This article is part of a series that provides an ongoing analysis of the changes made to Glenn Greenberg's US stock portfolio on a quarterly basis. It is based on Greenberg's regulatory 13F Form filed on 05/15/2014. Please visit our Tracking Glenn Greenberg's Brave Warrior Advisors Portfolio series to get an idea of his investment philosophy and our previous update highlighting the fund's moves during Q4 2013.
This quarter, Greenberg's US long portfolio increased marginally from $2.44B to $2.47B. The top three holdings represent over 53% of the portfolio while the top-five exceeds 72% of the value of the entire portfolio. The largest holding is Valeant Pharmaceuticals (NYSE:VRX) which has been in the portfolio since Q1 2011 and now accounts for a whopping 29.80% of the portfolio.Stake Disposals:
Higher One Holdings Inc. (NYSE:ONE): ONE has been in the portfolio since Q1 2012. The original position was a 6.5M share stake established at prices between $15 and $18. The stake was reduced by 27% in Q3 2013 at prices between $7 and $11.64. Last quarter saw another 50% cut at prices between $7.46 and $10.46. This quarter, the remaining 0.92% of the portfolio position was eliminated at prices between $6.55 and $9.76. The stock currently trades at $4.15. It was a timely disposal as the stock has fallen ~43% since the end of the quarter following a disclosure that the Federal Reserve System is seeking an administrative order against Higher One. The company also warned that the penalties that could ensue might trigger a loan default.New Stakes:
Comcast Corporation (NASDAQ:CMCSA) (CMCSK): Comcast was a 3.77% of the US long portfolio stake as of last quarter. It was almost eliminated this quarter at prices between $49.10 and $55.24. The stock currently trades at $50.19. The original position consisted of a huge $1.4B activist stake built in the 2005-2006 timeframe (under Chieftain Capital Management). The activism revolved around calls to replace Comcast CEO Brian Roberts over management missteps and failure to increase shareholder value. That plan did not succeed but they were instrumental in the company initiating a 25c annual dividend in early 2008. The position was marginally increased in Q2 2013 but was decreased slightly in Q3 2013. Last quarter saw a ~32% stake reduction at prices between $44.33 and $52. Greenberg harvested huge gains from this position after a holding period of over eight years.
Charles Schwab Corporation (NYSE:SCHW): SCHW was a 4.67% of the US long portfolio stake established in Q3 2012 at prices between $12.50 and $14.50. It had since been built up to an 8.74% stake as of Q3 2013. Last two quarters saw a combined ~22% stake reduction at prices between $20.57 and $28.53. The stock currently trades at $25. Greenberg is harvesting substantial gains from this position.
Valeant Pharmaceuticals : VRX is Greenberg's largest position at 29.80% of the US long portfolio. Last quarter saw a ~7% stake reduction at prices between $103 and $118 and this quarter saw another ~8.5% stake reduction at prices between $112 and $148. The original position consisted of ~2.4M shares purchased in Q1 2011 at prices between $28.50 and $53.25 and the current position stands at ~5.6M shares. The stock currently trades at around $127.
VistaPrint N V (VPRT): VPRT is a 6.32% of the US long portfolio stake. The position was reduced by one-third in Q3 2013 at prices between $48 and $57. Last quarter saw an additional 18% stake reduction at prices between $51.92 and $57.66. This quarter also saw minor selling. The stock currently trades at $40. The original stake consisted of ~2M shares purchased in Q4 2011 at prices between $27 and $36. The position currently stands at 3.18M shares. Greenberg is continuing to harvest gains from the position.
Express Scripts Holding (NASDAQ:ESRX): ESRX is a 10.76% of the US long portfolio stake that was first purchased in Q4 2012 at prices between $50 and $65. The position was more than doubled in Q1 2013 at prices between $53.30 and $59. Q3 2013 saw an about-turn as the position was reduced by ~20% at prices between $61 and $68. Last quarter the pattern reversed as there was a ~17% stake increase at prices between $60.88 and $70.60. This quarter saw a ~10% stake reduction at prices between $69.84 and $78.64. The stock currently trades at $68.72.
Halliburton (NYSE:HAL): HAL is a 9.70% of the US long portfolio stake that was increased by roughly two times in Q2 2013 at prices between $37 and $45.50. The position was further increased by ~7% in Q3 2013 at prices between $41.72 and $50.50. The original stake was established in Q1 2013 at prices between $34.50 and $43.50. This quarter saw a reversal as ~14% of the position was eliminated at prices between $48 and $59.46. The stock currently trades at $62.85.
Primerica Inc. (NYSE:PRI): PRI is a 6.43% of the US long portfolio position first established in Q3 2011. The original stake consisted of ~1.3M shares and has since been built-up over the ensuing quarters to a ~3.4M share position. This quarter saw a marginal stake reduction. The stock currently trades at $43.45.Stake Increases:
Oracle Corporation (NASDAQ:ORCL): ORCL was a small 2.14% position established in Q4 2011 at prices between $22.50 and $33.75. The stake has since been built-up over the following quarters to a large 12.90% position. It is currently Greenberg's second-largest position, after Valeant Pharmaceuticals. In Q2 2013, the position was increased by ~25% at prices between $30 and $35.10 and Q3 2013 saw a further ~15% stake increase at prices between $30 and $34. Last quarter saw a minor stake increase while this quarter saw an additional ~10% increase at prices between $35.84 and $40.91. The stock currently trades at $41.69. The aggressive stake build-up indicates a clear bullish bias.
Microsoft Corporation (NASDAQ:MSFT): MSFT is a 6.60% of the US long portfolio position established in Q3 2013 at prices between $31 and $36.50. Last quarter saw a minor stake increase at prices between $33 and $39 and this quarter saw additional minor buying. The stock currently trades at $39.83. The activity indicates a mild bullish bias.
Kinder Morgan Management LLC (NYSE:KMR): KMR is a 5.64% of the US long portfolio position purchased last quarter at prices between $72.32 and $78.34. It was increased by 79% this quarter at prices between $69.54 and $77.21. The stock currently trades at $72.34. The substantial stake build-up indicates a clear bullish bias. For investors attempting to follow Greenberg, KMR is a good option to consider.Kept Steady:
Other very small positions (less than 0.5% of the US long portfolio each) in the portfolio include Bank of America (NYSE:BAC) and Tidewater Inc. (NYSE:TDW). The spreadsheet below highlights changes to Greenberg's US stock holdings in Q1 2014:
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.