Shares of Sigma Designs (NASDAQ:SIGM) leapt 7.14% by mid-afternoon Monday, the first trading day since billionaire investor George Soros (Trades, Portfolio) announced he more than doubled his stake in the company to almost 11%, making him its biggest shareholder.
Sigma Designs is a semiconductor company with a $226.9 million market capitalization. Its media platforms power smart TVs and Internet-connected home devices like lighting and security systems. Soros’ New York-based Soros Fund Management, which manages around $30 billion for his family, bought 2.06 million shares of the company on April 12, increasing his position by 102.8%. According to the portfolio history, the fund has been growing its position in Sigma Designs in each quarter since the second of 2016 and last bought shares on Jan. 12.
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- SIGM 15-Year Financial Data
- The intrinsic value of SIGM
- Peter Lynch Chart of SIGM
Soros’ buy comes several weeks after the company reported earnings results for the three months ended Jan. 28. The quarter included a decrease in revenue to $42.7 million, the lowest since April 2014, from $51.5 million for the same period a year prior. Accounting for the decline was lower sales in both its smart TV and home devices markets.
The company also recorded a net loss of $8.7 million or 23 cents per share, compared to $6.2 million or 17 per share in losses one year prior.
After the weak quarter, Sigma decided to hone in its focus on its business in the Internet of Things, a concept that all home devices can connect to the internet, from toasters to washing machines. It will also lower its operating expenses by 10% in 2018, according to the earnings release.
Sigma is one of 18 semiconductor companies in the portfolio of Soros, who historically makes bets on broad market or geopolitical trends. The latest purchase vaulted Sigma to the top of the list by size, followed by ChipMOS Technologies (NASDAQ:IMOS), NXP Semiconductors NV (NASDAQ:NXPI) and InvenSense Inc. (NYSE:INVN) as of year-end.
Soros has had a choppy year, as the Trump rally that enriched many investors ran against his bearish thesis. He lost about $1 billion shorting the market in the months after the presidential election, according to the Wall Street Journal. Soros has built much of his fortune and reputation over the past three decades with currency bets against the British pound, Thai baht and Japanese yen.
See Soros' portfolio here.