Over the past few weeks, most hedge funds in the U.S. have been filing their Form 13Fs with the Securities and Exchange Commission, disclosing their long equity positions as of March 31. In this article, I will take a look at David Tepper’s Appaloosa Management Lp and Larry Robbins’ Glenview Capital’s most relevant bullish moves that took place in Q1. But, why these funds?
According to an Insider Monkey article published a couple of months ago, Mr. Tepper and Mr. Robbins are among the three best hedge fund managers of 2013, along with Michael Castor of Sio Capital. As this last fund doesn’t file 13Fs, because it had an equity portfolio smaller than $100 million by the end of 2013, which makes it exempted from disclosing its equity portfolio, we will only look into Appaloosa’s and Glenview’s holdings from the latest 13F. However, we should highlight that Sio Capital returned an impressive 23% during the first four months of the year, widely outperforming the S&P 500, which was barely up during the same period.
First off is Citigroup Inc (NYSE:C), a famed $142 billion market cap financial services holding company. During the first quarter, both Appaloosa Management and Glenview Capital increased their stakes in this firm. The latter upped its bets by 64%, to 5.18 million shares, worth more than $240 million, while the former inched up its position by 4%, to 10.08 million shares, valued at more than $470 million. Another hedge fund placing big bets on Citigroup is Boykin Curry’s Eagle Capital Management, which started a position in the company, with 15.23 million shares held as of the end of the first quarter. Ken Griffin‘s Citadel Investment Group is another shareholder with a significant position which amasses around 9.92 million shares.
Second in this list is HCA Holdings Inc (NYSE:HCA), a $22.9 billion market cap health care services company. This is Glenview Capital’s third most valuable holding, worth more than $660 million. Its position remained unchanged over the first quarter (12.84 million shares), and so is the largest hedge fund shareholder of the company.
Appaloosa Management’s owns 5.3 million shares of the healthcare company, adding around 225,500 shares during the first three months. Other major funds that own shares of the company are Lee Ainslie’s Maverick Capital, William B. Gray’s Orbis Investment Management, and Keith Meister’s Corvex Capital, which own more than 4 million shares each.
Finally, there’s two more cases that we would like to look into. The first one is that of American International Group Inc (NYSE:AIG), an insurance behemoth with more than $76 billion in market cap. While Glenview increased its participation by 14%, to 9.85 million shares (worth about $520 million), Appaloosa halved its exposure to the stock, and now holds 1.22 million shares (valued at about $61.26 million).
Another case, which is very similar to the previous one, is that of General Motors Company (NYSE:GM), a $55 billion market cap automaker that saw Appaloosa increase its stakes by 2.92 million shares, to 7.88 million shares (worth about $270 million). On the opposite, Mr. Robbins’ fund shrank its investment in the company by 22% and now owns 4.94 million shares, worth $170 million. Warren Buffett‘s Berkshire Hathaway also cut its stake by 10.00 million shares, owning 30.00 million shares, valued at $1.03 billion as of the end of March.
Although the aforementioned cases are not clear examples of bullishness, the bets that both funds hold on these stocks are not to be overlooked. All of the companies in this list offer very decent (usually above-average) growth projections for the next five years to come, and certainly deserve a closer look in order to elucidate if they stand as attractive investment options.
Disclosure: Javier Hasse holds no position in any stocks mentioned.
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