Alok Agrawal’s Bloom Tree Partners is one of the leading global long/short equity funds. The fund manages a 13F portfolio of $668 million as of the end of 2014. The fund’s primary strategy is determining undervalued companies for its long portfolio and overvalued companies for its short portfolio by using extensive fundamental research. As of the end of last year, Bloom Tree’s favorite picks were Google Inc (NASDAQ:GOOG), FleetCor Technologies, Inc. (NYSE:FLT), Comcast Corporation (NASDAQ:CMCSA), Cheniere Energy, Inc. (NYSEMKT:LNG) and Twitter Inc (NYSE:TWTR).
We are tracking hedge funds and other investment managers like Bloom Tree Partners because we want to benefit from their intelligent investment ideas. These hedge funds have enough experience and skills to find undervalued stocks and we can discover some their stock picks from their SEC filings. However, the key of outperforming the market and even beating most equity funds is to focus on the most popular-small-cap stocks among them. Our detailed studies have shown that we can achieve better returns than most of the hedge funds by imitating their top 15 small-cap ideas. During the last 2.5 years, these top 15 small-cap ideas of hedge funds generated a cumulative return of 131.4% vs. S&P 500 ETF (SPY)’s return of 57.2% in the same time period (read the details here).
Alok Agrawal’s Bloom Tree Partners held a $51.13 million stake in Google Inc (NASDAQ:GOOG) at the end of 2014, which contained 97,100 class C shares, up by 70% on the quarter. Google Inc (NASDAQ:GOOG), one of the largest tech giants with a market cap of $364 billion has recently announced the financial results for the first quarter of 2015. The company recorded a revenue of $17.26 billion, up from $15.42 billion a year earlier and net income advanced to $3.59 billion from $3.45 billion in the same quarter of the previous year. Another shareholder of Google is Boykin Curry’s Eagle Capital Management, which held 1.12 million class C shares at the end of 2014.
Alok Agrawal’s other favorite pick is FleetCor Technologies, Inc. (NYSE:FLT). The company provides fuel and specialized payment products and services worldwide. Bloom Tree had a $41.6 million position in the company, which contained 280,100 shares, up by 67% during the last quarter of 2014. FleetCor Technologies, Inc. (NYSE:FLT) announced its first quarter financial results at the end of April. The company increased its revenues by 64% on the year to $416.2 million and its net income went up to $94.2 million from $75.1 million in the first quarter of 2014. FleetCor Technologies, Inc. (NYSE:FLT) completed acquisition of Comdata in the last quarter of 2014 and analysts are expecting the synergies obtained by this acquisition to support the company’s financial performance to reach beyond expectations in the coming quarters. Stephen Mandel’s Lone Pine Capital and Daniel Och’s Oz Management are two prominent investors in the company, among the funds we track
Alok Agrawal also had $38 million invested in Comcast Corporation (NASDAQ:CMCSA) at the end of 2014, the position containing 653,800 shares. The company has a market cap of $148 billion, P/E ratio of 18 and its stock inched up by 0.2% since the end of 2014. Comcast Corporation (NASDAQ:CMCSA) recently terminated its agreement to acquire Time Warner Cable, disappointing investors who were betting on the consolidation of the cable industry. Among the funds from our database, the largest position in Comcast Corporation (NASDAQ:CMCSA) is held by Lansdowne Partners, which disclosed 24.77 million shares in its last 13F filing.
Cheniere Energy, Inc. (NYSEMKT:LNG) is another favorite pick of Alok Agrawal, in which the investor held 653,800 shares, valued at $37.93 million. Agrawal increased his holding in Cheniere Energy, Inc. (NYSEMKT:LNG) by 128% in the last quarter of 2014. Seth Klarman’s Baupost Group and Andreas Halvorsen’s Viking Global also increased their positions in the oil and gas midstream company. These bets proved to be profitable as the stock of Cheniere Energy, Inc. (NYSEMKT:LNG) appreciated by more than 10% since the beginning of 2015.
Alok Agrawal’s other favorite pick is Twitter Inc (NYSE:TWTR), although it didn’t rank among its top picks. The investment paid out well during the first three months of the current year, as the stock of the $25 billion social network company jumped by 39%. However, following disappointing financial results reported last week, the stock took a hit and lost more than 25% in the last five days alone, erasing most of the previous gains. Since the current round of 13F filings is not over, we cannot assess the popularity of the stock at the end of March in order to see whether the investors anticipated this development, but the previous round of filings showed a significant outflow of cash among the funds that we track. At the end of 2014, 42 investors held an aggregate of $1.01 billion worth of Twitter Inc (NYSE:TWTR),’s stock, down from 59 funds with $2.03 billion a quarter earlier. John Thaler’s JAT Capital Management held around 10% of its equity portfolio invested in Twitter at the end of 2014, holding 7.26 million shares. One of the funds that went long Twitter Inc (NYSE:TWTR), during the first quarter is Donald Chiboucis’ Columbus Circle Investors, which revealed 324,700 shares in its latest 13F filing.
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