Where Did Greenlight Capital Place Its Bets in 2Q16?
Greenlight Capital is a popular hedge fund management firm. David Einhorn, its president, is well known for his strong investment strategies that have made millions of dollars for his clients. He made a huge profit by shorting the US oil (USO) (UWTI) drillers in mid-2014. After employing this strategy, he became more popular in the industry (QQQ). Read Why Is David Einhorn Still Bearish on US Oil Drillers? to learn more.
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Holdings of Greenlight Capital
David Einhorn is a big fan of technology stocks. He allocated major portions of the firm’s portfolio to technology stocks such as Apple (AAPL), EMC (EMC), and Yahoo (YHOO) in 1Q16. In 2Q16, the firm made some changes in its holding structure.
The firm’s top 2Q16 purchase was Mylan NV (MYL), a health care stock. The firm bought 2.1 million shares of the company. It now holds 4.9 million shares worth $240.6 million. This stock represents 3.7% of the firm’s portfolio holding. The firm also acquired a stake in independent power producer Calpine (CPN), which bought 5.7 million shares worth $83.5 million in 2Q16. However, the firm has a sizeable investment in consumer discretionary (XLY), technology (XLK), and communications (VOX). These sectors account for 26.8%, 15.6%, and 15.5% of the firm’s portfolio holdings, respectively.
The firm’s largest sales
The firm sold some of its holdings in Apple (AAPL) in 2Q16. Apple makes up 11.4% of the firm’s portfolio. The firm owns 0.1% of Apple’s shares. The largest investor in Apple is Vanguard Group with 331.3 million shares as of June 30, 2016.
Greenlight Capital also exited its investment in Macy’s (M) in the second quarter. Macy’s declared its 2Q16 results on August 11, 2016. The company beat analysts’ earnings and sales estimates for 2Q16. Its adjusted earnings per share were $0.54 in 2Q16, which beat the consensus analyst estimate of $0.45. Its 2Q16 sales met expectations, but they were lower as compared to previous quarters. The company also declared on August 11, 2016, that it would close 100 full-line stores. To learn more, please read Macy’s 2Q16 Sales ahead of Expectations, but Continue to Slide.
In the next part of this series, we’ll analyze Starboard Value’s portfolio as of June 30, 2016.