Billionaire Rob Citrone’s Biggest Q4 Moves

Charles Schwab Corp (NYSE:SCHW)

– Shares Owned by Discovery Capital Management (as of December 31): 9.04 million

– Value of Holding (as of December 31): $297.70 million

Considering that Charles Schwab Corp (NYSE:SCHW)’s stock has fallen by nearly 25% so far this year, it seems Discovery Capital Management move to increase its stake in the company by 175% during the fourth quarter isn’t looking wise at the moment. The large decline caused the company’s trailing price to earnings multiple to fall below 24.00 recently, the lowest it has been in the past two-and-a-half years. For the fourth quarter, the company reported EPS of $0.28 on revenue of $1.69 billion, compared to EPS of $0.25 on revenue of $1.55 billion that it reported for the same quarter of the previous year. On February 19, analysts at Barclays reiterated their ‘Buy’ rating on the stock, but lowered their price target on it to $31 from $32. John Armitage‘s Egerton Capital Limited also increased its stake in the company during the fourth quarter, by 24% to nearly 9.5 million shares.

Pfizer Inc. (NYSE:PFE)

– Shares Owned by Discovery Capital Management (as of December 31): 14.58 million

– Value of Holding (as of December 31): $470.83 million

Moving on, owing largely to Discovery Capital Management increasing its stake in the company by 51%, Pfizer Inc.(NYSE:PFE) jumped two places quarter-over-quarter to become the fund’s second-largest equity holding as of the end of December. Shares of Pfizer Inc.(NYSE:PFE) have been on a consistent downtrend since it announced its $160 billion acquisition of Allergan plc Ordinary Shares (NYSE:AGN) last November and are currently trading down by over 7% in 2016. The FDA recently approved Pfizer.’s breast cancer medication IBRANCE for extended use, which several analysts are viewing as a major positive development for the company. While regulators are concerned about the Pfizer/Allergan deal because it will result in a tax loss for the U.S after Pfizer changes its domicile to Ireland, analysts are buoyant about it, since the drug pipelines of the two companies have very little overlap.

Alibaba Group Holding Ltd (NYSE:BABA)

– Shares Owned by Discovery Capital Management (as of December 31): 10.60 million

– Value of Holding (as of December 31): $861.54 million

Amid a 37.8% rise in Alibaba Group Holding Ltd (NYSE:BABA)’s stock during the fourth quarter, Discovery Capital Management increased its stake in the company by 62%. The slump in the Chinese stock market this year has caused several Chinese companies to lose a lot of their value, however Alibaba Group Holding Ltd (NYSE:BABA)’s stock has fared much better in comparison, with a year-to-date loss of only 14.67%. Following the decline, Alibaba Group Holding Ltd (NYSE:BABA) currently trades at a miniscule forward price-to-earnings multiple of 3.12, which analysts believe is abysmally low for a growing tech company centered in a market that is still growing itself by considerably more than developed markets, even if that growth is beginning to slow. In its latest 13F filing, Alibaba Group Holding Ltd disclosed that it owned 33 million shares of U.S deal site Groupon (NASDAQ:GRPN) at the end of December. This has raised speculation among investors that the former is planning to acquire the latter. Daniel S. Och‘s OZ Management reduced its stake in Alibaba by 76% to 1.78 million shares during the October-to-December period.

Disclosure: None