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James Li
James Li
Articles (569)  | Author's Website |

Tiger Management’s Top 3 Sells Outweigh Top 3 Buys in 4th Quarter

Firm discloses quarterly portfolio

Tiger Management, founded by legendary hedge fund manager Julian Robertson (Trades, Portfolio), disclosed Wednesday its top three buys and sells for the quarter ending Dec. 31, 2017. The firm divested 88% of its stake in Alibaba Group Holding Ltd. (NYSE:BABA) and its entire stake in two other companies: Celgene Corp. (NASDAQ:CELG) and Boston Scientific Corp. (NYSE:BSX). With the proceeds from these trades, the firm initiated positions in eBay Inc. (NASDAQ:EBAY), IQVIA Holdings Inc. (NYSE:IQV) and Comcast Corp. (NASDAQ:CMCSA).

Alibaba

Tiger Management sold 166,900 shares of Alibaba for an average price of $179.21 per share. With this transaction, the firm trimmed 5.21% of its portfolio.

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Alibaba’s profitability ranks 9 out of 10, driven by expanding profit margins and strong returns on equity. The company’s operating margin of 30.70% outperforms 98% of global competitors.

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Chris Davis (Trades, Portfolio) increased his Alibaba position sixfold as the company offers good growth potential for the current year, including an expected year-over-year revenue growth rate of 56%, according to a previous article.

Celgene

Tiger Management sold its 219,540-share position in Celgene for an average price of $113.03 per share. The firm pared 5.79% of its portfolio with this transaction.

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Celgene, a New Jersey-based biotech company, develops and commercializes therapies designed to treat cancer and various immune-inflammatory related diseases. The company’s profitability ranks 9 out of 10, driven primarily by expanding operating margins, a strong Piotroski F-score of 8 and solid returns on capital based on Joel Greenblatt (Trades, Portfolio)’s definition.

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CEO Mark Alles said Celgene’s operating momentum enables it to “continue expanding [the company’s] portfolio,” highlighted by the announced transactions with Impact Biomedicines Inc. and Juno Therapeutics Inc. (NASDAQ:JUNO).

Boston Scientific

Tiger Management sold its 1,069,500 shares of Boston Scientific for an average price of $27.60. The firm trimmed 5.64% of its portfolio with this transaction.

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Massachusetts-based Boston Scientific manufactures various medical devices and markets them to health-care professionals and institutions around the globe. Although the company has a strong Piotroski F-score, Boston Scientific’s financial strength ranks 4 out of 10 primarily due to a high debt-to-EBITDA ratio of 3.29. Additionally, the company’s interest coverage ranks lower than 82% of global competitors.

Portfolio impact from firm’s top 3 buys partially offset portfolio impact from firm’s top 3 sells

Tiger Management’s top three sells reduced the portfolio 16.64% in the aggregate, higher than the combined portfolio impact from the firm’s top three buys:

  • The firm invested in 683,200 shares of eBay for an average price of $37.16 per share, stretching the portfolio 4.03%.
  • Tiger Management invested in 261,100 shares of IQVIA Holdings for an average per-share price of $101.80, adding 3.99% to the portfolio.
  • The firm invested in 597,500 shares of Comcast for an average price of $37.59 per share, increasing the portfolio 3.74%.

The above three buys increase the portfolio 11.76% in the aggregate, approximately 4.88% lower than the combined portfolio impact from the top three sells.

See also

You can view Tiger Management’s latest trades here. We also track the latest guru trades through the “Latest Guru Picks” page.

Disclosure: I do not have positions in the stocks mentioned.

About the author:

James Li
I am an editorial assistant and researcher at GuruFocus. I have a Master's in Finance from SMU, and I enjoy writing reports on financial trends and investor portfolios. Follow me on Twitter at @JamesLiGuru!

Visit James Li's Website


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