Lee Ainslie

Last Update: 2014-08-29

Number of Stocks: 49
Number of New Stocks: 15

Total Value: $6,968 Mil
Q/Q Turnover: 34%

Countries: USA
Details: Top Buys | Top Sales | Top Holdings  Embed:

Lee Ainslie' s Profile & Performance

Profile

Founder and CEO of Dallas based Maverick Capital. Lee Ainslie started Maverick Capital back in 1993 with $38 million. Nowadays, the fund is worth $10 billion. Also learned from legendary great Julian Robertson at Tiger Management, Ainslie has averaged more than 13% a year since from 1995 to 2009. In the market crash of 2008, his fund lost about 30%.

Web Page:http://www.maverickcap.com/

Investing Philosophy

Maverick has six industry sector heads, most of whom are more or less the same age as Mr. Ainslie. They are the experts in their respective industries: consumer, health care, cyclical, retail, financial, and telecommunications, media, and technology. Mr. Ainslie talks to them throughout the day about new and current stocks in the portfolio. With that input, he ultimately makes the final decision.

Total Holding History

Performance of Maverick Fund

YearReturn (%)S&P500 (%)Excess Gain (%)
201011.215.06-3.9

Top Ranked Articles

Lee Ainslie Victimized by Alleged Chinese Fraud Stock
Lee Ainslie has reportedly lost a small fortune on Longtop Financial Technologies (LFT). Longtop's auditors, a big four accounting firm, Deloitte Touche, has resigned due to accounting irregularities. Read more...
CEO of JPMorgan James Dimon Buys 500,000 Shares
Chairman & CEO of JPMorgan Chase & Co. (JPM) James Dimon bought 500,000 shares on 07/20/2012 at an average price of $34.22. The total transaction amount is $17,110,001. JPMorgan Chase & Co. is a global financial services firm. JPMorgan Chase & Co. has a market cap of $129.05 billion; its shares were traded at around $34.4 with a P/E ratio of 7.6 and P/S ratio of 1.3. The dividend yield of JPMorgan Chase & Co. stocks is 3.5%. Read more...
Michael Dell to buy his own Company ?
I've been watching the twitter updates from the Value Investing Congress being held today.

One interesting presentation came from Lee Ainslie of Maverick Capital. Ainslie runs about $10 billion of capital and previously worked for Julian Robertson of Tiger Management.

He speculated that the founder of Dell might take the entire company private given its very low cash flow yield.

He further foused on other large high quality tech companies that generate a lot of cash and are putting that cash to work through buybacks, dividends and intelligent acquisitions.

The companies that he focused on were

Adobe (ADBE), Cisco (CSCO), CommScope (CTV), Hewlett-Packard (HPQ), Intel (INT), IBM (IBM), Marvell Technology (MRVL) and of course the darling of the value investor these days Microsoft (MSFT).

Ainslie mentioned that his firm currently has a net long 17% exposure to tech stocks which is the largest ever. He believes that the sector is cheap and that the market is assigning virtually no extra value to high-quality, high-growth companies.

Ainslie's message isn't unique. I've documented a virtual who's who of great investing minds over the past couple of months who are pounding the table on large cap quality.

http://www.gurufocus.com/news.php?id=108577

Ainslie believes that eventually the market will return to paying a premium for companies with strong balance sheets, high returns on equity and solid earnings growth.

The Maverick manager highlighted ten tech stocks including Adobe, Cisco and Dell, with CommScope as his top pick. This group is down 13% on average so far this year.

“Maverick has important holdings in this group,” Ainslie said, with lots of cash that’s earning nothing. “It’s very important to try to make sure these companies are using cash in a way that’s productive for the shareholder,” citing buybacks, dividends and smart acquisitions as examples.

“Mostly that’s happening,” he added. So far this year, one-third of all buyback activity has come from tech companies, while the sector makes up about one-sixth of the stock market, Ainslie calculated.

These tech companies are also generating a lot of new cash to add to their hoards. The average free cash-flow yield of this group of 10 tech stocks is 9%, according to the manager.

Meanwhile, corporate-bond yields are very low. In fact, equity free cash-flow yield is higher than corporate-bond yields for the first time since 1957, Ainslie noted.

This arbitrage between free cash-flow yield on tech stocks and yields on corporate bonds is too good to ignore,” he said

It is a common message. Buy high quality large equities, avoid bonds. Read more...
Wells Fargo - Is the best stock to get US financial exposure ?
Wells Fargo & Company provides retail, commercial, and corporate banking services primarily in the United States. The company operates in three segments: Community Banking; Wholesale Banking; and Wealth, Brokerage, and Retirement. It widely operates through its branches. Read more...
Thursday Value Overview
A big rally today across the board as we heard another potential resolution with Greece, great news out of Morgan Stanley (MS), and since denied rumors of a debt ceiling deal. I have a link to some Chuck Royce commentary, news from Lee Ainslie, an announcement of the merger between Express Scripts (ESRX) and Medco (MHS), which actually may make sense, John Paulson comments to investors and some more skepticism on the debt deal. Read more...
» More Lee Ainslie Articles

Maverick Capital is a hedge fund located in GuruFocus’s own Dallas metroplex. Led by Lee Ainslie, this fund has been in operation since its inception in 1993. Lee Ainslie earned his bachelor’s degree in system engineering from The University of Virginia, and his MBA from the University of North Carolina. Ainslie was recruited at UNC to work for legendary hedge fund manager Julian Robertson in 1990. In addition to his hedge fund duties, Ainslie serves as the vice-chairman of the Robin Hood Foundation, and on the board of trustees for several organizations such as the Green Vale School.

“I was deciding whether to return to management consulting (my first career) or to go into investment banking; Julian gave me an opportunity to come to New York to work for Tiger”

Lee Ainslie worked for Julian Robertson’s Tiger Management, one of the earliest hedge funds to be founded. Utilizing a value-oriented approach to investments, his success launched the explosion of the hedge fund industry. As referenced in a previous article (http://www.gurufocus.com/news.php?id=126342), many of these analysts would go on to launch their own hedge funds after training and tutorage from Robertson. These new fund managers became a generation known as “tiger-cubs”, so eloquently referring to the roots of their training. Ainslie served as a managing director for Tiger Management and as a technological analyst for 3 years.

“….Evaluating management teams (of companies you were considering investing in) is critically important.”

Maverick Capital at its very core is a long/short equities fund. They invest in companies utilizing a fundamental bottoms-up approach to analyze equities. Ainslie operates with a long term view on value, much like his mentor, and this can be seen in their capital funding requirement. For the most part, his fund is widely closed to most investors, as he prefers dedicated and sophisticated investors. They prefer capital from investors with ties and influence on corporate boards across several spectrums of industry, in order to maintain and grow their business network. Furthermore, he typically has investors commit to a three year period, in order to achieve long term maximum value. Each position comprises no more then 5-8% of the overall portfolio, and is analyzed not upon quarterly earnings, but on a large annualized view with an optimal investment holding of 1-3 years out.

In terms of shorting equities, Lee Ainslie stated that: “Our short exposure is achieved by shorting individual stocks, which I think is increasingly unusual these days. But to us, it’s critical, because we want to add value on both the long side and the short side. If you use market-related indexes to create your short exposure, by definition it’s not going to add value.”

In terms of performance, Maverick Capital returned 11.2% vs. the S&P benchmark of 15.1% in 2010. Much of this loss was attributed to their short holdings, as is stated in their 2010 shareholder letter (http://neoalpha.blogspot.com/2011/02/maverick-capital-2010-annual-letter.html), “nine of our ten largest losses on the year were in short investments”. Since 1995 however, Maverick Capital had an annualized return of 14% vs. the S&P 8.1%.

Maverick Capital’s portfolio composition for the two most recent quarters of 2010 is shown in the following table. Comparatively speaking, Lee Ainslie increased his holdings in technology and financials by 3.40% and 3.90% respectively. Furthermore, he initiated a minor position in the basic materials sector. Conversely, he reduced his holdings in consumer services, health care, consumer goods, and industrials by a relatively modest amount.

 

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