In this article, we discuss the 10 stocks to sell according to Julian Robertson’s Tiger Management. If you want to skip our detailed analysis of Robertson’s history, investment philosophy, and hedge fund performance, go directly to 5 Stocks to Sell According to Julian Robertson’s Tiger Management.
Billionaire, hedge fund manager and philanthropist Julian Robertson is akin to a superstar in the world of hedge funds. The 89-year-old founded Tiger Management in 1980 with $8 million in start-up capital, and after nearly 18 years of successful investment management and returns using the long-short strategy, turned this amount into $22 billion in 1988. Robertson’s Tiger Management holds one of the best hedge fund records in the world, returning 31.7% annually and beating S&P 500’s 12.7% annual return between the period of 1980 and 1998. This success however, was not long-lived, as a financial plunge due to investor withdrawals caused Robertson’s performance to suffer, resulting in a fall in his overall returns to 26%. Tiger Management eventually closed to outside investors in 2000.
Despite closing his fund, Julian Robertson remained active in the hedge fund business and continued his success for many years, becoming involved with the mentorship and financing of future hedge fund managers. As of 2021, Julian Robertson has a net worth of $4.8 billion. Robertson, speaking on his investment philosophy, said, “mandate is to find the 200 best companies in the world and invest in them, and find the 200 worst companies in the world and go short on them.”
According to the recent 13F Holdings for the second quarter of 2021, some of the top stocks present in Tiger Management’s investment portfolio include Microsoft Corporation (NASDAQ:MSFT), Facebook, Inc. (NASDAQ:FB) and Alphabet Inc. (NASDAQ:GOOG), among others.
Our Methodology
With this background in mind, let us now look towards the 10 stocks to sell according to Julian Robertson’s Tiger Management. We made use of Tiger Management’s 13F portfolio for the second quarter for this analysis. The following list consists of stocks that the hedge fund significantly reduced stakes in, or sold off completely in the second quarter of 2021.
Why should we pay attention to Julian Robertson’s stocks? Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 86 percentage points since March 2017. Between March 2017 and July 2021 our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY. Our stock picks outperformed the market by 86 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
10 Stocks to Sell According to Julian Robertson’s Tiger Management
10. Sea Limited (NYSE:SE)
Number of Hedge Fund Holders: 104
Sea Limited (NYSE:SE) is a leading global consumer tech company based in Singapore that operates in the digital entertainment, e-commerce, and financial services industries. Ranked tenth on the list of the 10 stocks to sell according to Julian Robertson’s Tiger Management, Sea Limited (NYSE:SE) has a market capitalization of $187.96 billion.
Tiger Management reduced its stake in Sea Limited (NYSE:SE) by 52% in the second quarter, ending the period with 7,700 shares of the company.
On August 17, Sea Limited (NYSE:SE) released its quarterly earnings report for the second quarter of 2021, with reported earnings per share at -$0.61, missing estimates by $0.12. The company also reported revenues of $2.28 billion, beating forecast estimates by $262.88 million. At the end of the second quarter of 2021, 104 hedge funds in the database of Insider Monkey held stakes worth $12.2 billion in Sea Limited (NYSE:SE), up from 98 the preceding quarter worth $10.4 billion.
On August 19, CLSA analyst Neel Sinha downgraded Sea Limited (NYSE:SE) to Outperform from Buy with a price target of $352, up from $285, after the company issued its results for the second quarter of 2021.
Unlike Microsoft Corporation (NASDAQ:MSFT), Facebook, Inc. (NASDAQ:FB) and Alphabet Inc. (NASDAQ:GOOG), Sea Limited (NYSE:SE) is one of the stocks that Tiger Management is selling.
In its second-quarter, 2021 investor letter, Tao Value, mentioned Sea Limited (NYSE: SE). Here is what the fund said:
“Sea continued to execute above expectation. The gaming business continued strong momentum, recording bookings of $1.1 billion, growing 117% y-o-y. The major franchise Free Fire showed no sign of slowing down in established ASEAN & LatAm market and received positive reception from new markets
like US. On e-commerce side, Shopee demonstrated early success in expanding to Brazil, by adopting a low-price category & gamification strategy. For 2021, Shopee is now top downloaded e-commerce app in Brazil, almost 2x of the second-place local leader Mercado Libre (MELI). I also see the most promising development is in its FinTech business – SeaMoney, which more than doubled its revenue in Q1 2021 from the previous quarter! With online lending products rolling out, SeaMoney is poised to grow rapidly, becoming the 3rd growth curve for Sea.”
9. AerCap Holdings N.V. (NYSE:AER)
Number of Hedge Fund Holders: 45
AerCap Holdings N.V. (NYSE:AER) is a global leader in aircraft leasing. Some of the activities conducted by the company include leasing, financing and management of commercial aircraft. Ranked ninth on the list of the 10 stocks to sell according to Julian Robertson’s Tiger Management, AerCap Holdings N.V. (NYSE:AER) has a market capitalization of $7.79 billion.
Julian Robertson’s hedge fund reduced its stake in AerCap Holdings N.V (NYSE:AER) by 48% in the second quarter, with only 799,534 shares left by the end of the period.
The company released its quarterly earnings report for the second quarter of 2021 on July 29, with reported earnings per share at $1.92, surpassing forecast estimates by $0.52. In addition, the company also reported revenues of $1.23 billion, beating market estimates by $210.63 million. At the end of the second quarter of 2021, 45 hedge funds in the database of Insider Monkey held stakes worth $1.42 billion in AerCap Holdings N.V. (NYSE:AER), up from 43 hedge funds in the preceding quarter with stakes worth approximately $1.67 billion.
Out of the hedge funds being tracked by Insider Monkey, New York-based investment firm Eagle Capital Management is a leading shareholder of AerCap Holdings N.V. (NYSE:AER) with over 6.85 million shares worth more than $350.8 million.
Unlike Microsoft Corporation (NASDAQ:MSFT), Facebook, Inc. (NASDAQ:FB) and Alphabet Inc. (NASDAQ:GOOG), AerCap Holdings N.V. (NYSE:AER) is one of the stocks that Tiger Management is selling.
Horos Asset Management, in its Q1 2021 investor letter, mentioned AerCap Holdings N.V. (NYSE:AER). Here is what the fund said:
“AerCap, the leading aircraft leasing company, announced this quarter the acquisition of GECAS, the other major player in the sector, in exchange for 111.5 million shares, $24 billion in cash and another $1 billion in AerCap bonds or cash. At the price at which AerCap was trading at the time, the company was acquiring the GECAS fleet at c. 10% discount. This move is definitely reminiscent of others of similar size made by the company. In particular, this acquisition has important similarities with that of ILFC in 2013. Firstly, both belonged to a forced seller: the insurer AIG in the case of ILFC and General Electric in the case of GECAS. Secondly, like GECAS, ILFC was one of the big players in the sector. Also, the acquisition of ILFC was made at a discount on its fleet (15%) and gave AerCap access to an attractive order book for new aircraft—just like the current deal does now. Finally, AerCap sold those ILFC aircraft that did not fit its long-term strategy, and then repurchased shares at a deep discount to the company’s NAV, creating tremendous value for its shareholders. Will it make a similar move after the GECAS acquisition?
As for the differences, we think that GECAS has a “cleaner” fleet, as it has been making fleet adjustments for years. It also brings new divisions to AerCap, such as the engine leasing business (quite attractive) or the helicopter leasing business (potential future divestment). Additionally, it is noteworthy that, on this occasion, AerCap will have a less leveraged balance sheet after the transaction (most likely something needed to finance such a large acquisition)…” (Click here to see the full text)
8. TAL Education Group (NYSE:TAL)
Number of Hedge Fund Holders: 27
TAL Education Group (NYSE:TAL) is a holding company that engages in the provision of after-school tutoring programs for primary and secondary school students. Its services are delivered through premium services, including one-on-one tutoring and online course offerings. Ranked eighth on the list of the 10 stocks to sell according to Julian Robertson’s Tiger Management, TAL Education Group (NYSE:TAL) has a market capitalization of $2.91 billion.
Tiger Management sold its entire stake in TAL Education Group (NYSE:TAL) in the second quarter.
For the second quarter of 2021, the company reported earnings per share at $0.08, missing estimates of $0.11 by $0.03. In addition, the company also reported revenues at $1.10 billion, falling short of the estimated revenues by $21.40 million. At the end of the second quarter of 2021, 27 hedge funds in the database of Insider Monkey held stakes worth $606.7 million in TAL Education Group (NYSE:TAL). This is compared to 38 hedge funds in the preceding quarter with stakes worth approximately $1.37 billion.
Out of the hedge funds being tracked by Insider Monkey, Jonathan Guo’s Yiheng Capital is a leading shareholder of TAL Education Group (NYSE:TAL) with over 5.77 million shares worth more than $145 million.
In the Q2 2021 investor letter of Tao Value, the fund mentioned TAL Education Group (NYSE:TAL). Here is what the fund said:
“On detracting side, our largest loss came from our recent new education positions, TAL. New legislation on both private K9 education & private tutoring materialized in the past quarter, and they turned out to be irrationally harsher & broader than anticipated. When such worst scenario fold out, the prospects of the company undoubtably has changed significantly. Although I believe that market overreacted on this company, it appears that I have made a mistake underestimating the regulatory impact and picking it up too soon. Our position sizes reflected my evaluation of the risk, and I decide to stay put.”
7. NXP Semiconductors N.V. (NASDAQ:NXPI)
Number of Hedge Fund Holders: 52
NXP Semiconductors N.V. (NASDAQ:NXPI) is a semiconductor manufacturer based in the Netherlands that focuses on the manufacture and sales of semiconductors primarily for the automotive industry. Ranked seventh on the list of the 10 stocks to sell according to Julian Robertson’s Tiger Management, NXP Semiconductors N.V. (NASDAQ:NXPI) has a market capitalization of $57.45 billion.
By the end of the second quarter, Tiger Management sold off its entire stake in the company.
On August 2, NXP Semiconductors N.V. (NASDAQ:NXPI) released its quarterly earnings report for the second quarter of 2021, with reported earnings per share at $2.39, beating estimates by $0.07. The company also reported revenues of $2.60 billion, surpassing forecast estimates by $19.51 million. At the end of the second quarter of 2021, 52 hedge funds in the database of Insider Monkey held stakes worth over $1.33 billion in NXP Semiconductors N.V. (NASDAQ:NXPI). This is compared to 53 hedge funds in the preceding quarter with stakes worth approximately $1.71 billion.
On September 3, investment advisory Argus initiated coverage of NXP Semiconductors N.V. (NASDAQ:NXPI) stock with a Buy rating and a price target of $260.
Out of the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in NXP Semiconductors N.V. (NASDAQ:NXPI) with 1 million shares worth more than $212 million.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and NXP Semiconductors N.V. (NASDAQ:NXPI) was one of them. Here is what the fund said:
“Within IT, we have also increased exposure to a cyclical semiconductor industry currently working through a severe supply shortage due to several years of capacity reductions, COVID-19 shutdowns and one-off production delays as well as demand resilience in areas like autos and smartphones. Two recent additions, specialty semiconductor maker (including) NXP Semiconductors, was among the portfolio’s leading contributors in the first quarter. NXP rose as auto production ramped up and electric vehicle sales continued to expand.”
6. Momentive Global Inc. (NASDAQ:MNTV)
Number of Hedge Fund Holders: 28
Momentive Global Inc. (NASDAQ:MNTV) is an experience management company that offers cloud-based software to support market insights and project development. Ranked sixth on the list of the 10 stocks to sell according to Julian Robertson’s Tiger Management, Momentive Global Inc. (NASDAQ:MNTV) has a market capitalization of $2.84 billion.
Julian Robertson’s hedge fund reduced its stake in the company by 100% in the second quarter, selling off all the shares it held in Momentive Global Inc. (NASDAQ:MNTV) by the end of the period.
On August 4, Momentive Global Inc. (NASDAQ:MNTV) issued its quarterly earnings report for the second quarter of 2021, with reported earnings per share at -$0.01, missing estimates by $0.01. The company also reported revenues of $109.39 million, beating market estimates by $1.96 million. At the end of the second quarter of 2021, 28 hedge funds in the database of Insider Monkey held stakes worth over $238.7 million in NXP Semiconductors N.V. (NASDAQ:NXPI). This is compared to 32 hedge funds in the previous quarter with stakes worth approximately $204 million.
Out of the hedge funds being tracked by Insider Monkey, California-based investment firm Park West Asset Management is a leading shareholder in Momentive Global Inc. (NASDAQ:MNTV) with 1.97 million shares worth more than $41.6 million.
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Disclosure: None. 10 Stocks to Sell According to Julian Robertson’s Tiger Management is originally published on Insider Monkey.
