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Summary

  • Glenn Greenberg’s US long portfolio increased marginally from $2.47B to $2.48B this quarter.
  • Brave Warrior Advisors increased positions in Express Scripts & Charles Schwab, while almost eliminating Halliburton.
  • Valeant Pharmaceuticals continues to be their largest holding by far at 30.78% of the US long portfolio.

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 08/14/2014. 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 Q1 2014.

This quarter, Greenberg's US long portfolio increased marginally from $2.47B to $2.48B. The top three holdings represent almost 57% of the portfolio, while the top-five is at two-thirds 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 30.78% of the portfolio.

Stake Disposals:

None.

New Stakes:

Equinix Inc. (NASDAQ:EQIX): EQIX is a medium-sized 4.32% of the US long portfolio position established this quarter at prices between $170 and $210. The stock currently trades outside that range at $217. The substantial stake establishment indicates a clear bullish bias.

Stake Decreases:

Halliburton (NYSE:HAL): HAL was a 9.70% of the US long portfolio stake as of last quarter. It was almost eliminated this quarter at prices between $57 and $71. The stock currently trades at $68.42. The original position was established in Q1 2013 at prices between $34.50 and $43.50 and was increased by roughly two times in Q2 2013 at prices between $37 and $45.50. Last quarter saw a reversal as ~14% of the position was eliminated at prices between $48 and $59.46. The activity indicates a clear bearish bias.

Kinder Morgan Management LLC (NYSE:KMR): KMR is a 9.03% of the US long portfolio position purchased in Q4 2013 at prices between $72.32 and $78.34. It was increased by 79% last quarter at prices between $69.54 and $77.21. This quarter saw a 13% stake reduction at prices between $71 and $79. The stock currently trades at $101. On August 10, 2014, it was announced that Kinder Morgan will consolidate its publicly traded units under one roof: Kinder Morgan Energy Partners LP (NYSE:KMP), Kinder Morgan Inc. (NYSE:KMI), Kinder Morgan Management, and El Paso Pipeline Partners (NYSE:EPB) to be combined under KMI.

Primerica Inc. (NYSE:PRI): PRI is a 6.48% 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. Last two quarters have seen marginal stake reductions. The stock currently trades at $47.91.

Stake Increases:

Express Scripts Holding (NASDAQ:ESRX): ESRX is a 13.08% 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. In Q4 2013, the pattern reversed as there was a ~17% stake increase at prices between $60.88 and $70.60. Last quarter saw a ~10% stake reduction at prices between $69.84 and $78.64. The zigzag buy/sell activity continued this quarter with a 32% stake increase at prices between $66 and $76. The stock currently trades at $73.04. All told, ESRX has become Greenberg's second-largest position.

Microsoft Corporation (NASDAQ:MSFT): MSFT is an 8.14% of the US long portfolio position established in Q3 2013 at prices between $31 and $36.50. Q4 2013 saw a minor stake increase at prices between $33 and $39 and last quarter saw additional minor buying. This quarter, the position was increased by 20% at prices between $39 and $42.25. The stock currently trades at $44.79. The activity indicates a bullish bias.

Oracle Corporation (NYSE: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 third-largest position, after Valeant Pharmaceuticals and Express Scripts. 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 an additional ~10% increase at prices between $35.84 and $40.91 while this quarter saw a marginal increase. The stock currently trades at $40.28. The aggressive stake build-up indicates a clear bullish bias.

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. Q4 2013 and Q1 2014 saw a combined ~22% stake reduction at prices between $20.57 and $28.53. This quarter, the pattern reversed as the position was increased by 16% at prices between $24.80 and $27.45. The stock currently trades at $27.27.

Valeant Pharmaceuticals: VRX is Greenberg's largest position at 30.78% of the US long portfolio. Q4 2013 saw a ~7% stake reduction at prices between $103 and $118 and last quarter saw another ~8.5% stake reduction at prices between $112 and $148. This quarter, the pattern reversed with a 9% increase at prices between $117 and $138. 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 ~6M shares. The stock currently trades at around $112.26.

Vistaprint (NASDAQ:VPRT): VPRT is a 5.92% of the US long portfolio stake. The position was reduced by one-third in Q3 2013 at prices between $48 and $57. Q4 2013 saw an additional 18% stake reduction at prices between $51.92 and $57.66. This quarter saw a reversal as the position was increased by 14% at prices between $39.49 and $53.42. The stock currently trades at $47.28. The original stake consisted of ~2M shares purchased in Q4 2011 at prices between $27 and $36. The position currently stands at 3.6M shares.

Kept Steady:

None.

Other very small positions (less than 0.5% of the US long portfolio each) in the portfolio include Bank of America (NYSE:BAC), Comcast Corporation (NASDAQ:CMCSA) (NASDAQ:CMCSK), and Tidewater Inc. (NYSE:TDW).

The spreadsheet below highlights changes to Greenberg's US stock holdings in Q2 2014:

(click to enlarge)

Source: Tracking Glenn Greenberg's Brave Warrior Advisors Portfolio - Q2 2014 Update