Caxton Associates Reduces Stake in Walmart

Jun 05, 2015

Caxton Associates (Trades, Portfolio), a New York-based hedge fund, relies on global markets research and worldwide economic tendencies to identify investment opportunities. Considering the speed with which economic trends can shift, it isn’t surprising that Caxton’s portfolio has a 26% quarter-over-quarter turnover rate.

The greatest impact to Caxton Associates (Trades, Portfolio)’ portfolio in the first quarter was felt by its stakes reductions, and the most significant of those was the reduction in Caxton’s stake in Walmart (WMT, Financial), the Bentonville, Arkansas-based department store chain. Caxton sold 1,300,200 shares for an average price of $85.11 per share. The reduction had a -8.64% impact on Caxton’s portfolio.

Caxton also reduced its position in Best Buy Co Inc (BBY, Financial), a Minnesota-based consumer electronics retail chain, by 1,130,000 shares. Caxton received an average of $38.25 per share; the transaction had a -3.42% impact on Caxton’s portfolio.

Best Buy has a market cap of $12.16 billion and an enterprise value of $9.9 billion. It has a P/E of 10.1, a Price/Book of 2.5 and a Price/Sales of 0.3. Jim Simons (Trades, Portfolio), Joel Greenblatt (Trades, Portfolio), HOTCHKIS & WILEY, Mario Gabelli (Trades, Portfolio), Paul Tudor Jones (Trades, Portfolio), Lee Ainslie (Trades, Portfolio) and David Dreman (Trades, Portfolio) have shares of Best Buy in their portfolios. Steven Cohen (Trades, Portfolio) sold his stake in the first quarter.

Caxton also sold a portion of its existing stake in General Motors Co (GM, Financial), an automotive company based in Detroit. Caxton sold 1,210,800 shares of GM for an average price of $36.37 per share. The sale had a -3.31% impact on Caxton’s portfolio.

Caxton’s other first-quarter reductions included Target Corp (TGT, Financial), Morgan Stanley (MS, Financial) and The Michaels Companies Inc (MIK, Financial).

Caxton sold its stakes in 62 companies. The most significant divestiture was the sale of Caxton’s 1,000,000-share stake in HD Supply Holdings Inc (HDS, Financial), a North American industrial distributor, for an average price of $29.09 per share. The sale had a -2.3% impact on Caxton’s portfolio.

HD Supply Holdings has a market cap of $6.56 billion and an enterprise value of $11.73 billion. It has a P/E of 16,625 and a Price/Sales of 0.7. Jana Partners (Trades, Portfolio), John Griffin (Trades, Portfolio), David Tepper (Trades, Portfolio), Steven Cohen (Trades, Portfolio), Jim Simons (Trades, Portfolio), Paul Tudor Jones (Trades, Portfolio) and John Burbank (Trades, Portfolio) have shares of HDS in their portfolios. Louis Moore Bacon (Trades, Portfolio), Joel Greenblatt (Trades, Portfolio) and Pioneer Investments (Trades, Portfolio) sold their stakes in the first quarter.

Caxton also sold its stakes in Foot Locker Inc (FL, Financial), Macy's Inc (M, Financial) and McDonald's Corp (MCD, Financial).

Caxton made 87 new buys in the first quarter. The purchase of 1,327,000 shares of Cisco Systems Inc (CSCO, Financial), a California-based computer networking equipment company, for an average price of $28.15 per share had the greatest impact on Caxton’s portfolio – 1.51%.

Other new buys in the first quarter included Comcast Corp (CMCSA, Financial), Dollar General Corp (DG, Financial), Yum Brands Inc (YUM) and Apple Inc (AAPL).

Caxton added to 22 existing stakes in its portfolio. The most noteworthy was the purchase of 805,000 shares of Tyson Foods Inc (TSN), a Springdale, Arkansas-based food processing company, for an average price of $40 per share. The transaction had a 1.27% impact on Caxton’s portfolio.

Caxton also added to its stake in Bank of America Corporation (BAC), a North Carolina-based banking and financial services corporation. Caxton bought 1,701,680 shares for an average price of $16.06 per share. The purchase had a 1.08% impact on Caxton’s portfolio.

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