Top US hedge funds bet on Morgan Stanley and AIG
Top U.S. hedge fund management firms, including Dan Loeb's Third Point LLC, took new positions in Morgan Stanley (MS.N) during the fourth quarter, ahead of the bank's cost-cutting measures and bond-management reshuffling.
Third Point purchased 3 million shares, while Carlson Capital bought 2.2 million shares to own 2.3 million shares during the last three months of 2015, regulatory filings showed Friday and Tuesday. Adage Capital added to its position, buying 1.6 million shares to own 4.5 million shares at the end of the quarter, SEC filings showed.
So far this year, Morgan Stanley shares are down more than 27 percent. In January, Morgan Stanley named Sam Kellie-Smith to head its fixed-income trading unit as it seeks to turn around the struggling business. The bank said it was cutting 25 percent of its fixed income jobs because increased regulation has made trading bonds less profitable. These hedge-fund SEC disclosures are backward-looking and come out 45 days after the end of each quarter. Still, the filings offer a glimpse into what hedge fund managers saw as investment opportunities.
The filings do not disclose short positions, or bets that a stock will fall. As a result, the public filings do not always present a complete picture of a management firm's stock holdings. The following are some of the hot stocks and sectors in which hedge fund managers either took new positions or exited existing stakes in the fourth quarter. Omega Advisors increased its stake in the insurer by 731,200 shares to 4.1 million shares. Jana Partners, the hedge fund founded by Barry Rosenstein, bought 4.3 million shares with a market value of $263.6 million at the end of the quarter. So far this year, AIG shares are down 14.5 percent.
AIG has been facing pressure from activist investors Carl Icahn and John Paulson since October to split up, and last week nominated Paulson and an Icahn representative to serve on its board after posting two straight quarterly losses. Icahn increased his stake in AIG in the fourth quarter to 42.2 million shares from 1.4 million shares.
Activist investor Jeff Smith's Starboard Value nearly doubled its holding in the healthcare company to 2.4 million shares. Hedge fund Visium Asset Management bought roughly 1 million shares to own 1.03 million shares. Fellow activist investor Jana Partners, however, had a different view, slashing its stake by half to own 5.7 million at the end of the quarter.
Farallon Capital Management sold its 4.5 million stake in the online marketplace. Meanwhile, Third Point cut its stake by 5 million shares to 4 million shares. John Burbank's Passport Capital, one of 2016's best performers, opened a new position of 4.9 million shares in the industrial conglomerate.
Huber Capital trimmed its stake in the nutrition company by selling 96,800 shares to own 1.2 million shares now. Jana Partners exited the car-rental company, selling 39.2 million shares. Omega Advisors, overseen by Leon Cooperman and Steven Einhorn, sold its entire stake of 500,000 shares in the department store chain. Farallon Capital Management took a new stake of 1.6 million shares in the maker of coffee-brewing machines. Distressed investor Marc Lasry exited the bond insurer, selling 75,000 shares.
Some existing investors in candy and food maker Mondelez, which has caught the attention of activists Pershing Square Capital and Trian Partners, raised their stakes, including Passport Capital, which owned 1.2 million at the end of the quarter. Zweig-Dimenna Associates bought 187,900 additional shares to own 394,650 shares. But Boston-based Adage Capital Partners cut its stake nearly in half, selling 2.2 million shares to own 2.7 million at the end of the quarter.
Jana added a new stake of 9.2 million shares in the drug maker. Suvretta Capital added 1.9 million shares to own 2.5 million. Omega Advisors cut its stake by 3.5 mln shares to 1.3 million shares. Seth Klarman's Baupost Group exited the stock of the oil and gas exploration company, selling 4.1 million shares. Senator Investment Group exited its 500,000share position.
Activist investor Starboard Value cut its stake in the packaging company by 26 percent to 4.5 million shares. Jana Partners took a new position of 3.8 million shares in the energy company.Jet Capital added a new position, buying 2.1 million shares of the Internet company, while Carlson Capital bought 2.9 million shares, also a new position. Yahoo shares are down 18.7 percent year-to-date.
Serengeti took a new position in the restaurant company, buying 135,000 shares. Third Point slashed its stake by 11.5 million shares to just 75,300 shares. Jana Partners sold 3.9 million shares to exit the animal health company, which was spun off by Pfizer.