Whitebox Advisors’ Top Long Positions Heading Into Q2

#3 Two Harbors Investment Corp (NYSE:TWO)

 – Shares held by Whitebox Advisors (as of March 31): 9.06 million

 – Value of Holding (as of March 31): $71.97 million

Whitebox Advisors  initiated a stake in Two Harbors Investment Corp (NYSE:TWO) during the third quarter of 2015 and increased it by 467% and 187% respectively during the next two quarters. While shares of the real estate investment trust (REIT) have been on a gradual decline for the most part since the fund bought into the stock, shares have rebounded somewhat since their 52-week low point in mid-February and are currently trading down by 5.33% year-to-date. The decline that the stock has went through has increased its annual dividend yield to almost 12%, which is among the highest current yields in the REIT space. According to analysts, Two Harbors Investment Corp (NYSE:TWO)’s stock, trading at a 23.4% discount to its book value of $10.11, is extremely cheap right now given the quality of assets that the REIT owns. Michael Platt and William Reeves’ BlueCrest Capital Mgmt. initiated a stake in Two Harbors Investment Corp (NYSE:TWO) during the first quarter, purchasing 41,926 shares of the company.

#2 Yahoo! Inc. (NASDAQ:YHOO)

 – Shares held by Whitebox Advisors (as of March 31): 2.10 million

 – Value of Holding (as of March 31): $77.5 million

Amid a 10% rise in Yahoo! Inc. (NASDAQ:YHOO)’s stock during the first quarter, Whitebox Advisors reduced its stake in the company by 18%. Like American Capital Ltd., Yahoo! Inc. (NASDAQ:YHOO) also decided to sell its core business earlier this year after being pressurized by activist investors, namely Jeffrey Smith‘s Starboard Value. According to recent reports, the company has received more than ten first-round offers for its core business, valuing it in the $4 billion-to-$8 billion range. On April 27, Starboard Value dropped its proxy fight against the company after Yahoo agreed to add four new independent directors to its board, including Mr. Smith. Speaking to CNBC on May 2, investing legend Warren Buffett said that Yahoo’s business has “deteriorated significantly” and that “something has to change” in the company’s operations for it to return to growth. Stephen J. Errico‘s Locust Wood Capital Advisers doubled its stake in Yahoo to 627,920 shares during the January-to-March period.

#1 Par Pacific Holdings, Inc. (NYSEMKT:PARR)

 – Shares held by Whitebox Advisors (as of March 31): 7.84 million

 – Value of Holding (as of March 31): $147.2 million

Despite Whitebox Advisors reducing its stake in the company by 5% during the first quarter and the company’s stock plummeting by 20% during that period, Par Pacific Holdings, Inc. (NYSEMKT:PARR) [formerly Par Petroleum Corporation] remained the fund’s top stock pick at the end of the first quarter. Much of the loss suffered by the stock during the first quarter came after the company reported its fourth quarter earnings on February 29. While analysts had expected the company to report EPS of $0.23 on revenue of $413.35 million for the quarter, Par Pacific Holdings, Inc. (NYSEMKT:PARR) declared a loss of $0.99 per share on revenue of $443.26 million. Following the earnings release, analysts at Imperial Capital reiterated their ‘Outperform’ rating on the stock but lowered their price target on it to $25 from $30. The company is expected to report its first quarter results early next week and the consensus among analysts is for it to report EPS of $0.18 on revenue of $413.35 million. For the same quarter of the previous year it pulled in EPS of $0.01 on revenue of $543.61 million.

Disclosure: None