The investor explained in his fourth quarter letter:
“The parabolic rise of a growing number of market-leading story stocks created a challenging environment for value investors. Speculators have momentarily accepted the ruse that, for these visionary companies, profitability would be a mistake. Eventually, the market will remember that having a disruptive product that customers will happily buy if sold near cost is not the same as having a valuable business. Philosophically, since we would not expect to be long these high-fliers, the best we can hope to do is not be short them at the wrong time. For the most part, we weren’t.”
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- BP 15-Year Financial Data
- The intrinsic value of BP
- Peter Lynch Chart of BP
Einhorn purchased eight new stocks in the fourth quarter, for a total of 38 within his portfolio, which is valued at $7.3 billion. Slightly more than half is allocated in the tech sector.
Top New Buys
Anadarko Petroleum Corp (NYSE:APC)
He bought 1.83 million Anadarko shares, giving the company a 2% portfolio weight. Shares cost $90 on average in quarter four.
Anadarko Petroleum Corp was incorporated in the State of Delaware. Anadarko Petroleum Corp has a market cap of $41.04 billion; its shares were traded at around $81.54 with a P/E ratio of 23.30 and P/S ratio of 2.80. The dividend yield of Anadarko Petroleum Corp stocks is 0.70%. Anadarko Petroleum Corp had an annual average earnings growth of 1.40% over the past 10 years.
EMC Corp (NYSE:EMC)
Einhorn purchased 2,892,185 shares of EMC Corp, a 1% portfolio weighting. Shares cost $24 on average in quarter four.
EMC Corp is a Massachusetts corporation, incorporated in 1979. EMC Corp has a market cap of $52.27 billion; its shares were traded at around $25.40 with a P/E ratio of 20.40 and P/S ratio of 2.50. The dividend yield of EMC Corp stocks is 1.20%. EMC Corp had an annual average earnings growth of 18.80% over the past 10 years. GuruFocus rated EMC Corp the business predictability rank of 3-star.
Take-Two Interactive Software Inc. (NASDAQ:TTWO)
Einhorn bought 4,163,272 Take-Two Interactive Software shares, for a 0.99% portfolio weight. Shares cost $17 on average in quarter four.
Take-Two Interactive Software Inc. was incorporated under the laws of the State of Delaware in 1993. Take-two Interactive Software Inc. has a market cap of $1.87 billion; its shares were traded at around $19.11 with a P/E ratio of 6.70 and P/S ratio of 0.80.
McDermott International Inc. (NYSE:MDR)
Einhorn purchased 7,843,005 shares of McDermott International, a 0.99% portfolio weight. Shares cost $8 on average in quarter four.
McDermott International Inc. was incorporated under the laws of the Republic of Panama in 1959. McDermott International Inc. has a market cap of $2.04 billion; its shares were traded at around $8.61 with and P/S ratio of 0.70.
BP Plc (NYSE:BP)
Einhorn purchased 980,000 BP Plc shares, a 0.65% portfolio weight. Shares cost $46 on average in quarter four.
BP Plc operates as an integrated oil and gas company and is the parent company of the BP group of companies. Bp Plc has a market cap of $151.63 billion; its shares were traded at around $48.81 with a P/E ratio of 6.50 and P/S ratio of 0.40. The dividend yield of Bp Plc stocks is 4.60%.