Jason Karp‘s Tourbillon Capital Partners is betting big on Texas-based retailers CONN’S, Inc. (NASDAQ:CONN) and Men’s Wearhouse Inc (NYSE:MW). In a 13G filing submitted with the SEC on September 11, the fund revealed that it has increased its stake in CONN’S, Inc. (NASDAQ:CONN) to almost 3.25 million shares, or 8.9% of th outstanding shares of the company, more than double the 1.5 million shares that it held at the end of June. In a separate filing submitted on the same day, Tourbillon Capital disclosed that it now owns slightly above 2.9 million shares or 2.9% of the common stock of Men’s Wearhouse Inc (NYSE:MW).
Tourbillon Capital Partners, a New York-based long/short equity hedge fund, was founded by Jason Karp in 2013. Mr. Karp holds a B.S. in Economics from the Wharton School of the University of Pennsylvania. Prior to founding Tourbillon, Mr. Karp worked at legendary trader Steve Cohen’s now-defunct hedge fund SAC Capital between 2005 and 2009. Starting with $250 million in assets under management (AUM) in 2013, Tourbillon Capital now boasts a U.S public equity portfolio worth $4.6 billion. As of June 30, the top ten holdings of the firm accounted for 41.73% of its equity portfolio and 38% of the fund’s portfolio was invested in stocks from the consumer discretionary sector.
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CONN’S, Inc. (NASDAQ:CONN) has been one of the best performing retail sector stocks this year. Even though it has slipped by more than 35% from the high it hit in July, it still trades up over 50% year-to-date. On September 9, shares of the company opened the session up by more than 13% following the release of its second quarter earnings results, but gave up all of those gains during the trading session and have now receded by over 8% over the last three trading days. The company reported EPS of $0.47 for the quarter on revenue of $396.10 million, compared to analysts’ estimates of EPS of $0.47 on revenue of $396.38 million. On September 10, following the earnings release, analysts at Piper Jaffray reiterated their ‘Buy’ rating on the stock, however, they lowered their price target on it to $37 from $45. CONN’S reported the completion of its previously announced securitization of $1.12 billion of receivables from its credit segment on September 11. Several investors who previously pushed for the separation of the company’s retail segment from its credit segment see it as a promising move. Robert Pohly‘s Samlyn Capital was one of the hedge funds that initiated a stake in CONN’S during the second quarter and held over 1.45 million shares of the company on June 30.
