Summary of Hedge Fund Holdings from 13F Filings as of June 31st
ADAGE CAPITAL· Top new buys: NVT, PEG, VST, MAS, D, F, OGE, FCX, TRU, BV
· Top exits: NKTR, RTN, CQH, VVC, ETR, AGR, NDSN, PX, AEP, WCN
· Boosted stakes in SHPG, AET, MRK, AMZN, LMT, WFC, SRPT, HON, MMM
· Cut stakes in CC, DE, WRK, EMR, ITW, CI, PNC, BAC, DLTR, FTV
ANCORA ADVISORS· Top new buys: AVGO, MIK, CLBK, HSIC, TRNC
· Top exits: PRF, AFSI, ALLE, SKYW, RCII
· Boosted stakes in LBRDK, PAH, MATW, HILI, GHL
· Cut stakes in GLIBA, ARCH, HDV, GLW, IWM
APPALOOSA MANAGEMENT· Top new buys: KEY, SYMC, CFG, VST, EDU, NXPI
· Top exits: QQQ, AMAT, SMH, ALL, NVDA, HCA, BTU, URI
· Boosted stakes in MU, WDC, LNG, WFC, PAH, PCG, KNX, KMT, SUM
· Cut stakes in BABA, NRG, BAC, MGM, ALLY, AGN, XPO, GOOG, AMLP
BALYASNY ASSET MANAGEMENT· Top new buys: T, BBY, WMT, ERJ, LNC
· Top exits: BURL, AIG, VIPS, URI, HTZ
· Boosted stakes in WFC, STI, DLTR, EVRG, DWDP
· Cut stakes in DIS, AA, NTRS, V, DRI
BAUPOST GROUP· Top new buys: TRCO, SBGI, TBIO, SHPG
· Top exits: PBF, IMOS, FWP, OREXQ
· Boosted stakes in FOXA, FOX, PCG, ABC, AGN, TMQ, VSAT, MCK
· Cut stakes in LN
BERKSHIRE HATHAWAY· Top exits: VRSK
· Boosted stakes in AAPL, USB, TEVA, BK, DAL, GM, GS, LUV, AXTA
· Cut stakes in AAL, PSX, CHTR, UAL, WFC
BLUE HARBOUR GROUP· Top new buys: GWR
· Top exits: FTNT, JACK, RDC, MDRX
· Boosted stakes in WCC, IWM, FCE/A, AXTA, SPY, OTEX, COMM
· Cut stakes in XLNX, MD, ON, ISBC
BRIDGEWATER ASSOCIATES· Top new buys: CMI, AMAT, BABA, BMY, WMT, JNJ, LMT, AKAM, PHM, INTC
· Top exits: PG, GE, DVA, RIG, PEP, CPB, AMGN, FCX, DRI, MAS
· Boosted stakes in TD, RY, IEMG, TOL, CVX, MCD, SU, TEL, BNS, CAT
· Cut stakes in VWO, EEM, SPY, NFX, FB, SWN, CLF, BBBY, ABC, BIIB
CITADEL ADVISORS· Top new buys: KDP, EQH, EVRG, BNS, BJ SBUX
· Top exits: AMD, USG, BABA
· Boosted stakes in C, AMAT, AMZN, V, KEY, DVN, MU
· Cut stakes in AVGO, ADI, LRCX, UTX, CSCO, ABT
CLINTON GROUP INC· Top new buys: EL, CAT, LMT, MCK, VZ, CCE, FITB, LOPE, AGNC, ABX
· Top exits: MON, DRI, MA, LLY, JNPR, BCO, PEP, TWTR, HDS, CDNS
· Boosted stakes in PGR, HRB, COLM, WLK, DNB, ITW, CMD, ROK, MO, SNPS
· Cut stakes in FB, D, GOOGL, ABBV, AVY, REG, WCG, AMGN, EA, HSY
COATUE MANAGEMENT· Top new buys: SPOT, INTC, NOW, AAXN, HTZ, HUYA
· Top exits: SNAP, RHT, WDC, CGNX, LRCX
· Boosted stakes in FB, MSFT, ADBE, ATVI, PYPL, TAL
· Cuts stakes in MU, AAPL, AVGO, BABA, FWONK
CORVEX MANAGEMENT· Top new buys: MGM, VNO, MDB, MHK, CHTR, LCA, FOXA, CTL
· Top exits: BABA, EVHC, KDP, IQ
· Boosted stakes in TMUS, NXPI, JBLU, BAC, MSFT
· Cut stakes in EGN, CRM, GOOGL, MDCO, FG, NOW, ICE, FB
DUQUESNE FAMILY OFFICE· Top new buys: FB, GILD, OIH, MPC, SPLK, ADSK, DVN, ATVI, XLE, HD
· Top exits: INTC, NKTR, MU, JD, QCOM, YNDX, VIPS, STL
· Boosted stakes in MSFT, BABA, WDAY, CTRP, PAGS
· Cut stakes in GOOGL, STMP, AMZN
ELLIOTT MANAGEMENT· Top new buys: DVN, VMW, FOX, SRE
· Top exits: EGN, TER, NOMD, VICI
· Boosted stakes in HES, DISH, EQT, MFGP, QQQ, ATHN, WIN, NXPI
· Cut stakes in CDK, ISBC, WIT, IMPV
EMINENCE CAPITAL· Top new buys: BERY, SYMC, QSR, HLT, HAIN, MHK, BECN, CPLG, CTRP, EQIX
· Top exits: PZZA, NEWR, JACK
· Boosted stakes in ELLI, TTWO, VMC, LEN, CF, EFX, EA, GOOG
· Cut stakes in WEN, ICE, MSFT, CBRE, ADSK, PYPL, IQV, FB, CYBR
ENGAGED CAPITAL· Top new buys: UEIC, CASY, GRPN
· Top exits: FNSR, MX, IWM
· Boosted stakes in APOG, STKL, BHE, BW, NCR, PETX
· Cut stakes in CCRN
FAIRHOLME CAPITAL· Top new buys: C
· Top exits: SRG
· Boosted stakes in T, VSTO, OAK
· Cut stakes in JOE, SHLD, VST
GLENVIEW CAPITAL· Top new buys: NVT, MSFT, FBHS, HOLX
· Top exits: TMUS, CAH, RLGY, CMCSA, V, HUM, FB
· Boosted stakes in ESRX, FDC, CHTR, AET, ENDP, AGN, ARMK, MTOR, MCK, CNDT
· Cut stakes in HCA, LH, ANTM, CAR, IQV, UHS, NWL, CVS, WBA, APTV
GOLDEN GATE CAPITAL· New buy: GWR
· Exits: KLXI
· Boosted stakes in ARCC, HXL, ADS, WCC, ALB
· Cut stakes in NGVT, TNET
GREENLIGHT CAPITAL· Top new buys: GPS, DG, TJX, AZO, DLTR, BBY
· Top exits: CEIX, DDS, TPR, BLMN, FIVE, ANF, PYPL, URBN, SFM, ODP
· Boosted stakes in IAC, BHF
· Cut stakes in MU, AER, AAPL, MYL, VOYA, PRGO, CNDT, ADNT, CNX, DSW
· NOTE: Greenlight Used Recent Athenahealth Spike to Re- Short Shares
HIGHFIELDS CAPITAL MANAGEMENT· Top new buys: NXPI, CVS, FB, LEN, PBR/A, SNE, ESRX, ACWI, MHK
· Top exits: EXPE, HDS, DLTR, IVZ, ENB, HAL, X, PE, MDLZ, TGT
· Boosted stakes in CHTR, AET, GOOGL, DIS, GOOG, EQT, RJF, MIK
· Cut stakes in HCA, FOXA, FDX, CMCSA, PXD, HLT, VER, H, VOD, CCE
ICAHN ASSOCIATES· Top new buys: EGN, VMW, AFSI, CI
· Boosted stakes in IEP, NWL
· Cut stakes in HLF, LNG
JANA PARTNERS· Top new buys: FB, BABA, MSFT, WFC, DXC, GOOGL, RPM, GRUB, ATUS
· Top exits: BLMN, NOC, KDP, WRK, CI, DISCK, IQ, ILG, ILPT, DBX
· Boosted stakes in PF, SPY, EA, CAG, A, AAPL
· Cut stakes in TIF, LRCX, HDS, ADSK, BSX, GM, ZBH, FDC, JACK, ANTM
LAKEWOOD CAPITAL· Top new buys: ESRX, ASND, FB
· Top exits: CJ, ABG,
· Boosted stakes in C, BIDY, WRK, CMCSA
· Cut stakes in CIT, ADNT, RLGY
LAND & BUILDINGS INVESTMENT MANAGEMENT· New buy: DHI
· Top exits: RLJ, MAR, RESI, VTI, HST
· Boosted stakes in CLI, BKD, LEN, INVH, PLD
· Cut stakes in LSI, MAC, QTS
· NOTE: Activist Litt Is Said to Consider Pushing for Sale of Mack-Cali
LONE PINE CAPITAL· Top new buys: CP, NVDA, MHK
· Top exits: AVGO, TSM, BLK, TMUS, EXAS
· Boosted stakes in WYNN, TDG, MSFT, BABA, NOW, MELI, GOOG, IQV, BKNG, PAGS
· Cut stakes in FB, PYPL, STZ, ADBE, AMZN, FLT, EA, TRU, CSX, UNH
MARCATO CAPITAL· Top new buys: IMAX, CPLG
· Boosted stakes in TEX, THRM
· Cut stakes in IAC, ITRI, DXC, BLDR, AIR, TPHS, VRTS
MAVERICK CAPITAL· Top new buys: DIS, AAOI, GPK, SPOT, ALNY, PRSP, COMM, CASY, GPS, TGT
· Top exits: TAP, SNAP, MGM, PM, LVS, CAR, WING, DPZ, ETSY, EAT
· Boosted stakes in DLTR, MA, CNC, TMUS, MHK, CIEN, BUD, MSFT, KORS, SCHW
· Cut stakes in V, UHS, EVHC, DWDP, AMRX, ADBE, WTW, VFC, TIF, TPR
MARSHALL WACE· Top new buys: TMUS, AXGN, TSM, BRX, IDXX, GPS, CMG, ACGL, JEC, MTN
· Top exits: SCI, NTRS, CME, NKE, MU, SRCL, JPM, IBN, FLT, AXP
· Boosted stakes in TFX, ATVI, BBY, DGX, SPGI, MCD, BURL, ROST, ZTS, VRTX
· Cut stakes in BABA, BAC, DISCK, AVGO, UNH, SAGE, GS, AJG, GILD
MOORE CAPITAL· Top new buys: NXPI, GOOGL, WFC, MA, SPOT, TGT, FDC, AMP, KMX
· Top exits: MS, AAPL, GS, LMT, NOC, RTN, GD, COF, BPOP, PLNT
· Boosted stakes in GCP, FB, EQT, PX, FBP, MOMO, NVDA, CME, GM, TMUS
· Cut stakes in BABA, BAC, MSFT, AVGO, CCI, ISBC, V, TWTR, EA, VOYA
OMEGA ADVISORS· Top new buys: NRG, IQV, LEN, MPC, CVS, KKR, MGY, WRD, CDAY, IMMU
· Top exits: BMY, WFC, NAVI, NFLX, NYCB, GWPH, GLPI, D, BKI, NINE
· Boosted stakes in SBGI, ASH, HUM, TRN, C, FTSI, MU, TMO, PE, FRAC
· Cut stakes in SHPG, ANDV, MXL, PVH, DXC, DISH, AER, VVV, PFSI, ALLY
PAULSON & CO· Top new buys: MITL, AKRX, CMCSA, ATUS, FOXA, LHO
· Top exits: MDR
· Boosted stakes in DISCK, NXPI, FOX, AET, XL, TMUS
· Cut stakes in GOLD, IAG, COL, AEM, GG, SHPG
PERSHING SQUARE· Top new buys: LOW
· Boosted stakes in UTX, MDLZ
· Cut stakes in ADP, QSR
POINT72 ASSET MANAGEMENT· Top new buys: MPC, FOXA, TEVA, SGEN, WMGI, PNC, SGMS, AZO, LOXO, HUM
· Top exits: ANDV, NFLX, HON, LOW, MCD, AIG, NVDA, BYD, ETN, CAH
· Boosted stakes in GOOGL, HLT, BMY, PE, BIDU, SYK, DVN, CMCSA, DXC
· Cut stakes in WYNN, AVGO, STZ, OXY, ATVI, FB, BKNG, DWDP, BABA, LRCX
POINTSTATE CAPITAL· Top new buys: MPC, FB, CVX, TEVA, PXD, NXPI, STM, USFD, NOW, APC
· Top exits: BAC, CFG, AVGO, DE, RF, FCAU, MYL, GS, NOC, GILD
· Boosted stakes in TRGP, AET, FE, NFLX, SHPG, MSFT, BABA, ADBE, VRTX, JD
· Cut stakes in CRM, LRCX, LNG, LOW, DWDP, LOMA, BMA, LLL, LYB, X
RENAISSANCE TECHNOLOGIES· Top new buys: AAPL, FB, MSFT, MS, AXP, ITW, CME, WY, FL, AMG
· Top exits: BKNG, VZ, MON, PG, WFC, SLB, TWX, KO, CVS, BDX
· Boosted stakes in VMW, ABMD, JNJ, WMT, VRTX, HLF, ABEV, WWE, GS, CTXS
· Cut stakes in HD, AMZN, BMY, LLY, PEP, UNH, NXPI, PM, CL, GILD
SANDELL ASSET MANAGEMENT· Top new buys: KLXI, PAY, ANDV, GPT, EVHC, ILG, EDR, PF, COTV
· Top exits: STB, BABA, AKRX, BKS
· Boosted stakes in COL, NXPI, AVA, ORBK, XL, FB, AMZN, AAPL, MSFT, GOOG
· Cut stakes in OCLR, MGI, KS
SENATOR INVESTMENT· Top new buys: MRK, FOXA, HD, BKI, LNG
· Top exits: AVGO, ARNC, LOW, BUD, CMCSA
· Boosted stakes in CZR, ICE, APTV, FDC, BA
· Cut stakes in DWDP, DHI, JAZZ, FG, XPO
SOROBAN CAPITAL· Top new buys: GOOGL, UTX, GRA, MHK
· Top exits: BUD, CMCSA, LBRDK, FB, CHTR
· Boosted stakes in SAP, NSC, AXTA
· Cuts stake in NXPI, UNP, MGM, AVGO, FWONK, GOOG
SOROS FUND MANAGEMENT· Top new buys: SPOT, P, COUP, FB, DVN, EXR, HUBS, HLT
· Top exits: KW, LRCX, AMLP, ZAYO, BAX, TMO, LH, TGT, CI, KRE
· Boosted stakes in NXPI, XL, I, LPLA, NOW, CRM, TTWO, LULU, CVE, ETFC
STARBOARD VALUE· Top new buys: WEB, RPM, SCOR
· Top exits: EVHC, BCO
· Boosted stakes in BMS, IWN, PRGO
· Cut stakes in NWL, MAC, CARS, BAX, DEPO
TEMASEK HOLDINGS· Top new buys: ASLN
· Top exits: KRE, JPM, BAC, WFC, MS, GS, SENS, RDUS
· Boosted stakes in CTL, HDB, PYPL, V, GPN, MA, PTLA, DWDP, WP, AVGO
· Cut stakes in VIRT, AMRS, NETS, AMZN, BABA
TIGER GLOBAL· Top new buys: UXIN, COUP, ADBE, GDS, HUYA, PVTL, DOCU, NEW, CDAY
· Top exits: EHIC, SINA, ARCC, UAL
· Boosted stakes in TWTR, FB, NOW, MELI, RUN, BABA, SE, APO, CRM, ADSK
· Cut stakes in RDFN, JD, TDG, MSFT
THIRD POINT· Top new buys: NXPI, PYPL, V, CPB, DE, FPAC, EGN, PVH, CWH
· Top exits: GOOGL, ICE, MHK, PAGS, ANTM, GGAL, GRBK, PAM, BKI, SUPV
· Boosted stakes in MSFT, ADBE, EA, MPC, UTX, DWDP, CRM, SHY, DOV
· Cut stakes in BLK, WP, STZ, FB, LEN, WYNN, SPGI, SHW, VMC
· NOTE: Third Point Discloses New Stake in PayPal: 2Q Letter
TRIAN· Top new buys: NVT
· Boosted stakes in BK, GE, MDLZ
· Cut stakes in PNR, WEN, SYY
· Activist investor Trian takes new stake in undisclosed company
TUDOR INVESTMENT· Top new buys: AVHI, HD, CHFN, SHPG, VZ, FFKT, LHO, FBNK, NKE, ANDV
· Top exits: SPB, SBUX, DLTR, DECK, DXC, MSI, PEP, AIG, SPGI, IR
· Boosted stakes in PF, FOXA, TGT, TJX, BIDU, COL, AAPL, AET, JPM, CMCSA
· Cut stakes in SPY, NXPI, AMZN, C, WBA, MU, PAGS, BKNG, PDCO
VALUEACT· Top new buys: UFI, LIND, STRA, AES, EVA
· Boosted stakes in C, SLM, ADS, BHC, STX, AFI, MS
· Cut stakes in FOX
VIKING GLOBAL· Top new buys: GE, DWDP, MIDD, TMUS, ILMN, HBI, OLN, PTEN, CNC
· Top exits: WFC, ADS, TDG, WDC, VOYA, XEC, CVS, MOMO, NTES, CLR
· Boosted stakes in UTX, DIS, TMO, PE, AMZN, HIG, BMRN, MSFT, LNC, ANTM
· Cut stakes in XRAY, GOOGL, TD, FB, CP, NFLX, EFX, V, BUD, ADSK
YORK CAPITAL· Top new buys: NVT, CNC, USG, PRSP, T, ATUS
· Top exits: GRA, SHPG, EVHC, WHR
· Boosted stakes in NXPI, XL, FMC, ESRX
· Cut stakes in TRCO, AABA, AVGO
Forget About Turkey: Asia Is The Elephant In The Room
Back in November 2016, the BIS picked up on a topic we have often discussed over the years, namely the critical role that dollar abundance (or shortage) plays in defining market stress, and going one step further, published a research report which made the striking claim that while the VIX was now dead as an indicator of market risk, it had been replaced with the value of the dollar. This is what the Bank of International Settlement said then:
Just as the VIX index was a good summary measure of the price of balance sheet before the crisis, so the dollar has become a good measure of the price of balance sheet after the crisis. The mantle of the barometer of risk appetite and leverage has slipped from the VIX, and has passed to the dollar.What explains the dollar’s role as the summary measure of the appetite for leverage? In a nutshell... there is a tight “triangular” relationship between (1) the dollar, (2) cross-border bank capital flows in dollars and (3) the deviation from CIP. The key to understanding this relationship is that dollar cross-border capital flows closely track the leverage decisions of global banks. The triangular relationship says volumes about the role of the US dollar in the global banking system, and ultimately how the monetary policy backdrop determines global financial conditions.
Fast forward to this June, when the head of the Reserve Bank of India, Urjit Patel, made a solemn appeal to the Fed: stop shrinking your balance sheet because in combination with the soaring US budget deficit (which requires a surge in new Treasury issuance), you are draining precious USD-liquidity out of the market.
This was the first time this cycle that a prominent foreign central banker accused the Fed of stirring trouble for emerging markets, with its ongoing tightening:
Global spillovers did not manifest themselves until October of last year. But they have been playing out vividly since the Fed started shrinking its balance sheet. This is because the Fed has not adjusted to, or even explicitly recognised, the previously unexpected rise in US government debt issuance. It must now do so.
Patel's advice? Immediately taper the tapering, or rather, the Fed should "recalibrate its normalisation plan, adjusting for the impact of the deficit. A rough rule of thumb would be to reduce the pace of its balance-sheet contraction by enough to damp significantly, if not fully offset, the shortage of dollar liquidity caused by higher US government borrowing."
Incidentally, the various pathways described by Patel were conveniently laid out by Deutsche Bank's Aleksandar Kocic earlierthis year, and which we explained in "Why The Soaring Dollar Will Lead To An "Explosive" Market Repricing."
Patel's punchline: if left unchecked, the EM turmoil "might hurt the US economy as well. Circumstances have changed. So should Fed policy. It would still reach the same destination, but with less turmoil along the way."
Two months later, the turmoil among emerging markets raging, with the currencies of Turkey, Argentina, Brazil, Russia and even China sliding against the dollar. So far the only part of his prediction that has not manifested, is the contagion from EMs to the US economy.
But that may be only a matter of time, especially if the Turkish crisis spills over into the European banking sector, and from there it crosses the Atlantic.
Meanwhile, focusing on the gloomy reality facing Emerging Markets - and their addition to dollars - is the latest note out of Nedbank's Neels Heyneke and Mehul Daya, who warn about the troubling fate facing EMs, writing that excess liquidity usually leads to the misallocation of capital, masking any balance sheet constrains. And as this tide of excess liquidity recedes it reveals the misallocation of capital and the mispricing of risk. The two caution that as EMs have benefited the most from this misallocation of credit, yet as the tide of excess liquidity recedes, "EMs will begin to pay the heavy price of this misallocation of credit." The "spread" between capital misallocation and reality is shown in the chart below.
Where we go full circle with the warnings from both the BIS and Urjit Patel, is that one way to monitor the ebb and flow of excess liquidity is by looking the changes in the value of the USD. As long as the dollar remains the reserve currency and most of the foreign owned debt is denominated in US dollars, for example in the carry trade, the dollar will remain king. Stated simply, "a weaker USD is associated with a stable and healthy global environment whereby the global supply of USD’s is abundant. A stronger USD is usually associated with volatility and a risk-off phase as liquidity contracts" which is basically the point made by the BIS nearly 2 years ago.
As a result of Quantitative Tightening and rising interest rates, since the start of the year the supply of USDs has become scarce amid escalating tit-for-tat trade policies, slowing credit growth in China, and weaker commodity prices. This can be seen clearly in Nedbank's Global Broad $-Liquidity indicator, shown below.
Going back to Emerging Markets, while until recently investors were eager to attribute sharp drops in various EM nations to idiosyncratic factors, the recent widespread turmoil has become increasingly systemic. Confirming this, Nedbank notes that a number of studies have emerged pointing out that the role of global factors has increased relative to country/corporate specific factors.
This indicates that investors need to place more emphasis on the role of global liquidity (the changing pool of money and credit).
And while investor attention has been captivated by Turkey in recent weeks, Nedbank has some words of advice: "Forget about Turkey’s woes, Asia is the elephant in the room."
The reason is that South East Asia again stands out as in 1997/8, with a large amount of USD denominated debt outstanding. The only difference is then Asia had fixed exchange rates and now they are floating! Furthermore, Asia’s USD debt, relative to international FX reserves and exports, has risen significantly since 2009. This leaves these nations susceptible to a shortage in USDs (which would manifest itself in a sharply higher dollar price). Meanwhile, the Asian nations that have amassed record amounts of USD debt are also home to the largest technology companies i.e. Tencent (China), Alibab (China), TSNC (Taiwan), Samsung (S.Korea). The tech sector is now 28% of the MSCI EM index.
So between the rally in the US Dollar, dented global growth prospects, slowing Chinese credit growth and escalating political tensions from the US, leaves these nations very exposed to a shortage in USDs. Which is why, in Nedbank's view, "we believe Asia will be the next source of downside systemic risk for financial markets."
To be sure, one look at the chart below demonstrates that changing financial conditions have been the major driver of EM asset prices over the last several years. The risk-on phase ended in January and all EM assetss old-off. EM-FX are however now taking the lead and the next few days will indicate whether this will spillover into the other asset classes.
So putting all of the above together, how to determine what happens next? Simple: keep an eye on the dollar... and stick the following EM contagion transmission chart on your wall:
If the dollar keeps rising aggressively at a time when China (which for now has a nice, thick capital controls firewall) is devaluing while other EMs are scrambling to contain capital flight by aggressively hiking rates (such as Argentina's shocking 45% rate hike yesterday) in the process sending their economies into recession, should the Fed fail to contain the dollar surge, the outcome may well be another Plaza Accord. But not before global markets crash first.
Early premarket gappersGapping up:
- CGC +27.7%, PETQ +15.2%, CDLX +9.1%, PRSP +8.5%, SORL +8%, MRT +7.5%, EGN +6.6%, EC +4.9%, ADNT +4.7%, ERI +4.2%, TELL +3.4%, WPM +2.3%, AERI +1.7%, DAL +1.4%, VNDA +0.9%, GS +0.7%, LUV +0.7%
Gapping down:
- CASA -29.1%, VRAY -6.3%, SBBP -5.6%, CRZO -5.4%, ENPH -5.1%, FANG -4.9%, IIN -4.2%, HOLI -3.6%, A -2.3%, VIAV -2.3%, DVN -2.2%, CREE -2.2%, SHLD -1.6%, KANG -1.6%, WTW -1.1%, GDDY -1.1%, UNP -0.9%, SYMC -0.9%
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Buffett’s Berkshire Keeps Buying More of Apple
Billionaire investor says tech company makes a consumer product he understands, the iPhone
Warren Buffett’s Berkshire Hathaway Inc. BRK.B 0.32% continued to load up on technology giant Apple Inc. AAPL 0.42% in the second quarter.
Berkshire increased its holdings of Apple stock by 12.4 million shares in the quarter, taking its stake to $46.6 billion by the end of June, according to a new securities filing on Tuesday.
Mr. Buffett’s firm has largely avoided investing in the tech sector, even during a run-up in technology shares in recent years. One of the few exceptions has been Apple, which Mr. Buffett has said makes a consumer product he understands.
Berkshire has repeatedly added shares of the iPhone maker, including more than doubling its stake in early 2017. As of March 31, Berkshire was Apple’s second-largest shareholder after Vanguard Group, holding 4.96% of Apple stock.
In the second quarter, Berkshire also sold some shares in Wells Fargo & Co. while adding to its shares of Goldman Sachs Group Inc.
Berkshire prefers to keep most of its holdings under 10% to avoid increased regulatory requirements. This self-imposed limit caused it to adjust its holdings in the banking and airlines industries, the company said.
Berkshire sold 4.5 million shares of Wells Fargo in the second quarter and bought 2.3 million shares of Goldman Sachs. The firm also bought 9.9 million shares of U.S. Bancorp .
The firm adjusted its airline holdings in the quarter. It sharply increased its stakes in Delta Air Lines Inc. and Southwest Airlines Co. , while reducing its ownership in American Airlines Group Inc. and United Continental Holdings .
Mr. Buffett famously derided investing in airline stocks after suffering initial losses from a foray into the former USAir Group Inc. Berkshire bought $358 million of preferred stock in USAir in 1989, but the investment lost value in subsequent years.
“I plunged into the business at almost the exact moment that it ran into severe problems,” Mr. Buffett wrote in his 1990 letter to shareholders.
Berkshire sold its stake “for a hefty gain” in 1998, Mr. Buffett wrote in his 2007 letter, but he said he still regretted the purchase.
“The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money. Think airlines,” he wrote.
Still, the airline industry got a vote of confidence from Mr. Buffett in 2016. Berkshire bought shares in all four airlines that year.
Smurfit Kappa shareholder Janus Henderson sells down stake to below 3%
15 AUG 2018
Smurfit Kappa [ISE:SKG] [LON:SKG] shareholder Janus Henderson has sold down its stake in the Ireland-based packaging group from 3.9% to less than 3%. The reduced stake was disclosed in an Irish Stock Exchange announcement on Monday, 13 August.
Janus in May threatened to launch a campaign for board changes at Smurfit Kappa due to the board’s rejection of takeover approaches from Tennessee-based rival International Paper [NYSE:IP].
An Irish Times report on 15 August noted that Smurfit’s share price has recovered since dipping in June after IP announced that it was withdrawing its bid. Smurfit’s share price reached up to EUR 36.77 three times last week, the item noted, adding that the price was 12% higher than its previous high in April, when IP was still pursuing a bid. Smurfit’s share price is now 28% higher than it was before news of IP’s initial bid approach in March, the report added.
Market sources cited by the report said Smurfit’s share price may reflect continued bid speculation, although IP is not allowed to return with a fresh bid for 12 months from early June, due to Irish Takeover Panel rules.
Spokespersons for Janus Henderson and Smurfitt Kappa refused to comment, the newspaper said.
Smurfit Kappa’s share price closed EUR 0.30 down at EUR 36.32 in Dublin on Tuesday, valuing the company at EUR 8.61bn.
Link to original source (Irish Times)
ABB rumoured to be interested in GE division - report (translated)
15 AUG 2018
Swiss industrial group ABB [NYSE:ABB] is rumoured to be interested acquiring a division of US conglomerate GE [NYSE:GE], Neue Zuercher Zeitung reported.
The Swiss daily's report noted market rumours that ABB is interested in a deal worth billions of dollars to acquire a division of GE.
>>> Up
* Aareal Bank Upgraded to Buy at DZ Bank; Price Target 43 Euros
* Amundi Upgraded to Overweight at Morgan Stanley; PT 77.50 Euros
* Bank of Georgia Group Raised to Buy at VTB Capital; PT 20 Pounds
* Bayer Downgraded to Hold at Jefferies; PT 92 Euros
* Ceconomy Upgraded to Equal-weight at Morgan Stanley; PT 7 Euros
* Esure Upgraded to Hold at Berenberg
* Greene King Upgraded to Hold at HSBC; PT 5 Pounds
* K+S Upgraded to Sector Outperform at Scotiabank; PT 25 Euros
* KPN Upgraded to Neutral at Macquarie; PT 2.40 Euros
* Mayr-Melnhof Upgraded to Buy at Kepler Cheuvreux; PT 130 Euros
* Mitchells & Butlers Upgraded to Buy at HSBC; PT 2.90 Pounds
>>> Down
* Austevoll Seafood Cut to Sell at ABG; Price Target 100 Kroner
* Curetis Downgraded to Neutral at Ladenburg Thalmann
* Leifheit Downgraded to Sell at Berenberg
* Norway Royal Salmon Downgraded to Sell at ABG; PT 202 Kroner
* Senvion Downgraded to Sell at Bankhaus Metzler
* Valeo Downgraded to Hold at HSBC; PT 45 Euros
After Hours Summary: PETQ +15%, CDLX / SORL +9%, PRSP +4%, CASA -25%, A / CREE / VIAV -2% following earnings/guidance, EGN +9.3% and FANG -5% on M&A dealAfter Hours Gainers:
Companies trading higher in after hours in reaction to earnings/guidance: PETQ +14.9%, CDLX +9.1%, SORL +8.7%, PRSP +3.9%
Companies trading higher in after hours in reaction to news: EGN +9.3% (Energen to be acquired by Diamondback Energy [FANG] in all-stock transaction valued at ~$9.2 bln; representing an implied value to each Energen shareholder of $84.95/share), MRT +7.5% (Bloomberg reporting the company is evaluating options including sale), ADNT +4.5% (will replace DCT Industrial Trust in the S&P MidCap 400), ERI +4.2% (to replace VeriFone S&P MidCap 400), TELL +3.4% (initiated with Outperform at Robert W Baird), DAL +1.3% / GS +1% / LUV +1% (Berkshire Hathaway increased holdings), GNW +1.1% (ticking higher - Genworth Financial and China Oceanwide extend merger agreement), NVDA +0.9% (upgraded to Outperform from Underperform at Wells Fargo), SYMC +0.5% (David Tepper's Appaloosa discloses new holding)
After Hours Losers:
Companies trading lower in after hours in reaction to earnings/guidance: CASA -25.1%, A -2.3%, CREE -2.3%, VIAV -2.1%
Companies trading lower in after hours in reaction to news: SBBP -7.3% (proposed public offering of 9.0 mln ordinary shares), ENPH -6.1% (offering $60 mln of convertible senior notes due 2023 in a private placement), VRAY -5.9% (proposed public offering of $125.0 mln of shares of common stock), FANG -5% (to acquire Energen in all-stock transaction valued at ~$9.2 bln), CRZO -4.6% (commences public offering of 9.5 mln shares of common stock; agreed to acquire Delaware Basin properties from Devon Energy [DVN] for $215 million in cash), IIN -4.2% (proposed offering of 1.5 mln shares of common stock), KANG -1.6% (issues update on 'going private' transaction), MTDR -0.6% (ticking lower -- downgraded to Accumulate from Buy at Johnson Rice), WTW -0.6% (attributed to block trade pricing), GDDY -0.5% (light volume -- announces proposed sale of 10,390,942 shares of Class A common stock by selling stockholders)