Leading hedge and mutual fund companies such as Fidelity, Wellington, Fairholme, T Rowe Price and Capital Research Global Investors filed forms 13-G with the SEC last week, indicating that they had amended their ownership in U.S. traded public companies. Form 13-D is commonly referred to as “beneficial ownership report,” and is required when a person or a group of persons acquires beneficial ownership of more than 5% of the voting class of a company’s equity securities; form 13-G is the abbreviated version of the form that is allowed under certain circumstances.
The information in forms 13-D and 13-G is extremely timely as it is required to be filed within ten days after the purchase, in contrast to 13-F quarterly filings by Institutions that are filed every three months. The information contained in 13-F filings, thereby, can be as much as eighteen weeks old by the time it is disseminated to the public. Furthermore, by virtue of their 5% ownership in public companies, the information contained in the 13-D and 13-G filings indicates only high confidence or high conviction moves by institutions and insiders, and hence can be interpreted to be of greater relevance to the investment community than the 13-F quarterly filings. Furthermore, 13-D and 13-G filings often are a precursor to hostile takeover, company breakups and other “change of control” events, and often they will include a letter to management explaining the reason for their taking a large stake in the company. The following are some of the major 13-D and 13-G filings by leading institutions and insiders during the week ending October 14, that can aid in identifying trading opportunities:
Anadys Pharmaceuticals (ANDS): ANDS is a biopharmaceutical company, engaged in developing novel medicines for the treatment of hepatitis C in the U.S. Boston-based Wellington Management Co. LLP, with over $670 billion in assets under management, filed Form SC-13G with the SEC on Tuesday, October 11, indicating that it now holds 1.6 million shares or less than 5% of ANDS, a decrease from the 5.0 million or 8.8% of AMD shares that it held at the end of the June quarter. Just today, ANDS announced that it would be acquired at a 250% premium by Roche Holding Ltd. (OTCQX:RHHBY) at $3.70 per share.
Advanced Micro Devices (AMD): AMD is the second largest producer of microprocessors, GPUs and chipsets in the world, behind market leader Intel Corp. (INTC). It provides microprocessors for server platforms, including multi-core processors; it also provides embedded processor products for vendors in industrial controls, digital signage, point of sale, medical imaging, set-top box and casino gaming machines, as well as enterprise class telecommunications, networking, security, storage systems and thin-clients, or computers; and it provides integrated graphics processor chipsets and discrete chipsets for desktop and notebook PCs, professional workstations, and servers. Minneapolis-based Ameriprise Financial Inc., with over $130 billion in assets under management, filed Form SC 13G on Tuesday, October 11, indicating that it now holds 69.3 million shares or 10.0% of AMD stock. This is an increase from the 51.4 million shares they held at the end of the June quarter. Ameriprise has been building a position in AMD as it held 41 million shares at the end of the March quarter. We recommended a sell on AMD in our coverage on July 25, when the stock traded in the $7.80s, and the stock has fallen 40% since then.
Applied Materials (AMAT): AMAT provides manufacturing equipment, services, and software to the semiconductor, flat panel display, solar photovoltaic (PV), and related industries worldwide. Boston-based Fidelity Investments, with $1.5 trillion in assets under management, filed Form SC-13G on Tuesday, October 11, indicating that it now holds 38.3 million shares or 2.9% of AMAT, a decrease from the 82.2 million or 6.2% of AMAT shares that it held at the end of the June quarter.
Regions Financial Corp. (RF): RF is a holding company for the Regions Bank that provides a range of commercial, retail, and mortgage banking services in the U.S. Miami-based Fairholme Capital Management LLC, headed by hedge fund guru Bruce Berkowitz, and with more than $10 billion in equity assets under management, filed Form SC-13G, on Tuesday, October 11, indicating that it now holds 60.6 million shares or 4.8% of RF, a decrease from the 123.9 million or 9.8% of RF shares that it held at the end of the June quarter.
Cel-sci Corp. (CVM): CVM is a developer of immunotherapeutic agents and peptides to treat cancer and bacterial, viral and parasitic infections. Its lead product, Multikine, is under phase 3 clinical trial for the treatment of head and neck cancer. Illinois-based healthcare-focused hedge fund Cranshire Capital filed SC-13G, on Thursday, October 13, indicating that it now holds 13.5 million shares or 5.9% of CVM.
Peabody Energy Corp. (BTU): BTU is engaged in coal production and sale through 28 operations in the U.S. and Australia. Baltimore, MD-based T Rowe Price, with over $280 billion in assets under management, filed Form SC 13G on Tuesday, October 11, indicating that it now holds 28.2 million shares or 10.4% of BTU stock. This is an increase from the 23.0 million shares they held at the end of the June quarter; T Rowe Price has been building a position in BTU as they held 20.5 million shares at the end of the March quarter.
Ciena Corp. (CIEN): CIEN is a designer of Ethernet transport and switching systems used in network infrastructure by telecom and cable service providers. Boston-based Fidelity Investments, with $1.5 trillion in assets under management, filed Form SC-13G on Tuesday, October 11, indicating that it now holds 5.5 million shares or 5.6% of CIEN, a decrease from the 9.4 million or 9.7% of CIEN shares that it held at the end of the June quarter. Besides Fidelity, Soros Fund Management has also been active in CIEN, and it filed SC-13G last month, indicating that it owned 5.1 million shares or 5.0% of CIEN stock, an increase from the 10,600 shares it owned at the end of the June quarter.
Staples Inc. (SPLS): SPLS is an office products company that sells various office supplies and services, business machines, computers, and office furniture. It also provides high-speed, color and self-service copying, other printing services, faxing, and pack and ship services. Los Angeles-based Capital Research Global Investors, one of the world’s largest investment management companies with assets of around $1 trillion, filed SC-13G, on Tuesday, October 11, indicating that it now holds 35.9 million shares or 5.1% of SPLS, a decrease from the 55.8 million or 7.9% of SPLS shares that it held at the end of the June quarter. Capital Research has been selling SPLS in recent quarters, as it held 72.9 million shares at the end of the March quarter.
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