David Einhorn (Trades, Portfolio) matched some big investors and diverged from the majority in his fourth-quarter buying activity.
Einhorn is known for adhering to picking stocks that look cheap based on fundamental analysis, having contrarian opinions and waging short-selling campaigns. Often celebrated for his value investing prowess, in 2016 he swung back to a 7.2% return after a challenging year in 2015 in which he lost 20.2%. Since its inception in 1996, Einhorn’s Greenlight Capital hedge fund has returned 16.1% and has had only two down years in its history.
The investor’s portfolio listed 33 long positions valued around $5.82 billion at quarter-end. Its biggest sector, consumer cyclical, encompasses 35.5%, followed by industrials at 20.5%.
In his portfolio filing released yesterday evening, he reported buying the same stock as Warren Buffett (Trades, Portfolio) and Prem Watsa (Trades, Portfolio), Monsanto Co. (MON, Financial). While big-box retailers have been ailing in recent months, he also bought Fred’s Inc. (FRED, Financial) and added to a stake in Rite Aid Corp. (RAD, Financial). Finally, he bought another agriculture company, Syngenta (SYT, Financial) and metals company Alcoa (AA, Financial) and added to his largest position, Apple (AAPL, Financial).
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Einhorn bought 925,000 shares of Syngenta in his largest new buy, making it 1.26% of the portfolio. The stock traded for an average price of $81 per share.
Syngenta has a market cap of $39.71 billion; its shares were traded around $85.44 with a P/E ratio of 34.34 and P/S ratio of 2.98. The trailing 12-month dividend yield of Syngenta stocks is 2.69%. The forward dividend yield of Syngenta stocks is 2.68%. Syngenta had an annual average earnings growth of 0.40% over the past 10 years.
Einhorn bought 410,000 shares of Monsanto, making it 0.74% of the portfolio. The stock traded for an average price of $103 per share.
Monsanto has a market cap of $47.82 billion; its shares were traded around $109.05 with a P/E ratio of 29.47 and P/S ratio of 3.47. The trailing 12-month dividend yield of Monsanto stocks is 1.99%. The forward dividend yield of Monsanto stocks is 2.01%. Monsanto had an annual average earnings growth of 9.40% over the past 10 years. GuruFocus rated Monsanto the business predictability rank of 3.5-star.
Einhorn bought 1.275 million shares of Alcoa, making it 0.62% of the portfolio. The stock traded for an average price of $28.
Alcoa has a market cap of $6.94 billion; its shares were traded around $37.93 with and P/S ratio of 0.73.
Fred’s Inc. (FRED, Financial)
Einhorn bought 1.5 million shares of Fred’s, making it 0.48% of the portfolio. The stock traded for an average price of $11.
Fred's has a market cap of $647.520 million; its shares were traded around $17.08 with and P/S ratio of 0.28. The trailing 12-month dividend yield of Fred's stocks is 1.42%. The forward dividend yield of Fred's stocks is 1.5%.
Rite Aid Corp. (RAD, Financial)
Einhorn increased his stake in defensive retailer Rite Aid by 52.22%, buying 7,019,927 shares for a total of 20,462,962 shares. Rite Aid is 2.9% of his portfolio.
Rite Aid has a market cap of $6.11 billion; its shares were traded around $5.81 with a P/E ratio of 72.64 and P/S ratio of 0.18. Rite Aid had an annual average earnings growth of 17.20% over the past five years.
Einhorn increased his stake in his largest position, Apple, by 11.81%, buying 613,300 shares for a total of 5,807,740 shares. The holding is 11.56% of his portfolio.
Apple has a market cap of $709.7 billion; its shares were traded around $135.27 with a P/E ratio of 16.18 and P/S ratio of 3.41. The trailing 12-month dividend yield of Apple stocks is 1.68%. The forward dividend yield of Apple stocks is 1.69%. Apple had an annual average earnings growth of 42.5% over the past 10 years. GuruFocus rated Apple the business predictability rank of 3-star.
See David Einhorn (Trades, Portfolio)’s portfolio here.
