Lee Ainslie Sells Kraft Heinz, Cuts Priceline Holding

Maverick Capital's largest trades in the 3rd quarter

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Dec 11, 2015
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Founder and CEO of Maverick Capital Lee Ainslie (Trades, Portfolio) started the firm in 1993, as a registered investment adviser managing private investment funds exclusively for qualified investors.

These were his most heavily weighted trades during the third quarter.

Ainslie sold out his stake in The Kraft Heinz Co. (KHC) with an impact of 6.77% on the portfolio.

The company is a consumer packaged food and beverage company in North America and worldwide. It manufactures and markets food and beverage products, including cheese, meats, refreshment beverages, coffee, packaged dinners, refrigerated meals, snack nuts, dressings and other grocery products. During the third quarter, GAAP net sales increased 136%, while GAAP operating income declined 2.4% year over year. These results reflect continued progress as they integrate these two great companies, Kraft and Heinz, while driving greater accountability, discipline and efficiency.

The stock looks expensive at the current price of $71. The DCF calculator gives a fair value of $23.86, estimating the stock is highly overvalued by 199%. GuruFocus gives The Kraft Heinz a profitability and growth rating of 4 out of 10 with positive returns (ROE 11.29%, ROA 3.30%) that are outperforming 50% of the companies in the Global Packaged Foods industry. Financial strength has a rating of 5 out of 10, with a cash to debt of 0.18 that is far below the industry median of 0.50.

The largest shareholder among the gurus is Warren Buffett (Trades, Portfolio) with 26.84% of outstanding shares, followed by Daniel Loeb (Trades, Portfolio) with 0.68% and John Griffin (Trades, Portfolio) with 0.23%.

Ainslie also reduced his stake in Priceline Group Inc. (PCLN) by 83.04% with an impact of 5.31% on the portfolio. The holding is 1.31% of his total assets.

The company is a provider of online travel and travel-related reservation and search services. The company offer consumers accommodation reservations (including hotels, bed and breakfasts, hostels, apartments, vacation rentals and other properties) through its Booking.com, priceline.com and agoda.com brands. The group's gross profit for the third quarter had an increase of 12% from the prior year, approximately 29% on a constant currency basis, and non-GAAP net income had a 10% increase versus the prior year.

The stock looks undervalued at the current price of $1,291. The DCF calculator gives a fair value of $1,373.31 estimating the stock is undervalued by 6%. GuruFocus gives Priceline Group a profitability and growth rating of 8 out of 10 with strong returns (ROE 29.05%, ROA 15.50%) that are outperforming 93% of the companies in the Global Leisure industry. Financial strength has a rating of 8 out of 10.

Frank Sands (Trades, Portfolio) is largest shareholder of the company among the gurus with 2.37% of outstanding shares, followed by Steve Mandel (Trades, Portfolio) with 1.99% and Dodge & Cox with 1.35%.

Ainslie also decreased his stake in Allergan PLCÂ (AGN) with an impact of 62.23% on the portfolio. The holding is 2.7% of his total assets.

The company is engaged in the development, manufacturing, marketing, sale and distribution of generic, branded generic, brand name, biosimilar and over-the-counter pharmaceutical products.

GuruFocus gives Allergan a profitability and growth rating of 8 out of 10 with ROA of 3.62% that is outperforming 50% of the companies in the Global Drug Manufacturers - Specialty & Generic industry. Financial strength has a rating of 6 out of 10, with a very weak cash to debt of 0.05 that is far below the industry median of 1.47.

The largest shareholder among the gurus is Vanguard Health Care Fund (Trades, Portfolio) with 2.33% of outstanding shares, followed by Andreas Halvorsen (Trades, Portfolio) with 1.83% and John Paulson (Trades, Portfolio) with 1.82%.

Ainslie also reduced his shares of Avago Technologies Ltd. (AVGO) by 71.41% with an impact of 3.09% on the portfolio. The holding is 0.22% of his total assets.

For fourth quarter fiscal year 2015, net revenue had an increase of 6% versus the previous quarter and an increase of 16% from the same quarter last year. Gross margin was 54% of net revenue, compared with gross margin of 51% of net revenue last quarter, or 50% of net revenue in the same quarter last year.

The stock looks expensive at the current price of $144.72. The DCF calculator gives a fair value of $40.24, estimating the stock is highly overvalued by 260%. GuruFocus gives Avago Technologies a profitability and growth rating of 8 out of 10 with good returns (ROE 29.22%, ROA 10.29%) that are outperforming 83% of the companies in the Global Semiconductors industry. Financial strength has a rating of 8 out of 10, with a cash to debt of 0.34 that is far below the industry median of 1.63.

Andreas Halvorsen (Trades, Portfolio) is largest shareholder of the company among the gurus with 2.52% of outstanding shares, followed by Daniel Loeb (Trades, Portfolio) with 0.6% and Meridian Funds (Trades, Portfolio) with 0.42%.

Ainslie reduced his stake in Team Health Holdings Inc. (TMH) by 93.98% with an impact of 2.53% on the portfolio. The holding is 0.22% of his total assets.

The company is the supplier of outsourced healthcare professional staffing and administrative services to hospitals and other healthcare providers in the U.S.

The stock looks under valued at the current price of $53.51. The DCF calculator gives a fair value of $15.73, estimating the stock is undervalued by 240%. GuruFocus gives Team Health Holdings a profitability and growth rating of 6 out of 10 with ROE 22.91% that is outperforming 64% of the companies in the Global Staffing & Outsourcing Services industry. Financial strength has a rating of 7 out of 10, with a cash to debt of 0.02 that is far below the industry median of 2.02.

The largest shareholder among the gurus is Alan Fournier (Trades, Portfolio) with 4.28% of outstanding shares, followed by Steven Cohen (Trades, Portfolio) with 0.71%.

Ainslie sold out his shares of Baidu Inc. (BIDU) with an impact of 2.42% on the portfolio.

The company is a Chinese language Internet search provider. The stock looks expensive at the current price of $207.14. The DCF calculator gives a fair value of $157.78, estimating the stock is overvalued by 31%. GuruFocus gives Baidu a profitability and growth rating of 7 out of 10 with strong returns (ROE 22.43%, ROA 11.24%) that are outperforming 79% of the companies in the Global Internet Content & Information industry. Financial strength has a rating of 9 out of 10, with a high cash to debt of 1.87 that is still below the industry median of 14.03.

Frank Sands (Trades, Portfolio) is largest shareholder of the company among the gurus with 3.12% of outstanding shares, followed by Dodge & Cox with 2.37% and David Herro (Trades, Portfolio) with 1.35%.

Ainslie also sold out his stake in Charter Communications Inc. (CHTR) with an impact of 2.34% on the portfolio.

The company offers its customers traditional cable video programming, Internet services, and voice services, as well as video services such as video on demand, HD television and DVR service.

GuruFocus gives Charter Communications a profitability and growth rating of 6 out of 10 with negative returns (ROE 282.23%, ROA 0.79%) that are under performing 98% of the companies in the Global Pay TV industry.

The largest shareholder among the gurus is Warren Buffett (Trades, Portfolio) with 9.16% of outstanding shares, followed by Steve Mandel (Trades, Portfolio) with 5.84% and Jeremy Grantham (Trades, Portfolio) with 3.46%.

Ainslie reduced his shares in Vulcan Materials Co. (VMC) by 76.74%, with an impact of 1.89% on the portfolio. The holding is 0.68% of his total assets.

It is a producer of construction aggregates, namely crushed stone, sand and gravel and also produces asphalt mix and ready-mixed concrete. During the third quarter, the company reported a 36% increase for total revenues from the corresponding period in 2014, and a 35.9% decrease for operating profit from the year-ago quarter.

The stock looks expensive at the current price of $99.54. The DCF calculator gives a fair value of $14.02, estimating the stock is highly overvalued by 610%. GuruFocus gives Vulcan Materials a profitability and growth rating of 7 out of 10 with weak returns (ROE 4.03%, ROA 2.08%) that are under performing 63% of the companies in the Global Building Materials industry. Financial strength has a rating of 5 out of 10, with a cash to debt of 0.09 that is far below the industry median of 0.39.

Steve Mandel (Trades, Portfolio) is largest shareholder of the company among the gurus with 2.4% of outstanding shares, followed by First Eagle Investment (Trades, Portfolio) with 2.12% and T Rowe Price Equity Income Fund (Trades, Portfolio) with 1.94%.