Leading funds such as Fidelity Investments, Wellington Management, and Loomis Sayles & Co. filed forms 13-D and 13-G with the SEC on Monday, December 12th, indicating that they had amended their ownership in U.S. traded public companies. The forms are required to be filed within ten days, so the institutions traded these shares sometime between the last week of November and Monday. The following are the most notable filings from Monday (for more info on Forms 13-D and 13-G, and how to interpret that, please refer to the end of this article):
Arena Pharmaceuticals (ARNA): ARNA is a biotech developer of oral drugs for cardiovascular, central nervous system, inflammatory, and metabolic diseases. On Monday, Boston-based Wellington Management, with over $634 billion in assets under management, filed SEC Form SC 13G/A indicating that they now hold 9.1 million or 6.3% of outstanding shares of ARNA, a decrease of 2.1 million shares from the 11.2 million shares that it reported holding in the 13-F filing for Q3. Even after this sell, Wellington is still the largest institutional holder in ARNA, with Vanguard Group being the next largest with 4.7% of the outstanding shares. ARNA shares have rallied strongly recently, up more than a double since the last week of November when the stock started rallying on positive comments from Piper Jaffray regarding its upcoming NDA re-submission to the FDA for lorcaserin.
Micron Technology (MU): MU is a leading manufacturer of semiconductor memory solution, including DRAM, NAND and NOR flash memory, phase change memory, and image sensors. These memory products are used in a range of electronic applications, including personal computers, workstations, network servers, mobile phones, flash memory cards, USB storage devices, digital still cameras, MP3/4 players, and in automotive applications.
On Monday, Boston-based Fidelity Investments, with over $1.5 trillion in assets under management, filed SEC Form 13G/A indicating that it now held 93.3 million or 9.4% of outstanding shares of MU, a decrease of 29.4 million shares from the 112.7 million shares that it reported holding in the 13-F filing for Q3. Even after this sell, Fidelity is still by far the largest institutional holder of MU, with Vanguard Group being the next largest with 4.9% of the outstanding shares. MU is trading near its lows, down 27.4% year-to-date, as revenues and earnings have been down year-over-year, and the stock trades at 34 P/E on a TTM basis versus the 11.2 average for the semiconductor memory group.
Transocean Ltd. (RIG): RIG provides offshore contract drilling for oil and gas wells worldwide. On Monday, Boston-based Fidelity Investments, with over $1.5 trillion in assets under management, filed SEC Form 13G/A indicating that it now held 11.1 million shares or 3.5% of outstanding shares of RIG, a decrease of 15.3 million shares from the 26.4 million shares that it reported holding in its 13-F filing for Q3. RIG has been extremely weak recently, and its shares trade near six-year lows, down by about 40% so far in 2011, as its quarterly operating results have continued to disappoint investors. Its shares trade at 12 forward P/E and 0.7 P/B, compared to averages of 12.2 and 1.4 respectively for the oil & gas drilling group.
Diamond Foods Inc. (DMND): DMND manufactures culinary, ingredient, food service and in-shell nuts and other snack products. On Monday, Boston-based Wellington Management, with over $634 billion in assets under management, filed SEC Form SC 13G/A indicating that it now holds 3.0 million or 13.6% of outstanding shares of DMND, an increase of 2.7 million shares from the 0.3 million shares that it reported holding in the 13-F filing for Q3. With this buy, Wellington is now the largest institutional holder of DMND shares, surpassing Fidelity Investments that reported holding 13.3% of outstanding shares in its 13-F filing for Q3. DMND shares have been weak recently and trade at their lows, plagued by questions over the company’s accounting practices and the mystery surrounding the recent suicide death of a director that may or may not be related to the accounting investigation. DMND shares are cheap, trading at a discount 9 forward P/E compared to the 41.5 average for its peers in the miscellaneous & diversified food group.
Human Genome Sciences (HGSI): HGSIdevelops gene-based protein and antibody drugs to treat cancer and immunological and infectious diseases. Its principal products in development include BENLYSTA for systemic lupus erythematosus; and raxibacumab for inhalation anthrax. On Monday, Boston-based Loomis Sayles & Co. with $142 billion in assets under management, filed SEC Form SC 13G indicating that it now holds 32.0 million or 13.9% of outstanding shares, a new position for them since the end of the September quarter. HGSI stock has been weak lately, down 69% year-to-date, with the latest drop after the company reported disappointing numbers for Q3 on October 25th, followed by the announcement of an offering of $400 million in Convertible Notes the next week on November 2nd. We believe that the long-term blockbuster potential of BENLYSTA, its drug for lupus, remains unchanged, and that its shares are attractively priced at these levels.
Ciena Corp. (CIEN): CIEN is a designer of Ethernet transport and switching systems used in network infrastructure by telecom and cable service providers. On Monday, Boston-based Loomis Sayles & Co. with $142 billion in assets under management, filed SEC Form SC 13G/A indicating that it now holds 17.6 million or 15.4% of outstanding shares, a new position for them since the end of the September quarter. The buy makes Loomis Sayles the largest institutional holder of CIEN shares. CIEN shares trade at a discount 11-12 forward P/E compared to the 12.4 average for its peers in the fiber-optics group, while earnings are projected to rise strongly from 25c loss in 2010 to 60c profits in 2012 to $1.03 in 2012.
Transatlantic Petroleum (TAT): TAT is engaged in crude oil and natural gas exploration and production in Turkey, Morocco, Bulgaria and Romania. On Monday, Boston-based Fidelity Investments, with over $1.5 trillion in assets under management, filed SEC Form 13G/A indicating that it now held 3.2 million or 0.9% of outstanding shares of TAT, a decrease of 2.6 million shares from the 5.8 million shares that it reported holding in the 13-F filing for Q3. TAT shares are currently trading at their lows, down 64% year-to-date, as recent quarter operating results have continued to be disappointing.
On top of these, some additional 5% ownership SEC Form 13-D and 13-G filings on major stocks on Monday include the ones filed by Fidelity Investments indicated that it amended its ownership in passenger airline operator Jetblue Airways Corp. (JBLU), semiconductor manufacturer Triquint Semiconductor (TQNT), Irish drug developer Amarin Corp. Plc (AMRN), tire manufacturer Goodyear Tire & Rubber (GT), semiconductor designer PMC Sierra Inc. (PMCS), and oil refiner and marketer CVR Energy Inc. (CVI); and Wellington’s filing on professional social networking platform operator LinkedIn Corp. (LNKD).
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
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