Douglas Dillard and Raj D. Venkatesan’s Standard Pacific Capital LLC has filed its 13F for the reporting period of March 31, disclosing its equity holdings as of the end of the first quarter of 2015. Both the founders of Standard Pacific Capital are graduates from the Harvard Business School and the pair currently manage an equity portfolio valued at $123.38 million as of the reporting period. Standard Pacific Capital is primarily invested in the consumer discretionary, information technology, materials, and industrial sectors. In this feature we’ll discuss the top technology picks of the fund.
Standard Pacific Capital is just one of more than 700 hedge funds housed 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 rather pointless effort 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 even 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, simply from imitating the top small-cap picks of these funds. Since the official launch of our strategy in August 2012, this small-cap strategy has obtained returns of more than 137%, beating the S&P 500 Total Return Index by 82 percentage points (see the details).
Facebook Inc (NASDAQ:FB) is the largest tech holding of the fund, with Standard Pacific owning 79,586 shares of the social networking company, with a market value of $6.54 million as of the reporting period. Shares of Facebook have declined by more than 8% since its first quarter 2015 earnings report was released on April 22. The social media giant did manage to meet market expectations in terms of revenue and non-GAAP earnings, reporting revenue of $3.54 billion, which was 42% higher than the prior year period. However, Facebook Inc (NASDAQ:FB)’s operating expenses during the first quarter were a hefty 83% higher quarter on quarter. Stephen Mandel‘s Lone Pine Capital, along with Coatue Management and Citadel Investment Group are among the largest shareholders of Facebook Inc (NASDAQ:FB).
Standard Pacific initiated a new position in Yahoo! Inc. (NASDAQ:YHOO) during the first quarter of 2015, reporting ownership of 118,902 shares of the internet and technology company, with those shares having a market value of $5.28 million as of the reporting period. Shares of Yahoo have declined 14.88% year-to-date amid the depreciating value of its stake in Alibaba Group Holding Ltd (NYSE:BABA), among other things. While talking on CNBC, Eric Jackson, founder and president of Ironfire Capital, denied any chance of Yahoo! Inc. (NASDAQ:YHOO) buying Yelp Inc (NYSE:YELP) due to limited cash availability. This seemingly puts an end to the speculation that Yahoo would participate in a bidding war for the online business directory. Yahoo! Inc. (NASDAQ:YHOO) disclosed its first quarter 2015 financial results on March 31, reporting an 8% increase in revenue from the year-ago period. The tech giant also reported an increase in its search volume, which stood at a five-year high during the first quarter of 2015. D E Shaw, York Capital Management, and Christian Leone‘s Luxor Capital Group are among the largest investors in Yahoo.
Priceline Group Inc (NASDAQ:PCLN) is another new addition to the equity portfolio of Standard Pacific Capital. Its new position in the online travel company consists of 4,243 shares with a market value of $4.94 million. Priceline Group is an online travel company that facilitates travel reservations between consumers and travel services. Priceline announced the acquisition of hotel-data company PriceMatch earlier this month, to upgrade the user experience at its recently launched Book.com business division. Terms of that deal were not disclosed. Priceline Group Inc (NASDAQ:PCLN) reported gross profit of $1.7 billion in the first quarter of 2015, which was 19% higher than the prior year period. It also reported GAAP net income of $333 million, which was slightly higher than the previous year earnings of $331 million. Some of the top shareholders of Priceline include Lone Pine Capital, Appaloosa Management LP and Blue Ridge Capital.
Google Inc (NASDAQ:GOOGL) is another new tech holding of Standard Pacific, with the fund owning 8,008 shares of the company’s Class C shares, which have a market value of $4.38 million as of the reporting period. The search engine giant missed Wall Street expectations in terms of revenue and profit in the first quarter of 2015, reporting net revenue of $17.26 billion for the quarter, with analysts at Thomson Reuters expecting revenue of $17.5 billion. That revenue was, nonetheless, 12% higher than the prior year period. Google Inc (NASDAQ:GOOGL) is facing competition in the mobile advertising domain from the likes of Facebook, which was partly responsible for Google introducing a new search algorithm towards the end of April favoring mobile-optimized sites, which has proven to be a somewhat controversial decision (and a costly one for those businesses not running such sites). Eagle Capital Management, Fisher Asset Management, and Andreas Halvorsen‘s Viking Global are among the biggest shareholders of Google Inc (NASDAQ:GOOGL).
Disclosure: None
