Southeastern Asset Management reduced their stake in TW Telecom (TWTC) to a little over 16 million shares, giving Southeastern 10.7% of the shares outstanding. At the end of March the fund had nearly 27 million shares, so this is a substantial reduction. With TWTC up 29% year to date the fund is likely locking in recent gains on its investment or rebalancing its portfolio (check out Southeastern Asset Management’s portfolio). TWTC, which provides business ethernet and other telecom services to businesses, currently trades at a P/E of 59 and an enterprise value of nearly 10 times trailing EBITDA with no dividend, so it is far from a value investment. Its growth, however, has been very steady with Q1 of 2012 being the 30th consecutive quarter of revenue growth. Jim Simons’s Renaissance Technologies was another major hedge fund holder of the stock at the end of March, with 1.4 million shares.
Third Avenue Management engaged in three significant sales of stock. First, they reduced their stake in Investment Technology Group (ITG) to about 1.3 million shares or about 3.5% of the shares outstanding. Their position in PH Glatfelter (GLT) was decreased to about 1.6 million shares, about 3.7% of the company. Finally, Third Avenue now owns about 4.8% of Electronics for Imaging (EFII) as a result of bringing the number of shares in its portfolio down to about 2.2 million. Third Avenue had owned 3.3 million, 2.5 million, and 2.4 million shares respectively of these companies on March 31 (see Third Avenue’s other holdings). Of these, the largest sale was of ITG which was reduced by 31% since that time.
Steve Cohen’s SAC Capital Advisors (see more of Steve Cohen’s stock picks) invested additional capital in Wellcare Health Plans (WCG) and now owns approximately 2.2 million shares of the company, which comes out to 5% of the shares outstanding. This is roughly double the 1.1 million shares it owned at the end of March. Wellcare is a provider of public health insurance programs such as Medicare and Medicaid and receives its revenue from federal and state government agencies in relation to the number of members in its network. Renaissance Technologies is also a top hedge fund holder of WCG, with 1.1 million shares. The stock trades very cheaply with a trailing P/E of less than 10 and a trailing EBITDA multiple of 2.5, even after rising 22% so far in 2012. The company has nearly $39 of cash on its balance sheet per share, which places it in a good liquidity position but means it is not investing much in bringing in future earnings.
Luxor Capital owned 6.8 million shares of Nordion (NDZ). This is down from 10.1 million at the end of March, but the fund still owned about 11% of the shares outstanding (here are other recent Luxor holdings).
Finally, Artis Capital Management decreased its position in PLX Technology (PLXT) to about 650,000 shares. Artis had owned 3.9 million shares at the end of March and was likely selling out of its position after good earnings pushed the stock up 58% in the second quarter.
