Priceline.com Inc (NASDAQ:PCLN)
Along with Google Inc (NASDAQ:GOOG), this was Lone Pine’s largest position at the time of the fund’s fourth-quarter 13-F filing. The stake was valued at roughly $1.1 billion at the beginning of the year. The stock first showed up in the hedge fund’s filing from the first-quarter of 2011. Like Google, Lone Pine initially purchased a small stake and continued to add to the position as the stock rose. The initial position was only around 360,000 shares valued at $181.4 million. By the fourth-quarter of 2012, the position had been increased to 1,771,000 shares.
Both Google Inc (NASDAQ:GOOG) and Priceline.com Inc (NASDAQ:PCLN) have been major drivers of Lone Pine’s performance during the life cycle of the investments. Year-to-date, Priceline.com shares have risen around 15% and the stock has gone from $400 at the beginning of 2011 to above $700 in recent weeks.
Cognizant Technology Solutions Corp (NASDAQ:CTSH)
This stock was Lone Pine’s third-largest position at the end of Q4 2012. The firm owned almost 11,000,000 shares valued at over $800 million. This made the hedge fund the fifth largest shareholder of Cognizant Technology with a 3.62% stake. The stock has been a relatively long-term holding for the fund, with Cognizant first showing up on Lone Pine’s 13-F filing from the first-quarter of 2010. The Teaneck, New Jersey-based company, which has a market cap of just under $24 billion, is a global information technology, consulting and business process outsourcing firm. The stock has been range bound in recent years after experiencing a substantial run-up in 2010. Based on the timing of the fund’s purchase, it is likely that Mandel’s firm has made a solid profit on its investment.
Dollar General Corp. (NYSE:DG)
Based on an analysis of Lone Pine’s 13-F filings, Dollar General is another example of a stock that the hedge fund purchased a small amount of at first before subsequently making it a major portfolio holding. Dollar General was purchased by Lone Pine in the second-quarter of 2010. The original position, however, was only around 2,400,000 shares valued at $66 million. That compares to the more than 13,000,000 shares valued at roughly $588 million held by Lone Pine at the beginning of 2013. Interestingly, Mandel’s firm also owned a very substantial stake in competitor Dollar Tree and the hedge fund has also traded in Family Dollar shares previously. Dollar General has risen sharply since 2010 with the stock currently trading at around $48.
Conclusion
There are literally thousands of different symbols listed on the various stock exchanges. For the average investor looking to take control of their retirement savings, picking suitable stocks can be daunting. For this reason, 13-F filings are a terrific tool. Many of the top performing hedge funds hold fairly concentrated portfolios that may only include a few dozen stocks out of the thousands of listed companies. Individual investors who shadow these hedge funds’ moves, or use 13-Fs to generate ideas, should feel confident in their strategy as the stocks that show up in these filings have been vetted by some of the top investment minds in the world. Investors that use this strategy don’t have to pay the hefty fees charged by hedge funds in order to profit off of the best ideas of legendary stock pickers like Stephen Mandel.
The article Billionaire Top Stocks: Stephen Mandel’s Favorite Picks! originally appeared on Fool.com and is written by Ryan Glosier.
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