Billionaire Andreas Halvorsen Buys Shares of New Public Company, Bill Gates’ Cascade Bullish on AutoNation Inc. (AN), and More

Although the hedge fund industry as a whole lost money in 2015, the top 20 hedge fund managers generated roughly $15 billion net of fees last year. Therefore, numerous investors continue to monitor hedgies’ moves as part of a broader stock selection and analysis process. But how do investors track hedge funds’ moves? A very commonplace practice is to keep a close eye on the abundant pool of 13D, 13G, and Form 4 filings, some of which may disclose valuable information for individual investors. For that reason, the following article will discuss five noteworthy filings identified by our team, which were submitted with the SEC by several successful money managers earlier this week.

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According to a Form 4 filing, Andreas Halvorsen’s Viking Global and its affiliates currently own 2.73 million shares of Editas Medicine Inc. (NASDAQ:EDIT). The filing revealed that 4.44 million shares of Series B Preferred Stock was automatically converted into 1.71 million shares of common stock in connection with the company’s initial public offering (IPO). At the same time, the Viking funds purchased 1.00 million shares at an IPO price of $16.00 and also acquired 20,407 shares at a price of $18.00 per share in open-market transactions after the IPO. Earlier this month, the genome editing company went public by selling 6.79 million shares of common stock, which included 885,000 greenshoe options. Editas Medicine Inc. (NASDAQ:EDIT) develops a proprietary genome editing platform based on a new technology called CRISPR/Cas9, which has the potential to make directed changes in DNA. The company’s most advanced research program aims at addressing a specific genetic form of progressive blindness named LCA10, while its tests have already shown that it is possible to successfully correct the LCA10 gene defect. Editas Medicine intends to start a clinical trial in 2017. In the meantime, Editas’ shares are trading visibly below the IPO price of $16.00, so individual investors could join the list of shareholders by paying a lower price than billionaire Halvorsen.

Let’s move on to the next two pages of this article, where we discuss four other filings submitted by reputable money managers monitored by our team.

As revealed in another Form 4 filing, Matthew Lindenbaum’s Basswood Capital Management and its affiliates sold 56,865 shares of Bridge Bancorp Inc. (NASDAQ:BDGE) at prices in the range of $27.50 to $27.75 per share, trimming their aggregate stake to 1.61 million shares. The bank holding company that conducts operations through its wholly-owned subsidiary Bridgehampton National Bank had a great 2015 in terms of financial performance. The company reported record core net income of $27.3 million for 2015, which was up 49% year-on-year. In the meantime, the stock is up by 11% over the past 12-month period despite losing 8% since the beginning of 2016. The recent slump in the company’s share price has made stock cheaper, but not cheap enough to call it attractive. The stock trades at a forward P/E multiple of 11.40, which compares with the ratio of 10.7 for the regional banks industry. Billionaire Jim Simons’ Renaissance Technologies owned 70,900 shares of Bridge Bancorp Inc. (NASDAQ:BDGE) at the end of September.

Another Form 4 filing showed that Cascade Investment LLC, the investment arm of billionaire Bill Gates, managed by Michael Larson, bought 273,951 shares of AutoNation Inc. (NYSE:AN) last Thursday at prices varying from $44.99 to $46.93 per share. After the recent purchase, Cascade holds a stake of 17.12 million shares of Autonation, which account for 15.48% of the company’s outstanding common stock. The shares of the largest automotive retailer in the nation are down by nearly 23% year-to-date, mainly due to growing concerns that the rising interest rates could hinder auto finance and that auto sales might have reached their peak last year.

The company generated total revenue of $20.86 billion last year, as compared to $19.11 billion reported a year earlier. At the same time, AutoNation Inc. (NYSE:AN)’s new vehicle unit sales reached $12.00 billion for 2015, up from $10.97 billion in 2014. Most importantly, the average age of cars and trucks in the U.S. reached a record high of 11.5 years, which compares with the average of 9.8 years in the period of 2002 to 2007. Hence, it is highly likely that AutoNation will be able to achieve new vehicle unit sales growth in 2016 due to increasing replacement demand. It should be noted that the stock trades at a forward P/E ratio of 9.57, while the average for the S&P 500 Index totals 15.87. David Harding’s Winton Capital Management upped its position in AutoNation Inc. (NYSE:AN) by 118,381 shares during the fourth quarter to 560,351 shares.

In a newly-amended 13D filing, Jeffrey Bronchick’s Cove Street Capital LLC reported owning 3.17 million shares of Forestar Group Inc. (NYSE:FOR), which make up 9.4% of the company’s outstanding common stock. The hedge fund firm has not bought or sold shares since the last time Insider Monkey discussed the fund’s previous 13D filing on the company. Nonetheless, the company recently has reached an agreement with Carlson Capital L.P. and Cove Street Capital LLC, under which Richard D. Squires of Lennox Capital Partners and Ashton Hudson of Rock Creek Capital were appointed to the company’s Board of Directors. Similarly, Kathleen Brown and Charles W. Matthews resigned, so the size of the Board remained unchanged.

Forestar Group Inc. (NYSE:FOR) operates through three business segments: real estate, oil and gas, and other natural resources. The company’s real estate segment revenues (account for 68% of total revenues), mainly derived from the sale of residential single-family lots and tracts, underdeveloped land and commercial real estate, declined to $100.20 million for the nine months that ended September 30 from $153.10 million reported a year ago. Forestar Group will release its fourth-quarter earnings report on February 17, which may trigger a rebound for the company’s stock should financial results please investors. Forestar’s shares have lost more than 39% over the past 52 weeks. Clint Carlson’s Carlson Capital owned 1.05 million shares of Forestar Group Inc. (NYSE:FOR) at the end of September.

According to a Schedule 13G filing, Jeffrey Gates’ Gates Capital Management currently owns 4.30 million shares of Flotek Industries Inc. (NYSE:FTK), which constitute 8.0% of the company’s outstanding common stock. This compares with the stake of 4.57 million shares disclosed through the hedge fund’s 13F for the third quarter of 2015. The shares of the supplier of oilfield products, services, and equipment are down 61% over the past 12 months. The company’s consolidated revenues for 2015 declined by 25.6% to $334.36 million, primarily as a result of a decrease in oilfield market activity. The average North American active rig count decreased by 47.8% during 2015, which clearly explains the company’s disastrous financial and stock performance. It is highly unlikely that Flotek Industries Inc. (NYSE:FTK)’s performance will improve materially this year, but the company’s international Teledrift business is anticipated to be strong in 2016 despite experiencing worsening market conditions. Charles Paquelet’s Skylands Capital lifted its position in Flotek Industries Inc. (NYSE:FTK) by 39,600 shares during the fourth quarter to 239,600 shares.

Disclosure: None