David Einhorn’s words carry so much weight in the financial world that when he spoke out against Green Mountain Coffee Roasters (GMCR) at the Value Investing Congress on October 17, shares in GMCR fell immediately, as did shares in companies that had a similar profile, like Sodastream (SODA).
David Einhorn’s Top Holdings
As of the end of the third quarter, Einhorn’s hedge fund Greenlight Capital had a 13F portfolio of $4.7 billion, spread across 39 stocks. His top holdings included Apple (AAPL), which accounts for 10.7% of his portfolio after he increased Greenlight’s position in the company by 21.92% in the third quarter. Einhorn’s second largest position at the end of September was Market Vectors Gold Miners ETF Trust (GDX). Einhorn upped his stake in GDX by 104.82% in the third quarter, bringing his position to a value worth 8.6% of his portfolio.
Microsoft (MSFT) was next, taking up 8.1% of the Greenlight portfolio value after Einhorn increased his position in the company by 2.37%. CareFusion Corp (CFN) was Einhorn’s fourth largest position, coming in at 6.6% of his total portfolio value after he upped Greenlight’s stake in the company by 34.38%. Einhorn’s fifth largest holding as of September 30, was also one of the largest purchases he made in the third quarter. Einhorn had increased his stake in General Motors (GM) by 330.79% in the third quarter.
New Positions for David Einhorn
David Einhorn initiated several new positions in the third quarter, and added to several of his existing positions. Einhorn initiated a position of 16,640,000 shares in Marvell Technology Group Ltd. (MRVL). He also opened a position with CBS (CBS) of 5,000,000 shares. Einhorn bought into Legg Mason Inc (LM) during the third quarter as well. He had 2,600,000 shares in the company at the end of the third quarter.
Einhorn also bought into two new gold positions – Barrick Gold Corp. (ABX) and Market Vectors Junior Gold Miners Etf (GDXJ). He bought 1,350,000 shares and 1,900,000 shares respectively. Einhorn was also bullish on Compuware Corp. (CPWR) in the third quarter, buying 4,459,027 shares in the company. Einhorn initiated a new position in Synaptics Inc. (SYNA) as well.
Einhorn Increased His Position in Several Companies
David Einhorn was bullish on several of the stocks in his portfolio, adding to several significantly during the third quarter. Einhorn increased positions in Apple, Market Vectors Gold Miners ETF Trust, CareFusion Corp, Microsoft and General Motors, as discussed previously, but he also upped the ante on several others. This includes Sprint Nextel (S), HCA Holdings (HCA), Seagate Technology (STX), Huntington Ingalls Industries (HII), Encsco Plc (ESV), Aspen Insurance Holdings (AHL), Marathon Oil Corp (MRO), NCR Corp (NCR) and Travelers Cos Inc. (TRV).
David Einhorn’s Bearish Moves
David Einhorn is not a bearish investor; in contrast, he is an activist investor. Earlier this year he gave a speech at the Ira Sohn Conference and asked for the resignation of Microsoft’s Steve Ballmer. He selects stocks based on how much value he sees in the company, and whether or not the current management is maximizing that value or not. Then, he buys a stake that is large enough to give him a say in the company’s operations and works on building value from the inside out. So, while he not a “bearish” investor, Einhorn can certainly be bearish about specific companies.
This was very clear in the third quarter as Einhorn sold out or reduced several large positions. Specifically, Einhorn sold out of his position in Pfizer. His sale prices ranged from $16.66 to $20.78, for an average estimated sale price of $18.73. PFE recently traded at $19.59. He also sold out of his positions in BP Plc (BP), Aeropostale (ARO) and Amdocs (DOX), while cutting his positions in Becton Dickinson & Co. (BDX) by almost 34% and Employers Holdings (EIG) by roughly 32%.
Disclosure: I am long MSFT.