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Chase Coleman's Tiger Global Pounces on Procore and UiPath, Curbs Roblox Stake

Tech-focused firm releases 2nd-quarter portfolio

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Aug 19, 2021
Summary
  • Guru's top trades include two IPOs.
  • Coleman trimmed Roblox stake.
  • He also boosted his DoorDash and Zoom positions.
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Chase Coleman (Trades, Portfolio), founder of Tiger Global Management and one of Julian Robertson (Trades, Portfolio)'s former "tiger cubs," disclosed his second-quarter portfolio earlier this week.

As an early investor in Facebook Inc. (

FB, Financial) and Spotify Technology SA (SPOT, Financial), the guru's New York-based hedge fund is known for focusing on small-cap stocks and technology startups. He also searches for value opportunities among early-stage venture, late-stage venture, post-initial public offering and secondary market equities.

Keeping these considerations in mind, Coleman entered 25 new positions during the quarter, sold out of four stocks and added to or trimmed a slew of other holdings. His five largest trades for the quarter included a reduction of the Roblox Corp. (

RBLX, Financial) stake, increased bets on DoorDash Inc. (DASH, Financial) and Zoom Video Communications Inc. (ZM, Financial) as well as new holdings in Procore Technologies Inc. (PCOR, Financial) and UiPath Inc. (PATH, Financial).

Roblox

Impacting the equity portfolio by -1.94%, Coleman curbed the Roblox (

RBLX, Financial) stake by 32.25%, selling 13.04 million shares. The stock traded for an average price of $80.07 per share during the quarter.

He now holds 27.4 million shares total, representing 4.58% of the equity portfolio. It is now his fourth-largest holding. GuruFocus estimates Coleman has gained 15.26% on the investment since establishing it in the first quarter.

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The San Mateo, California-based video game developer has a $46.68 billion market cap; its shares were trading around $81.16 on Thursday with a price-book ratio of 91.01 and a price-sales ratio of 26.29.

Since its initial public offering in March, the stock has climbed nearly 20%.

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GuruFocus rated Roblox’s financial strength 5 out of 10. In addition to a comfortable level of interest coverage, the robust Altman Z-Score of 11.3 suggests it is in good standing. The Sloan ratio, however, indicates the company has poor earnings quality.

The company’s profitability did not fare nearly as well, scoring a 1 out of 10 rating on the back of negative margins and returns on equity, assets and capital that underperform a majority of competitors.

Coleman is the company’s largest guru shareholder with a 4.81% stake. Other gurus who own the stock include

Philippe Laffont (Trades, Portfolio), Spiros Segalas (Trades, Portfolio), Catherine Wood (Trades, Portfolio), Jim Simons (Trades, Portfolio)’ Renaissance Technologies, Stanley Druckenmiller (Trades, Portfolio), Paul Tudor Jones (Trades, Portfolio), Joel Greenblatt (Trades, Portfolio) and First Pacific Advisors (Trades, Portfolio).

DoorDash

With an impact of 1.69% on the equity portfolio, the guru upped his stake in DoorDash (

DASH, Financial) by 87.95%, buying 5.12 million shares. Shares traded for an average price of $146.25 each during the quarter.

Coleman now holds 10.9 million shares total, accounting for 3.62% of the equity portfolio and is his seventh-largest holding. GuruFocus data shows he has gained approximately 16.53% on the investment since establishing it in the fourth quarter of 2020.

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The food delivery service, which is headquartered in San Francisco, has a market cap of $61.59 billion; its shares were trading around $182.25 on Thursday with a price-book ratio of 13.94 and a price-sales ratio of 14.92.

According to the price chart, the stock has fallen more than 3% since its IPO in December 2020.

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DoorDash’s financial strength was rated 6 out of 10 by GuruFocus, driven by a robust Altman Z-Score of 25.6 that indicates it is in good standing. The company also has decent debt-related ratios in comparison to other players in its industry.

The company’s margins and returns, however, are negative and underperform a majority of industry peers.

Of the gurus invested in DoorDash, Coleman has the largest stake with 3.35% of outstanding shares. Laffont,

Steve Mandel (Trades, Portfolio), Frank Sands (Trades, Portfolio) and Baillie Gifford (Trades, Portfolio) also have significant positions in the stock.

Zoom Video Communications

The investor increased his holding of Zoom Video Communications (

ZM, Financial) by 74.8%, buying 1.83 million shares. The transaction had an impact of 1.32% on the equity portfolio. During the quarter, the stock traded for an average per-share price of $332.74.

Coleman now holds 4.3 million shares total, which make up 3.08% of the equity portfolio. According to GuruFocus, he has gained approximately 32.29% on the investment since establishing it in the second quarter of 2019.

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The San Jose, California-based software company, which provides videoconferencing and online chat services, has a $98.87 billion market cap; its shares were trading around $332.80 on Thursday with a price-earnings ratio of 117.48, a price-book ratio of 23.94 and a price-sales ratio of 31.24.

Based on the Peter Lynch chart, the stock appears to be overvalued.

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GuruFocus rated Zoom’s financial strength 7 out of 10. In addition to a comfortable level of interest coverage, the company is supported by a robust Altman Z-Score of 37.87. The return on invested capital also overshadows the weighted average cost of capital, indicating value is being created as the company grows.

The company’s profitability did not fare as well, scoring a 3 out of 10 rating despite having margins and returns that outperform a majority of competitors. Zoom also has a high Piotroski F-Score of 7, meaning its operations are healthy.

With 2.71% of outstanding shares,

Baillie Gifford (Trades, Portfolio) is the company’s largest guru shareholder. Wood, Simons’ firm, Laffont and Sands also have significant stakes in Zoom.

Procore Technologies

As previously disclosed in May, Coleman invested in 9.5 million shares of Procore Technologies (

PCOR, Financial), allocating 1.68% of the equity portfolio to the stake. The stock traded for an average price of $87.67 per share during the quarter.

Headquartered in Carpinteria, California, the company, which provides all-in-one construction management software, has a market cap of $11.44 billion; its shares were trading around $87.23 on Thursday with a price-book ratio of 10.42 and a price-sales ratio of 20.22.

The price chart show the stock has fallen nearly 2% since its IPO on May 20.

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Procore’s financial strength was rated 6 out of 10 by GuruFocus, driven by outperforming debt-related ratios and a high Altman Z-Score of 17.23.

The company, however, is being weighed down by negative margins and returns that are underperforming compared to a majority of industry peers.

Coleman is Procore’s largest guru shareholder with a 7.26% stake.

Lee Ainslie (Trades, Portfolio) and Jones also disclosed positions in the stock.

UiPath

The guru picked up 10.4 million shares of UiPath (

PATH, Financial), dedicating 1.32% of the equity portfolio to the position. During the quarter, shares traded for an average price of $73.46 each.

The New York-based software company, which operates a robotic process automation tool used to automate repetitive or redundant digital tasks without human intervention, has a $31.14 billion market cap; its shares were trading around $61.19 on Thursday with a price-book ratio of 16.56 and a price-sales ratio of 71.59.

Since its IPO in April, the stock has fallen nearly 12%.

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GuruFocus rated UiPath’s financial strength 6 out of 10.

While the company has a comfortable level of interest coverage, it is being weighed down by negative margins and returns that underperform a majority of competitors.

Of the gurus invested in UiPath, Wood has the largest stake with 2.33% of outstanding shares. Laffont, Sands, Jones,

George Soros (Trades, Portfolio), Ron Baron (Trades, Portfolio) and Greenblatt also see value in the stock.

Additional trades and portfolio composition

During the quarter, the guru also increased holdings of DocuSign Inc. (

DOCU, Financial) and Shopify Inc. (SHOP, Financial), while reducing the Salesforce.com Inc. (CRM, Financial) position. He also entered new stakes in Coinbase Global Inc. (COIN, Financial) and DoubleVerify Holdings Inc. (DV, Financial).

Over half of the guru's $53.76 billion equity portfolio, which is composed of 142 stocks, is invested in the technology and consumer cyclical sectors.

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As of the three months ended June 30, Coleman’s five largest holdings were JD.com Inc. (

JD, Financial), Microsoft Corp. (MSFT, Financial), Sea Ltd. (SE), Roblox and DocuSign.

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I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours. Click for the complete disclosure
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