By Eric Winter
Louis Navellier and his team of investment professionals manage assets that stretch into the billions of dollars within his firm, Navellier & Associates. The fund, founded in 1980, is required by the SEC to release its holdings every quarter in a document known as a 13F filing. We look forward to the release of these filings, as we research them to create retail-friendly strategies that we've used to beat the market in real-time. Our small-cap strategy has returned over 38% between September 2012, and April 2013 (see more here). See below for our take on the five largest, new, non-ETF positions initiated by Navellier in the first quarter of 2013 (the original 13F filing is here).
LinkedIn Corp. (LNKD) ranks at the top of the list, receiving an allocation of $57mm as reported in the fund's Q1 13F. The professional social network is riding high this year, already up 63.5% and garnering sell-side support from the likes of Wunderlich Securities, Jefferies, and most recently, National Alliance Capital. The latter set a price target of $192 for LNKD in mid-April, which the stock blew past less than two weeks later. LinkedIn continues to beef up its tech offerings with a revamp of its Recruiter product and a recent purchase of mobile news reader app Pulse. Billionaire Steven Cohen of SAC Capital Advisors carries almost 330,000 shares of the stock (read about his fund's top stocks here).
American Electric Power Company (AEP) was a $48.5mm investment for Navellier, amounting to almost 1mm shares purchased. In contrast to LNKD, AEP has fallen out of favor with Wall Street, with SunTrust Robinson Humphrey, Wells Fargo, and Morgan Stanley all adjusting their viewpoints negatively since the start of the year. AEP reported Q1 earnings on the 26th of April, delivering a slight beat in revenue but falling short (by a penny) in terms of EPS. In addition to the stock's 30% gain since this time last year, income investors should take note of the newly-increased dividend, coming in at a yield of 3.9%. Billionaire Israel Englander of Millennium Management bests Navellier's position size by 81,000 shares.
PulteGroup, Inc. (PHM) takes the number three spot with nearly $45mm devoted to the homebuilder. The stock has more than doubled in value for those who bought in this time last year, registering a gain of 112%. PHM reported earnings on the 25th of this month, showing a beat helped along by average selling prices up 10% and home closings up 23% year over year. Looking towards the future, PulteGroup increased its authorized land and related development investment by $200mm, up from $1.2bn to $1.4bn. Billionaire Ken Griffin of Citadel Investment Group has a call position that exceeds 500,000 shares.
The Clorox Company (CLX) grabbed $43.7mm of the fund's AUM in the first quarter of 2013. The stock has moved up almost linearly since the turn of the year, racking up a gain of 18%. CLX reported Q1 earnings on the first of May, disappointing analysts and investors with a miss on both EPS and revenue. The stock had another reason to falter, as guidance for 2013 came in below consensus as well. The company still pays a dividend yield of 2.9%, however, and has a number of new product innovations in its pipeline. D. E. Shaw dropped its equity position in CLX in the last quarter of 2012 but opted to keep its put and call positions steady.
ResMed Inc. (RMD) brings up the bottom of our screen, receiving nearly $41mm from Navellier and his investment professionals. The medical equipment manufacturer focuses primarily on sleep- and respiratory-disorder treatment. Goldman Sachs saw fit to add the stock to its Conviction List after RMD beat analyst estimates for FQ3 earnings in late April. Both net income and revenue increased year over year (31% and 10%, respectively), as outlined in the announcement. Billionaire Paul Tudor Jones of Tudor Investment Corp keeps 10,800 shares of RMD on hand.