Ivory Investment Management L.P. is a Los Angeles-based research-intensive hedge fund firm founded by Curtis Macnguyen in 1998. The hedge fund currently employs one long and two long/short investment strategies. Initially, the fundamental value-based investment firm was financed with seed capital from outside investors amounting to $10 million and it has managed to deliver quite exceptional returns despite focusing on this relatively “old-fashioned” investment approach. The flagship fund of Ivory Investment Management has delivered a cumulative return of 346% since its inception, more than doubling the 139% cumulative return delivered by the Standard & Poor’s 500 Index during the same period. Therefore, the fund has generated an annualized return of as much as 9.7% since its establishment, which represents an attractive return considering the economic turmoil experienced throughout the last decade. As shown in the fund’s latest 13F filing, the value of its public equity portfolio stands at $4.23 billion. In the following article we will list and discuss the top new picks of Curtis Macnguyen, which include the following companies: Western Digital Corporation (NASDAQ:WDC), St. Jude Medical Inc. (NYSE:STJ), Bank of America Corporation (NYSE:BAC) and Delta Air Lines Inc. (NYSE:DAL).
Ivory Investment Management is just one of more than 700 hedge funds that we have in our database, whose equity portfolios we collate quarterly as part of our small-cap strategy. Even though most smaller investors believe that tracking 13F filings is a fruitless endeavor because they are filed with a delay of a maximum of 45 days after the end of a calendar quarter, the results of our research prove that is not the case. To be on the safe side, we used a delay of 60 days in our backtests that involved the 13F filings of funds between 1999 and 2012 and we still managed to gain an annual alpha in the double digits. Moreover, since the official launch of our strategy in August 2012, our small-cap strategy has obtained returns of more than 142%, beating the S&P 500 Total Return Index by greater than 83 percentage points (see the details).
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That latest 13F filing reveals that Ivory Investment Management has taken a long position in Western Digital Corporation (NASDAQ:WDC). Macnguyen purchased a stake of 1.56 million shares worth $141.83 million during the first quarter, which, considering the fact that shares of Western Digital have plummeted by 17% year-to-date, might represent that it’s a really cheap buying opportunity for bottom-fishing investors at the moment. This idea is also supported by the research team at Goldman Sachs, which recently upgraded the stock to a “Buy” rating from a “Neutral” one. At the same time, the reputable investment banking firm also raised the stock’s price target to $122 from $106, which yields a potential 33% upside for investors. Within our database, Ken Griffin’s Citadel Investment Group is the largest investor in Western Digital Corporation (NASDAQ:WDC), owning 3.07 million shares valued at $279.41 million.
Ivory Investment Management also acquired a 1.73 million share-stake in St. Jude Medical Inc. (NYSE:STJ), with the stake valued at $113.29 million. Despite the fact that the stock is already up 13% in 2015, it might keep rising in the upcoming months as the company has been constantly introducing new revolutions and products to the market. On June 4, the company announced the CE Mark approval for the St. Jude Medical Invisible Trial System in Europe, which is an app-based and wireless neuromodulation programming system. Therefore, the newly-launched system provides a secure, safe and wireless experience when patients trial spinal cord stimulation for the remedy of chronic pain. This is only one of the high number of launches and developments St. Jude Medical has been announcing lately, so the company and the stock have more room to grow in the future. David Stemerman’s Conatus Capital Management is among the largest shareholders in St. Jude Medical Inc. (NYSE:STJ) from the hedge funds we track, owning 1.32 million shares, trailing only Macnguyen.
