Kingdon Capital Management, a New-York based hedge fund, was founded by Mark E. Kingdon in 1983. Prior to this, he worked for AT&T and Century Capital Associates. Mark Kingdon attended Columbia College and then entered Harvard Business School. The fund posted a return of 16.6% per year, from its inception until 2011.
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Based on its latest 13 F filing, Kingdon had over 119 long positions, out of which 90 stocks have a more than $1.0 billion in market capitalization, the position in which returned 12.07% in the first quarter of 2015. The fund’s equity portfolio is mainly invested in healthcare and technology sectors, which comprise 31% and 17% respectively. Mark Kingdon’s top five picks delivered an average return of 24% during the first quarter of 2015, surpassing S&P 500 ETF (SPY)’s performance of 0.9% during the same period. The top 10 positions of the fund accounted for 31.66% of the portfolio with Visteon Corp (NYSE:VC), Tyson Foods, Inc. (NYSE:TSN), and Horizon Pharma PLC (NASDAQ:HZNP) representing the top equity positions at the end of last year.
Horizon Pharma PLC (NASDAQ:HZNP), an Ireland-based specialty Biopharmaceutical company, engaged in developing products for arthritis, inflammation and orphan diseases, represents a 3.4% of stake in the fund’s portfolio. Mark Kingdon increased his exposure to the company by 183% in the fourth quarter of 2014, owning over 6.1 million shares valued at $78.3 million. The investment paid off, with the company delivering spectacular returns of 101.5% during the first quarter of 2015. Analysts remain bullish on the company supported by the firm’s recent news of acquiring Hyperion Therapeutics Inc (NASDAQ:HPTX) for $1.1 billion. Moreover, Horizon’s management expects Hyperion’s orphan disease drugs RAVICTI and BUPHENYL to add $100 million to the company’s adjusted EBITDA, including cost synergies of more than $50 million for 2016. The majority of analysts have a ‘Buy’ rating on Horizon Pharma PLC (NASDAQ:HZNP)’s stock, with JMP Securities and Piper Jaffray recently upgrading the stock price target to $31.00 with ‘Market Perform’ and ‘Overweight’ ratings respectively. Other large shareholders of Horizon Pharma PLC (NASDAQ:HZNP) are James Flynn’s Deerfield Management and Kevin Kotler’s Broadfin Capital holding 11.7 million shares and 8.9 million shares respectively.
Kingdon Capital also held 545,000 shares of Apple Inc. (NASDAQ:AAPL) worth $60.17 million. The company’s stock appreciated by 13.17% returns during the first quarter of 2015. Apple Inc. (NASDAQ:AAPL) has released for sale its Watch earlier this month and analyst’s believe that the pre-orders have already crossed the one million mark, and will boost the company’s revenues in the near future. However, the demand was so high that new orders have been pushed to July. Carl Icahn’s Icahn Capital is one of the top shareholders of Apple Inc. (NASDAQ:AAPL) with 52.76 million shares valued at $5.82 billion held as of the end of 2014.
CDK Global Inc (NASDAQ: CDK), a global provider in the technology and digital marketing, and advertising solutions for the automotive retail industry, constituted 2.5% of the fund’s portfolio. The fund owns 1.4 million shares valued at $56.97 million, as of the fourth quarter of 2014. The company went public in September 2014, after being spun-off from Automatic Data Processing (NASDAQ:ADP). CDK Global Inc (NASDAQ:CDK)’s stock rallied 52.16% since its IPO, and delivered 15% during the first quarter of 2015. The company forecasts a revenue growth of over 7%-8% in 2015, as compared to $1.97 billion revenue in 2014. Net earnings are expected to grow in the range of 6% – 8% in 2015, as compared to $1.29 per share in 2014. Jeffrey Tannenbaum’s Fir Tree has a large exposure to CDK Global Inc (NASDAQ:CDK), the position amassing 6.01% of its portfolio and containing 14.2 million shares.
The position in CBRE Group Inc (NYSE:CBG) accounts for approximately 2.5% of the fund’s portfolio. Mark Kingdon increased the fund’s exposure to the company by 66% during the fourth quarter of 2014, holding 1.7 million shares valued at $56.7 million at the end of last year. The stock of the commercial real estate company jumped by 13.02% during the first quarter of 2015, and recently announced the acquisition of Global Workplace Solutions business of Johnson Controls Inc (NYSE:JCI) for $1.48 billion in cash. ValueAct Capital has a huge stake in this $12.83 billion market cap company, holding 31.3 million shares valued at $1.07 billion. Blum Capital Partners and Ariel Investments are other shareholders of CBRE Group with multi-million dollar stakes as of the end of last year.
Mark Kingdon increased his fund’s stake in Micron Technology, Inc. (NASDAQ:MU) by 96% during the fourth quarter of 2014, holding 1.85 million shares valued at $64.88 million, which represent 2.84% of the portfolio.The stock had posted a negative returns of 22.51% during the first quarter of 2015, amid a decrease in price targets on the stock by major analysts like Nomura, Jefferies Group, and RBC Capital. Moreover, recently, Micron Technology, Inc. (NASDAQ:MU) has disclosed its financial results for the second quarter of fiscal 2015, which came in lower in year-over-year terms, but have been in line with estimates, the revenue amounting to $4.2 billion and EPS to $0.81. The company also provided its guidance for the third quarter, which was below the previous expectations of the Street. Other large shareholders of Micron Technology, Inc. (NASDAQ:MU) are David Einhorn’s Greenlight Capital with 31.3 million shares and Andreas Halvorsen’s Viking Global with 20.16 million shares.
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