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I wrote about being bullish on Ford (F) in the middle of July. Shares are down 20% since then and are even more attractive now. I ended up initiating a position recently and now have a cost basis of about $12. You can get the stock even cheaper now. 13F filings came out recently and we now have a better picture of how some large investors traded in Q2. Ford shares were essentially flat during the second quarter, but have had a rough go of it since the end of Q2. Here is how some smart investors played the stock:

Ken Heebner runs Capital Growth Management and has more than $6 billion under management. His long-term performance record is tremendous. Heebner initiated a new position in Ford in Q2 by buying 16.7 million shares. He previously had cut his entire 41.6 million position in the stock in Q1. Ford is his second biggest position right now after National Oilwell Varco (NOV).

Also buying was investing legend Mario Gabelli. Gabelli owns 1.9 million shares and has been ramping up his ownership since Q4 2009. Ford isn’t one of his largest holdings right now. His top two holdings are Cablevision (CVC) and DIRECTV (DTV).

On the other side of the trade are four savvy investors as well. Richard Perry completely sold out of his Ford position in Q2. Perry sold all 900,000 shares he owns after buying them all in Q1. Perry is a hedge fund manager and runs Perry Capital. While he no longer owns Ford, he does have a large position in General Motors (GM). GM makes up about 5% of his portfolio.

Ron Baron joined Perry by selling out of his Ford stake entirely. Perry had first bought into the stock in Q3 2010, and had increased his position each quarter until dumping it all last quarter. That turned out to have been a smart move. Baron’s largest position as of the end of Q2 was in Factset Research (FDS).

Jeremy Grantham didn’t sell out of his Ford holdings completely, but he’s been trimming it for the last four quarters. His holdings are down to less than 385,000 shares. If you’ve followed Grantham at all, you know he’s been critical of Washington and the Fed and is very concerned about the economy going forward. It shouldn’t be surprising, then, that his largest holdings are cash-rich companies. He likes Johnson & Johnson (JNJ), Microsoft (MSFT), and Oracle (ORCL).

Ford shares make up about 1.3% of Leon Cooperman’s portfolio. Cooperman trimmed his holdings in Q2 by about 500,000 shares and he now owns 4.2 million. Like Richard Perry, Cooperman also has a sizable position in GM. In fact, GM makes up about 2.7% of his portfolio, substantially more than his Ford stake. Cooperman came out yesterday and blamed much of the recent volatility on high frequency trading. He would like to see both high frequency trading and credit default swaps banned. I agree on both counts. High frequency trading is a form of front-running, and credit default swaps are like naked shorts. Neither add anything to productive economic activity, and each cause tremendous harm.

Disclosure: I am long F, MSFT.

Source: How Some Smart Investors Are Playing Ford