Lee Ainslie met Julian Robertson when Robertson was managing $700 million with seven other analysts. He joined Robertson and spent three years at Tiger. Like many other Tiger cubs, Ainslie left Tiger and launched his own hedge fund, Maverick Capital, later in October 1993. Since inception, Maverick has outperformed the S&P 500 index on average by around 6-7 percentage points annually, with 50% less volatility, which leads us to think that he has nearly 10% annual alpha (though we do not have his monthly returns to calculate his actual alpha).
In this article, we are going to focus on the stocks that Ainslie sold out over the third quarter. Maverick Capital had at least $8 million in each position at the end of June, but the fund sold out its stakes during the third quarter.
Company Name | Ticker | Value |
BLACKROCK INC | 274688 | |
BANCO SANTANDER BRASIL | 267923 | |
ITAU UNIBANCO HLDNG | 244616 | |
GOODRICH CORP | 196646 | |
TEXAS INSTRUMENTS INC | 140798 | |
WELLPOINT INC | 140397 | |
GILEAD SCIENCES INC | 135756 | |
SOLARWINDS INC | 107675 | |
YAHOO INC | 87475 | |
BERRY PETROLEUM CO | 57541 | |
THORATEC CORP | 54519 | |
EATON CORP | 51338 | |
ARCOS DORADOS HOLDINGS | 46520 | |
SOUFUN HOLDINGS LTD | 10980 | |
HISOFT TECHNOLOGY INTL | HSFT | 9510 |
KIRKLANDS INC | 8400 |
The largest position that Ainslie sold out during the third quarter is BlackRock Inc (BLK), an asset management firm. At the end of June, Maverick Capital reported to own $275 million of BLK shares. At the end of the third quarter, the fund did not disclose owning any shares of BLK. The stock returned 21.39% since the end of September, versus 11.62% for SPY over the same period. Paul Tudor Jones, Louis Bacon, Andreas Halvorsen, James Dinan, and Israel Englander all sold out their stakes in BLK during the third quarter.
Another large-cap stock that Ainslie is no longer bullish about is Texas Instruments Inc (TXN). Maverick Capital sold out all $141 million worth of TXN stocks during the third quarter. The stock returned 9.85% since the end of September, underperforming the market by nearly 2 percentage points. Louis Bacon’s Moore Global Investments also sold out its TXN position over the third quarter.
Yahoo Inc (YHOO) is another technology stock that Ainslie sold out in the third quarter. Maverick Capital had had $87 million invested in YHOO at the end of the second quarter. Since the end of September, YHOO returned 22.48%. The stock has a market cap of $20.01B and a P/E ratio of 19.67. Bill Miller’s Legg Mason Capital Management, David Tepper’s Appaloosa Management, Whitney Tilson’s T2 Partners, and Rob Citrone’s Discovery Capital Management all sold out their stakes in YHOO during the third quarter.
Ainslie is also no longer in favor of Gilead Sciences Inc (GILD), WellPoint Inc (WLP), Goodrick Corp (GR), or Eaton Corporation (ETN). Ainslie has a strong track record. Over the past 10 years, his Maverick Capital only underperformed the market 3 times. We recommend investors to be careful about initiating new positions in these stocks.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
