 7/17/14
Serengeti Asset Management's thesis on Energy XXI [Harvest]
Investing Psychology: The Effects of Behavioral Finance on Investment Choice [Tim Richards]
Analyzing the impact of Fed rate hikes on markets & economy [Advisor Perspectives]
More notes from the Delivering Alpha conference: Paulson, Peltz & Icahn [Reformed Broker]
HBO said valued at $20 billion by Fox seeking Netflix killer [Bloomberg]
Most important investing trait? Patience [Alpha Baskets]
US stands to lose billions from corporate tax inversions [WSJ]
Wednesday, July 16, 2014
Glenview Capital Boosts Carter's Position
Larry Robbins' hedge fund firm Glenview Capital has filed a 13G with the SEC regarding shares of Carter's (CRI). Per the filing, Glenview now owns 6.84% of the company with over 3.67 million shares.
This marks an increase of over 2.1 million shares in their position size since the end of the first quarter. The filing was made due to activity on July 10th.
Glenview isn't the only hedge fund that's been out buying CRI shares, either. We recently highlighted that Hound Partners added to their Carter's stake too.
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."
Stan Druckenmiller's Thoughts at Delivering Alpha Conference
At CNBC and Institutional Investor's Delivering Alpha conference today, legendary investor Stan Druckenmiller shared his latest thoughts.
At the event, Druckenmiller said he can't bet as big as he used to these days. He also noted that other investors like David Tepper and George Soros have the biggest (you know what) on Wall Street these days.
Also, he knocked IBM as a company that's spending all of its money on share buybacks instead of on innovating and this could come back to haunt them as they get passed by modern technology companies.
Regarding the latest slew of IPO's, Druckenmiller pointed out that 80% of those companies don't really have earnings.
Turning to the Fed, he also argued that the consequences of monetary policy will be a lot worse than they think and said their policy is baffling.
He thinks we have to keep dancing until the music stops, but the problem is most people won't be able to exit fast enough once it happens.
Lee Cooperman's Favorite Stock Picks at Delivering Alpha Conference
At CNBC and Institutional Investor's Delivering Alpha conference today, Omega Advisors' Lee Cooperman shared his favorite stock picks.
He likes Actavis (ACT), a tax inversion play, Citigroup (C), a good buy he says because the economy is healing with loan demand and one that could narrow the discount to book value over time, as well as Gaming and Leisure Properties (GLPI) and Nordic American Offshore (NAO).
Other plays he likes include: QEP Resources (QEP), Supervalu (SVU), Louis XIII (577 HK), and Monitise (MONI.LN), the mobile payments play he's pitched before.
Lastly, he also mentioned Thermo Fisher Scientific (TMO), KKR (KKR) and Sandridge Energy (SD).
Cooperman also noted that the last time the Fed raised rates was in 2006 and around 25% of fund managers weren't really around to experience that.
He also joked that the last time he was bearish was during his Bar Mitzvah.
One quote that stood out from him was that, "if you buy something that's out of favor, things seem to happen to make you right."
Lee Cooperman will be presenting new investment ideas at the upcoming Value Investing Congress in a few months and readers can receive a discount to the event by registering here and using discount code: MARKETFOLLY
Larry Robbins' 6 Best Ideas at Delivering Alpha Conference
At CNBC and Institutional Investor's Delivering Alpha conference today, Glenview Capital's Larry Robbins highlighted his six best ideas.
His stock picks were: Thermo Fisher Scientific (TMO) which has been his largest holding, Monsanto (MON) which he previously pitched here, as well as HCA (HCA), Hertz (HTZ), National Oilwell Varco (NOV) and Flextronics (FLEX), a position he added to in May.
He likes that all of these can raise money on the cheap and then buyback shares. So basically, his favorite investment idea is a theme of companies levering up.
Also, today we highlighted that Robbins has been buying Carter's (CRI) shares recently too.
Tuesday, July 15, 2014
Lone Pine Capital Starts Spirit Airlines Stake
Steve Mandel's hedge fund firm Lone Pine Capital has filed a 13G with the SEC on shares of Spirit Airlines (SAVE). Per the filing, Lone Pine now owns 6% of the company with over 4.3 million shares.
This is a brand new position for the hedge fund as they did not own any shares at the end of Q1. The filing was made due to activity on July 2nd.
You can view additional portfolio activity from Lone Pine here.
Citadel Ups Position in PHH Corp
Ken Griffin's Citadel has filed an amended 13G with the SEC regarding shares of PHH (PHH). Per the filing, Citadel now owns 9.6% of the company with over 5.5 million shares.
This marks an increase of over 3.9 million shares in their position size since the end of the first quarter. The filing was made due to activity on July 8th. PHH recently said they would repurchase around 35% of shares.
Per Google Finance, PHH is "an outsource provider of mortgage and fleet management services. PHH operates in three segments: Mortgage Production, Mortgage Servicing and Fleet Management Services. The Company provides mortgage banking services to a range of clients, including financial institutions and real estate brokers, throughout the United States. The Company’s mortgage banking activities include originating, purchasing, selling and servicing mortgage loans through its wholly owned subsidiary, PHH Mortgage Corporation and its subsidiaries (collectively PHH Mortgage). It provides commercial fleet management services to corporate clients and government agencies throughout the United States and Canada through its wholly owned subsidiary. In July 2014, PHH sold its Fleet Management Services business, doing business as PHH Arval, to Element Financial Corporation."
Paulson & Co Updates CNO Financial Group Position
John Paulson's hedge fund firm Paulson & Co has filed an amended 13D with the SEC regarding shares of CNO Financial Group (CNO). Per the filing, Paulson now owns 4.7% of the company with just over 10.55 million shares.
This marks a slight decrease of 1.9 million shares in their aggregate common stock exposure since the end of the first quarter. The filing was made due to activity on June 26th. Their position includes 5 million shares issuable upon exercise of Warrants.
We covered Paulson's original 13D on CNO in 2009.
Per Google Finance, CNO Financial Group is "a holding company for a group of insurance companies operating throughout the United States, which develops, markets and administers health insurance, annuity, individual life insurance and other insurance products. The Company sells its products through three distribution channels: career agents, independent producers (some of whom sell one or more of its product lines exclusively) and direct marketing. The Company’s operating segments include Bankers Life, Washington National and Colonial Penn, which are defined on the basis of product distribution; Other CNO Business, and corporate operations, consisted of holding company activities and noninsurance company businesses."
You can view additional recent portfolio activity from Paulson here.
Friday, July 11, 2014
What We're Reading ~ Hedge Fund Links 7/11/14
Baupost takes stake in Banco Espirito [ValueWalk]
Carl Icahn says time to be cautious about US markets [CNBC]
Steve Eisman shuts Emrys Partners, says fundamental analysis no longer viable [FINalt]
Paul Singer stands to make over 1,600% return [Here in the City]
Blackstone readies big bet hedge fund [WSJ]
Paulson credit fund gains from Lehman, Rescap and Dex Media [ValueWalk]
Viking Global reshuffles top ranks [HedgeWorld]
Update on Bridgewater's performance [Bloomberg]
Why some family offices are deciding to become hedge funds [GuruFocus]
How to successfully start a hedge fund [eFinancialNews]
Wednesday, July 9, 2014
What We're Reading ~ Analytical Links 7/9/14
The Education of a Value Investor [Guy Spier]
Short selling drops to lowest level since Lehman [FT]
Everything wrong with investor behavior in one article [Reformed Broker]
Another sign the bull market is nearing its end [Marketwatch]
The differences between a portfolio manager and analyst [CFA]
Goodbye malls of America [Bloomberg View]
A look at Western Union [ValueLine]
Profile of mutual fund king Bill Miller [WSJ]
Carlos Slim bows to Mexico telecom reform [Reuters]
15 facts about Dubai [Business Insider]
Hound Partners Increases Carter's Stake
Johnathan Auerbach's hedge fund firm Hound Partners filed an amended 13G with the SEC regarding shares of Carter's (CRI). Per the filing, Hound now owns 6.92% of the company with over 3.7 million shares.
This means they've boosted the number of shares they own by around 10% since the end of the first quarter. The filing was made due to activity on June 12th. Conversely, we pointed out a few months ago that Tiger Global had exited its CRI stake.
We've highlighted other recent portfolio activity from Hound here.
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."
Michael Mauboussin on Skill Versus Luck and Developing an Investment Process
Michael Mauboussin, head of global financial strategies at Credit Suisse, sat down with Motley Fool earlier this year to talk about investing.
In it, he touches on skill versus luck and notes how investors need to have a process. He says this is comprised of 3 things:
1. An analytical component (financial statement analysis, etc)
2. A behavioral component (patterns of mistakes and learning from them)
3. An organizational component (what's going on in your environment that allows you to be more successful)
He admits that evaluating your process is a difficult thing to do, but recommends utilizing an investing journal. Mauboussin says doing this can fight hindsight bias and creeping determinism.
He touches on numerous other topics and embedded below is the full interview with Mauboussin:
For more from Mauboussin, be sure to read his books, The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing as well as Think Twice: Harnessing the Power of Counterintuition.
Tuesday, July 8, 2014
Jeff Saut Predicts Pullback Within Secular Bull Market
It's been quite a while since we checked in on market strategist Jeff Saut's latest commentary, so we figured it's time to see what he's thinking. This week, Saut's investment strategy piece is entitled, "Making a Market Call." In it, he predicts that the market will see the "first decent pullback of the year" in mid-July or early August.
He arrives at this prediction based on various readings and he's advising raising cash levels, comparing it to the summer of 2011 when the market dipped 18%. But taking a step back to the bigger picture, he also believes we're still in the midst of a secular bull market that has years left to run.
Embedded below is Jeff Saut's latest investment strategy piece:
You can download a .pdf copy here.
Hoplite Capital Discloses Sinclair Broadcast Group Stake
John Lykouretzos' hedge fund Hoplite Capital has filed a 13G with the SEC regarding shares of Sinclair Broadcast Group (SBGI). Per the filing, Hoplite now owns 5.2% of the company with over 6 million shares.
This is a newly disclosed equity position for the hedge fund and the filing was made due to activity on June 25th. You can view other portfolio activity from Hoplite here.
Per Google Finance, Sinclair Broadcast Group is a "diversified television broadcasting company. The Company owns or provides certain programming, operating or sales services to more television stations."
JANA Partners Goes Activist on PetSmart
Barry Rosenstein's activist hedge fund JANA Partners has filed a 13D with the SEC regarding shares of PetSmart (PETM). Per the filing, JANA now owns 9.9% of the company and is the company's largest shareholder with over 9.8 million shares. This is a brand new position for them.
The filing notes that JANA expects to meet with management to discuss "strategic alternatives' including a sale of a company, the company's capital structure (and return of capital to shareholders), board composition and other items.
The 13D was filed due to activity on June 23rd. The hedge fund was out buying PETM shares at prices around $57.80 in early June.
For more on this investor, check out Barry Rosenstein at the activist investing panel at the Milken Institute.
Per Google Finance, PetSmart "supplies products, services and solutions for the lifetime needs of pets. The Company operates a website for pet supplies, foods and different animal needs. The Company's stores also feature pet styling salons that offer pet grooming services, from full-service styling to baths, toenail trimming and teeth cleaning."
Wednesday, July 2, 2014
What We're Reading ~ Analytical Links 7/2/14
Spy the Lie: Former CIA Officers Teach You How to Detect Deception [Philip Houston]
On curating your investment resources [Washington Post]
The Buffett valuation indicator: some interesting odds and ends [Advisor Perspectives]
The unpopularity of patience [Clear Eyes Investing]
A look at TIVO [Micro Fundy]
How to win by doing less [Morgan Housel]
Shinzo Abe's bid to shake up corporate Japan [NYTimes]
Cash no longer king as stock, asset swaps drive takeovers [Bloomberg]
Lessons from John Malone [Simoleon Sense]
Target's leadership lost its way long before data breach [WSJ]
The US consumer is on a tear [Business Insider]
Household net worth hits record high [Business Insider]
Embrace stock market investing as a lifestyle [Montreal Gazette]
Investors seek new hedges in unnatural market calm [Reuters]
Monday, June 30, 2014
Peltz's Trian Discloses New Stake in Bank of New York Mellon
Nelson Peltz's activist investment firm Trian Partners has filed an amended 13F with the SEC. Per the filing, they've disclosed a new position in Bank of New York Mellon (BK). This amendment was made to their first quarter 2014 13F filing.
This means that they owned 9,330,230 shares as of March 31st, 2014. In their original Q1 13F, Trian had filed for confidential treatment of their position with the SEC.
For more on this firm, we've posted some of Trian's Q1 letter.
Per Google Finance, Bank of New York Mellon is "a global financial services company. The Company divides its businesses into two principal segments: Investment Management and Investment Services. It has an Other segment, which includes credit-related activities, the lease financing portfolio, corporate treasury activities (including its investment securities portfolio), its equity investments in Wing Hang Bank Limited and ConvergEx Group, business exits and corporate overhead. Its two banks are The Bank of New York Mellon, which houses its institutional businesses, including asset servicing, issuer services, treasury services, broker-dealer and advisor services and the bank-advised business of asset management, and BNY Mellon, National Association (BNY Mellon, N.A.), which houses its wealth management business. In May 2014, the Company acquired HedgeMark International, LLC, a provider of hedge fund managed account and risk analytic services."
Soros Fund Seeks Sale of Penn Virginia
George Soros' family office Soros Fund Management has filed an amended 13D with the SEC on shares of Penn Virginia (PVA). Per the filing, Soros' Chief Investment Officer Scott Bessent has sent a letter that pushes for a sale of the company.
Soros Fund's Letter to Penn Virginia
The letter reads:
"June 25, 2014
Board of Directors
Penn Virginia Corporation
4 Radnor Corporate Center
100 Matsonford Road, Suite 200
Radnor, PA 19087
Gentlemen and Lady:
We are extremely disappointed that, as indicated in the letter we received from Mr. Cloues dated June 18, 2014, Penn Virginia Corporation ("Penn Virginia" or the "Company") has rejected our suggestions to provide additional financial incentives to its management team in the event of a sale. We made those suggestions to further align management's interests with the best interests of shareholders, as we have previously communicated to you our belief that you should explore strategic alternatives as a means to maximize shareholder value. We believe that the optimal means to maximize value is for the Company to be sold. By reasserting in the letter your belief in your operating strategy, it appears to us that you are not going to undertake a formal evaluation of Penn Virginia's strategic alternatives.
As the largest shareholder of Penn Virginia, we are deeply concerned by the Company's recent missteps. Management's presentations at several recent conferences have been underwhelming, culminating in a wholly avoidable revision of its investor presentation type-curve disclosure.1 We believe that these investor relations disasters are the reason why the Company’s stock dropped 14.4% from $16.48 on May 29, 2014 to $14.11 on June 10, 2014, underperforming its peer companies by 15% over that period.2
In light of this poor stretch of share price performance, which we believe was driven almost entirely by the Company’s disappointing investor-relations effort, we were then astounded by the timing of the June 10, 2014 press release announcing Penn Virginia's proposed private offering of convertible preferred stock. The issuance of this convertible preferred stock was at a significant discount to inherent value and diluted existing equity holders by approximately 21%.3 While the timing of this transaction was particularly egregious, the strategic rationale
__________________________ 1 In presentations, the Company revised down its reported type-curves, showing third-party numbers without explaining to investors the reason behind the decrease. It is common in the E&P industry for third-party type-curve estimates to be lower than company estimates. However, without proper disclosure, this revision was taken by investors as a signal that the Company’s wells had started to deteriorate – which we believe is very much not the case. 2 The SIG Oil Exploration & Production Index (“EPX”) rose 0.6% from 537.04 to 540.00 in the same period. 3 $325mm converts at $18.34/share = 17.72mm shares, versus previous fully diluted share-count of 85.7mm shares.
was not much better. The Company's intended use for the proceeds of this offering is to finance the acceleration of its development program and increase its lease acquisition effort in the Eagle Ford Shale. Based on management’s own estimates for the present value created by this accelerated drilling program, however, it is clear this decision has destroyed shareholder value.
We believe that the shares of the Company are fundamentally undervalued, and that issuing equity or equity-linked securities at these prices to accelerate drilling in the manner contemplated fails to optimize per-share value. Other potential owners of this asset have a lower cost of capital and better scale in the Eagle Ford Shale and are clearly its optimal owners. Regrettably, the board’s decision to grow in this dilutive manner indicates to us that it is more interested in “empire building” than maximizing shareholder value.
The board apparently views this decision as one targeted at building the Company for the long run. But we note that this board of directors has presided over a long period of decline at Penn Virginia, which has resulted in a current stock price that is lower than the stock price ten years ago.4 This record of failure to create value over the long term is not a track record that justifies making dilutive transactions today in the hopes that someday in the future the enhanced scale will somehow benefit shareholders more than a sale today would.
Again, we believe that the Company should promptly pursue a sale in order to maximize shareholder value. We believe there are numerous potential acquirers who would be interested in acquiring the Company at a material premium to its current trading price, as demonstrated by any number of precedent transactions in the industry. Decisions about the future direction of your development program should be left to the buyers, who enjoy a considerably lower cost of capital and can therefore accelerate drilling in a more accretive manner.
The time has come for the Company to put itself up for sale as the surest path to maximize shareholder value. Should you fail to start exploring sale alternatives, we reserve the right to take any and all actions we believe necessary to ensure that shareholder value is not further eroded.
Very truly yours,
/s/ Scott Bessent
Scott Bessent
Chief Investment Officer"
Capitalize For Kids Investment Idea Contest
Just a head's up for readers that in conjunction with the upcoming Capitalize For Kids conference, they are also running an Investment Idea Contest we thought many of you would be interested in with the opportunity to allocate some of the winnings to the Hospital for Sick Children. Here are the details:
Prizes:
Winner gets $20,000, complimentary admission to the conference, and a 1-year subscription to Impact Research
2nd place gets $5,000, complimentary admission to the conference, and a 1-year subscription to Actionable Alpha
3rd place gets complimentary admission to the conference and a 1-year subscription to Actionable Alpha
Eligibility: You must be employed full-time in the institutional investment industry and have permission from your employer to compete. MBA students are also welcome to enter.
Deadline: Ideas must be submitted by July 31st, 2014
Apply: You can view more details and apply for the contest via this link.
Embedded below is the flyer for Capitalize For Kids' Intelligent Investing Challenge:
Good luck!
