Every quarter, fund managers have to disclose what they've bought and sold. Their latest moves can shine a bright light on smart stock picks.
Today let's look at Lone Pine Capital, founded by Steve Mandel in 1997. Prior to that, Mandel was a managing director at Tiger Management. Lone Pine is one of the biggest hedge fund companies and reportedly beat the S&P 500 for 11 years in a row. Like many value investors, Mandel is known to dig deep into companies, aiming to buy undervalued ones.
Lone Pine Capital's stock portfolio totaled $13.9 billion in value as of Dec. 31, 2011, with 57 holdings. The fund's top three holdings, representing 17% of total assets, are Apple, Google, and priceline.com.
So what does Lone Pine Capital's latest quarterly 13F filing tell us? Here are a few interesting details:
New holdings include Chinese search-engine giant Baidu (NAS: BIDU) and Green Mountain Coffee Roasters (NAS: GMCR) . Baidu, thought of by some as China's Google, has been frustrating naysayers for years now. (You can count me among those who wish they hadn't sold their shares awhile back.) It recently posted quarterly revenue and earnings up 83% and 77%, respectively, over year-ago levels. And as China's population grows and its economy develops, more and more people will be online, likely tapping its services. Green Mountain has also performed better than many expected, and some have high hopes for its new Vue brewer -- partly because of technical difficulties with previous ones.
Among holdings in which Lone Pine increased its stake was Las Vegas Sands (NYS: LVS) . Like other casino operators, Las Vegas Sands has struggled with Vegas-based properties, but unlike some others, it also operates in Macau -- very profitably. Some may worry about a recent slowdown in growth there, but remember that less strong growth is still strong growth. The company is still expanding in Macau and also has its eyes on Singapore, Japan, Korea, Taiwan, Vietnam, and India.
Lone Pine reduced its stake in lots of companies, including Qualcomm (NAS: QCOM) , a company known for raking in gobs of money off its patents. Its technology is not only in Apple products, but seems poised to increase its presence there, as well. Its Snapdragon chips are in hundreds of devices, actually, and it's developing more offerings.
Finally, Lone Pine unloaded several companies, including Schlumberger (NYS: SLB) . One possible concern regarding the oil-field services company is its shrinking profit margins. It's a giant in its industry, though, investing hundreds of millions annually in research and development, which is likely to lead to future profits. Also, as my colleague David Lee Smith has noted, "Schlumberger has the wherewithal to both develop and acquire the industry's most advanced systems and equipment."
We should never blindly copy any investor's moves, no matter how talented the investor. But it can be useful to keep an eye on what smart folks are doing. 13F forms can be great places to find intriguing candidates for our portfolios.
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At the time thisarticle was published
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