Priceline, Alphabet, Hanes: Concourse Capital Was Loading Up On These 5 Stocks in Q2

Concourse Capital Management is an Atlanta-based long/short equity hedge fund founded by Joseph Mathias in 2008. Mr. Mathias holds an M.B.A. from The Wharton School at The University of Pennsylvania and prior to founding Concourse served as Vice President of Investments at Thomas E. Claugus‘ GMT Capital between 2002 and 2008. According to Concourse Capital Management’s most recent Form ADV, it had $219 million in regulatory assets under management (AUM) as of March 29.

The fund recently submitted its 13F filing with the SEC for the reporting period of June 30, revealing a U.S. equity portfolio worth $161 million. The latest filing shows that Concourse’s equity portfolio was fairly diversified, with long positions in 64 stocks, though it was also top-heavy, with its top-ten holdings amassing over half the portfolio’s value. The filing also revealed that the fund had high exposure to the consumer discretionary and information technology sectors, with stocks from those sectors accounting for 58% and 23% of the value of its equity portfolio respectively. In this article we’ll take a look at five companies whose shares the fund was loading up on during the second quarter and discuss how those stocks have performed so far in 2016.

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#5. Hanesbrands Inc. (NYSE:HBI)

 – Shares Owned by Concourse Capital Management (as of June 30): 93,127

 – Value of Holding (as of June 30): $2.34 Million

Let’s begin with Hanesbrands Inc. (NYSE:HBI), in which Concourse Capital Management initiated a stake during the second quarter. Hanesbrands’ stock has been on a gradual decline ever since undergoing a four-for-one stock split last March and is currently trading down by 14% year-to-date. Two weeks after completing its acquisition of Champions Europe on July 15, the company announced that it had completed its $800 million all-cash acquisition of Pacific Brands Limited, which is expected to deliver an after-tax internal rate of return in the mid-teens. On August 2, Hanesbrands Inc. (NYSE:HBI) reported its second quarter earnings, declaring EPS of $0.51 on revenue of $1.47 billion, close to analysts’ estimates. A day after the earnings release, analysts at Credit Suisse reiterated their ‘Buy’ rating and $37 price target on the stock. Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners sold off its stake in the company during the second quarter, which had consisted of 21,773 shares on March 31.

#4. Apollo Global Management LLC (NYSE:APO)

 – Shares Owned by Concourse Capital Management (as of June 30): 167,547

 – Value of Holding (as of June 30): $2.54 Million

Concourse Capital Management will be patting itself on the back for increasing its stake in Apollo Global Management LLC (NYSE:APO) by 29% during the second quarter, as shares of the investment management firm have appreciated by over 16.23% so far in the third quarter. Despite such a significant short-term rally, Apollo Global Management LLC (NYSE:APO)’s stock still sports an attractive annual dividend yield of 7.10%. On August 3, Reuters reported that a consortium of investors led by Apollo Global Management had emerged as the front-runner for Anglo American’s Australian met coal mines, which have been valued at around $1.5 billion. Apollo Global reported its second quarter results on the same day and managed to beat analysts’ estimates of EPS of $0.20 on revenue of $350.06 million, turning in EPS of $0.39 on revenue of $351.73 million. Jonathan Lourie and Stuart Fiertz’s Cheyne Capital also boosted its stake in Apollo Global Management during the second quarter, by 57% to 97,100 shares.

We’ll check out three more stocks that Concourse was buying during the second quarter on the next page.

#3. Constellium NV (NYSE:CSTM)

 – Shares Owned by Concourse Capital Management (as of June 30): 794,203

 – Value of Holding (as of June 30): $3.72 Million

Moving on, Concourse Capital Management made a nearly six-fold increase to its stake in Constellium NV (NYSE:CSTM) during the second quarter. The Netherlands-based aluminum products and solutions company has lost over 80% of its market capitalization since mid-2014 and over one-third of its market cap so far this year. Constellium NV (NYSE:CSTM) reported its second quarter financial figures on August 2, which included EPS of $0.09 on revenue of $1.37 billion. For the same quarter of the previous year, the company had reported a loss of $0.75 per share on revenue of $1.52 billion. The erstwhile CEO of Constellium NV, Pierre Vareille, retired last month, but the company hasn’t named anyone as his successor as of yet. On August 3, analysts at JPMorgan Chase & Co. reiterated their ‘Buy’ rating and $13 price target on the stock, which represents potential upside of 150%.

#2. Alphabet Inc (NASDAQ:GOOGL)

 – Shares Owned by Concourse Capital Management (as of June 30): 8,956 Class A

 – Value of Holding (as of June 30): $6.3 Million

Amid a 7.8% drop in Alphabet Inc (NASDAQ:GOOGL)’s stock during the second quarter, Concourse Capital Management upped its stake in the company’s Class A shares by 20%. Shares of the online search giant experienced a remarkable rally last month, first in anticipation of the company’s second quarter earnings and then following those earnings, on back of the record numbers that the company posted for the quarter. Owing to last month’s rally, the stock has recouped almost all of its losses suffered earlier in the year and is now trading very close to its lifetime high of $810.35. However, analysts believe that the stock could go much higher from here due to the company’s investments in cloud and video, and the rapid progress being made by its various moonshot projects. According to a recent report by Bloomberg, Alphabet Inc (NASDAQ:GOOGL) is planning to sell 10-year notes at a debt yield that is said to be approximately 0.68 percentage points over Treasuries in order to pay off some of its short-term debt. Billionaire Ken Fisher‘s Fisher Asset Management reduced its stake in the company during the second quarter, by 5% to 455,315 Class A shares.

#1. Priceline Group Inc (NASDAQ:PCLN)

 – Shares Owned by Concourse Capital Management (as of June 30): 5,115

 – Value of Holding (as of June 30): $6.38 Million

Concourse Capital Management increased its stake in Priceline Group Inc (NASDAQ:PCLN) by 45% during the second quarter, leading to the holding jumping nine spots to become the fund’s ninth-largest at the end of June. Priceline’s stock has been trading in a range for more than two years now and is currently up by nearly 5% in 2016. On June 30, Morgan Stanley analyst Brian Nowak released a note in which he upgraded Priceline’s stock to ‘Overweight’ from ‘Equal-Weight’ and also raised his price target on it to $1,525 from $1,320, citing the company’s “increasing profitability and the opportunity to make inroads in the alternative accommodations market.” Currently, Priceline’s stock sports an average rating of ‘Overweight’ and an average price target of $1,472 from the 29 leading analysts on Wall Street who track it. Christopher R. Hansen‘s Valiant Capital raised its stake in Priceline Group Inc (NASDAQ:PCLN) by 39% during the second quarter, to 54,542 shares.

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