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Steven Cohen, George Soros, John Paulson All Added to Holdings in February
Posted by: Holly LaFon (IP Logged)
Date: March 7, 2012 04:15PM

Steven Cohen, George Soros and John Paulson are three of the most formidable investors alive today. All three of them added to one of their major holdings so far in 2012. Steven Cohen of SAC Capital Advisors added Dynavax Tech Cp (DVAX), George Soros of Soros Fund Management LLC added Acacia Research (ACTG) and John Paulson of Paulson & Co. added Novagold Resources (NG).

Steven Cohen Adds Dynavax (DVAX)

Cohen bought 3 million Dynavax shares at an average of $2.44 per share in the third quarter of 2011 and in the fourth quarter, he added 4,024,399 shares at an average price of $2.79. According to GuruFocus Real Time Picks, he increased this stake 11.84% at an average price of $4.04 in February. He now owns 7,856,130 shares or a passive 5.1% stake in the company.

Dynavax Technologies discovers, develops and intends to commercialize innovative products to treat and prevent allergies, infectious diseases and chronic inflammatory diseases. Dynavax has a market cap of $616.4 million; its shares were traded at around $4.03 with and P/S ratio of 25.7.

Dynavax has not been a profitable business or had free cash flow in at least the last ten years. Its revenue dropped from $40.3 million in 2009 to $24 million in 2010.

Currently the company is partnering with GlaxoSmithKline (GSK) and AstraZeneca (AZN) on an adult hepatitis B vaccine, which has been proven effective in Phase 3 clinical trials.

The company is having to spend less on clinical trial expenses for Heplisav now that it completed a phase 3 study. It spent $69.2 million in operating expenses in the year ended Dec. 31, 2011, compared to $71.5 million in the year ended Dec. 31, 2010. Its cash position also improved due to milestone payments from GSK and AZNe. It had cash of $114 million at the year ended Dec. 31, 2011, compared to $72.2 million at Dec. 31, 2010.

There are four other medicines in Dynavax’s pipeline, for Hepatitis B, asthma, autoimmunity/inflammation and a flu vaccine.

Acacia Research Corporation (ACTG)

George Soros built up his holding of Acacia Research Corp. to 1,554,468 from the fourth quarter of 2010 to the second quarter of 2011, paying an average price of $26, $29 and $37 per share in each respective quarter. As the price rose higher, he sold 784,343 shares in the third quarter at an average of $40, and in the fourth quarter of 2011 he sold 369,252 shares at an average price of $36. According to GuruFocus Real Time Picks, he increased this holding by 598.8% in February and now owns 2,801,180 shares, or 5.6% of the company.

Acacia Research develops, licenses and provides products for the life science and media technology sectors. Acacia Research has a market cap of $1.64 billion; its shares were traded at around $37.52 with a P/E ratio of 51.6 and P/S ratio of 9.5.

Acacia research has successfully grown its revenue and free cash flow each year since 2008, and made its EBITDA and net income turn positive since 2009. It also built up its balance sheet, increasing its cash to $315 million at the end of 2011, from $103 million in 2010, while long-term liabilities have decreased from $1 million in 2010 to $0.63 million in 2011.

On February 16, four days before Soros reported adding Acacia stock, the company announced that for the first quarter of 2012 it expects its highest level of quarterly revenues to date. It also has the largest number of licensing opportunities in its history, and expects continued growth in new licensing programs and patent portfolios for future licensing. Quarterly revenue, it predicts, will be uneven.

Novagold Resources (NG)

John Paulson bough 20, 181,818 shares of NovaGold in the first quarter of 2010 at an average of $6 per share; he added 26,200 shares in the third quarter at an average of $9 per share, and 2,746,800 in the fourth quarter at an average of $9 per share. According to GuruFocus Real Time Picks, in February he increased this holding 30.49% and now owns 29,954,818 shares or 10.8% of the company.

NovaGold Resources is a gold and copper company engaged in the exploration and development of mineral properties in Alaska and Western Canada. NovaGold has a market cap of $2.26 billion; its shares were traded at around $7.68 with and P/S ratio of 5622. NovaGold had an annual average earnings growth of 31.1% over the past 10 years.

It is not a surprise that Paulson would increase his gold holdings. He said in his 2011 investor letter that “my gold fund will top all others.” He added:
Quote:
We anticipate that the divergence between gold and gold equities will narrow, given the booming earnings that a number of the major gold producers are delivering...We remain excited about the outlook for the Paulson Gold Funds over the next few years. Central banks have engaged in unprecedented amounts of quantitative easing, while investors are increasingly losing faith in paper currencies. The sovereign debt crisis in Europe continues to threaten the stability of the global financial system. In this environment, gold stands out as the most stable and credible currency alternative and we would argue that the potential upside in gold outweighs the potential downside. Gold equities are attractively priced given the strong financial performance than many of these companies are delivering... The Paulson Gold Funds, which are designed to outperform gold in a rising gold price environment, provides investors with a hedge against inflation and more.
NovaGold does not have the robust earnings Paulson speaks of. But for the year ended Nov. 30, 2011, the company’s loss narrowed to $153 million, from $203.5 million, for 2010. Revenues declined to $111 million for 2011 from $172 for 2010. The company had $66.8 million in cash at the end of November.

In February, NovaGold announced significant new drill results at its 50%-owned Galore Creek site located in Canada. It saw copper and gold grades far higher than what was set forth in its pre-feasibility study. If the company goes through with its plan to develop the project, it would be the largest copper mine in Canada.

NovaGold plans to become a pure play on its flagship Donlin Gold project, sell all or part of its Galore Creek Project, and create a newly formed subsidiary, NovaCopper, whose share it would distribute entirely to shareholders of NovaGold.

See the portfolio of Steven Cohen, the portfolio of George Soros and the portfolio of John Paulson. Also check out the Undervalued Stocks, Top Growth Companies, and High Yield stocks of Steven Cohen, the Undervalued Stocks, Top Growth Companies, and High Yield stocks of George Soros and the Undervalued Stocks, Top Growth Companies, and High Yield stocks of John Paulson.




Guru Discussed: Steven Cohen: Current Portfolio, Stock Picks
George Soros: Current Portfolio, Stock Picks
John Paulson: Current Portfolio, Stock Picks
Stocks Discussed: ACTG, DVAX, NG, AZN, GSK, GLD,
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