Hedge Fund Limestone Value Partners Is Snapping Up These Declining Stocks

Limestone Value Partners, led by Douglas Dunn and Vincent Soler, recently filed its 13F form with the U.S. Securities and Exchange Commission for the reporting period ending September 30. Limestone disclosed a public equity portfolio, valued at $81.84 million. The filing showed that the fund invested a large amount of money in real estate and energy stocks. In this article, we’ll take a look at Limestone’s top stock picks, including Microsoft Corporation (NASDAQ:MSFT), for the quarter.

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Lets discuss Limestone’s top stocks.

Realogy Holdings Corp (NYSE:RLGY)

Shares Owned by Limestone (as of September 30): 255,400

Value of Limestone’s Shares (as of September 30): $9.61 million

Percentage of Limestone’s Public Equity Portfolio (as of September 30): 11.74%

Shares Owned by Limestone (as of June 30): 223,400

Third Quarter Returns: -19.46%

Limestone seems to be a big fan of New Jersey-based Realogy Holdings Corp (NYSE:RLGY), a residential real estate franchiser and a provider of real estate brokerage, relocation, and title and settlement services. The fund increased share ownership in Realogy Holdings Corp (NYSE:RLGY) by 14% during the quarter. The company had impressive financial results for the second quarter, with net income increasing by 43% to $97 million, compared to the prior year quarter. Revenue for the quarter rose by 9% to $1.7 billion, compared to 2014. Realogy Holdings Corp (NYSE:RLGY) lost 13% year-to-date and nearly 20% during the third quarter. Another large investor of the company is Stephen Mandel’s Lone Pine Capital, owning more than 10 million shares.

Buckeye Partners L.P. (NYSE:BPL)

Shares Owned by Limestone (as of September 30): 144,900

Value of Limestone’s Shares (as of September 30): $8.59 million

Percentage of Limestone’s Public Equity Portfolio (as of September 30): 10.49%

Shares Owned by Limestone (as of June 30): 0

Third Quarter Returns: -18.48%

Buckeye Partners L.P. (NYSE:BPL) is a new position initiated by Limestone during the third quarter. Buckeye Partners L.P. (NYSE:BPL) owns and operates a diversified network of integrated assets providing midstream logistic solutions. Financial health of the company seems impressive, as the company’s second quarter income increased to $91.3 million, versus $61.9 million in 2014. Shares of Buckeye Partners L.P. (NYSE:BPL) lost more than 8% year-to-date. Nearly 19% decline in the stock and increasing earnings must have been enough to trigger a large purchase for Limestone Value Partners.

HFF Inc. (NYSE:HF)

Shares Owned by Limestone (as of September 30): 185,029

Value of Limestone’s Shares (as of September 30): $6.25 million

Percentage of Limestone’s Public Equity Portfolio (as of September 30): 7.63%

Shares Owned by Limestone (as of June 30): 152,811

Third Quarter Returns: -19.10%

In HFF Inc. (NYSE:HF), Limestone upped its position by over 20% during the quarter amid a 19% decline in the stock. Having a market cap of $1.40 billion, HFF Inc. (NYSE:HF) is engaged in providing commercial real estate and capital markets services. For the second quarter, the company reported revenues of $125.0 million, up from $94.8 million in the same quarter last year. Its income rose to $21.2 million, versus $12.6 million in the last year quarter. HFF Inc. (NYSE:HF)’s stock gained nearly 3% year-to-date. Ken Heebner’s Capital Growth Management is among the largest shareholders of the company, with share ownership of 1.12 million shares.

Twenty-First Century Fox Inc (NASDAQ:FOX)

Shares Owned by Limestone (as of September 30): 226,000

Value of Limestone’s Shares (as of September 30): $6.12 million

Percentage of Limestone’s Public Equity Portfolio (as of September 30): 7.47%

Shares Owned by Limestone (as of June 30): 185,000

Third Quarter Returns: -15.80%

Twenty-First Century Fox Inc (NASDAQ:FOX) is also favorite stock of Limestone, which upped its position in the company by over 20% during the quarter. Twenty-First Century Fox Inc (NASDAQ:FOX) did post notable financial results for the quarter ended June 30. The company’s income massively dropped to $116 million, compared to $966 million in the same quarter last year. Revenues were $6.21 billion, down from $8.42 billion in the prior year quarter. Shares of Twenty-First Century Fox Inc (NASDAQ:FOX) lost nearly 20% year-to-date. Twenty-First Century Fox Inc (NASDAQ:FOX) is also a favorite stock of Jeffrey Ubben’s Valueact Capital, owning 44.58 million shares.

Microsoft Corporation (NASDAQ:MSFT)

Shares Owned by Limestone (as of September 30): 133,859

Value of Limestone’s Shares (as of September 30): $5.93 million

Percentage of Limestone’s Public Equity Portfolio (as of September 30): 7.24%

Shares Owned by Limestone (as of June 30): 133,859

Third Quarter Returns: 0.91%

Limestone’s position in Microsoft Corporation (NASDAQ:MSFT) remained unchanged over the quarter. Microsoft Corporation (NASDAQ:MSFT)’s stock sports a dividend yield of 3.03%, allowing the stock to be ranked among the favorite dividend picks of billionaire investors. Shares of the Microsoft Corporation (NASDAQ:MSFT)’s stock inched up by 1.6% year-to-date. Another investor that sees value in Microsoft Corporation (NASDAQ:MSFT) is Jeffrey Ubben’s Valueact Capital, holding 75.27 million shares. We previously shared ValueAct’s Microsoft presentation in an article. The stock has been among the most resilient stocks during the third quarter.

Disclosure: none