Tracking George Soros's Portfolio - Q4 2015 Update

|
Includes: AAL, ABEO, AGN, AGRO, ALLE, ALLY, AMZN, BABA, BUD, CACQ, CHDN, CHTR, CIT, CPGX, CTRP, CVX, CY, CZR, DAL, DD, DISH, DOW, EBAY, EGN, ENDP, EQT, ESNT, EXA, EXAR, FB, FCAU, FXI, GE, GLPI, GM, GOOG, GOOGL, HERO, HYG, IWM, LGF, LILA, LILAK, LORL, LSCC, LUV, LVLT, LYB, MCD, MDLZ, MODN, MON, MPC, MSCC, MSI, MXL, NEE, NRG, PFE, PLCM, PMCS, PYPL, QQQ, QUNR, ROVI, SCHW, SLB, SPY, SWKS, SYF, TVPT, VIAV, VIPS, WBMD, WNR, WUBA, XOP, YPF, YUM, ZTS
by: John Vincent

Summary

Soros' 13F portfolio decreased from $6.61B to $6.05B this quarter. The number of positions increased from 232 to 244.

A fairly large new position in Synchrony Financial was established during the quarter while reducing stakes in several businesses with exposure to Chinese economy.

Adecoagro SA, Dow Chemical, and Synchrony Financial are the largest three individual stock positions.

This article is part of a series that provides an ongoing analysis of the changes made to George Soros's US stock portfolio on a quarterly basis. It is based on George Soros's regulatory 13F Form filed on 02/16/2016. Please visit our Tracking Soros Fund Management Holdings article for an idea on his investment philosophy and our previous update highlighting the fund's moves during Q3 2015.

Soros Fund Management invests globally and the long positions in the US market reported in the 13F filings represent ~15% of the overall portfolio. The 13F portfolio decreased ~9% this quarter from $6.61B to $6.05B. The number of positions increased from 232 to 244. Very small stock positions and large debt holdings together account for over 28% of the 13F holdings. The US long investments are diversified with a large number of very small equity positions, a small number of large equity positions, and a few large debt holdings. As the small positions (<0.5%) do not indicate a clear bias, the focus of this article is on the larger positions. The top-three individual stock positions are Adecoagro SA, Dow Chemical, and Synchrony Financial.

To learn about Soros' distinct trading style and philosophy, check out his "The Alchemy of Finance" and other works.

New stakes:

Synchrony Financial (NYSE:SYF): SYF is a large (top-three) 3.58% of the US long portfolio stake established this quarter at prices between $29.51 and $34. The stock currently trades below that range at $26.62. The spinoff of General Electric's (NYSE:GE) credit arm started trading in August 2014 and has returned ~16% since.

Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL), Columbia Pipeline Group (NYSE:CPGX), Ferrari NV, iShares iBoxx High Yield (NYSEARCA:HYG), Marathon Petroleum (NYSE:MPC), Pfizer Inc. (NYSE:PFE), and Powershares QQQ (NASDAQ:QQQ) Puts: These are small (less than ~1% of the portfolio each) positions established this quarter. Google is a good trading stock for Soros and it has seen numerous successful roundtrips. Ferrari NV is a Fiat Chrysler (NYSE:FCAU) spinoff that started trading last month.

Stake Disposals:

General Motors (NYSE:GM) & Calls: GM & Calls were a minutely small position in Q3 2013. It was increased to a fairly significant 2.19% position in Q4 2013 at prices between $34 and $42. In Q1 2014, the stake was reduced by ~46% at prices between $34 and $41. The following quarters saw a combined ~65% increase at prices between $32.62 and $38.87. In Q2 2015, the stake was sold down by ~80% at prices between $33.23 and $37.50. Last quarter, the pattern reversed again: around two-thirds increase at prices between $27.28 and $33.33. The elimination this quarter was at prices between $30 and $36.46. The stock currently trades at $29.02.

iShares China Large Cap (NYSEARCA:FXI) Calls: The small stake established in Q2 2015 at prices between $44.40 and $52.71 was more than doubled last quarter as the stock traded between $33.58 and $46.10. The position was eliminated this quarter as the underlying traded between $34.53 and $40.37. FXI is currently at $30.47.

Note: FXI had seen another recent roundtrip: It was a fairly large 2.29% of the portfolio stake entered between $37.46 and $41.98 and exited in Q1 2015 between $40.77 and $44.74.

Vipshop Holdings (NYSE:VIPS): VIPS was a 1.49% of the US long portfolio position as of last quarter. The bulk was purchased in Q1 2014 at around $10 cost-basis. The stake saw a ~25% increase in Q2 2015 at prices between $21.54 and $30 and another ~24% last quarter at prices between $15.85 and $23.11. The disposal this quarter was at prices between $12.50 and $21.81. The stock currently trades at $12.16.

Chevron Corporation (NYSE:CVX), CTrip.com (NASDAQ:CTRP), Lattice Semiconductor (NASDAQ:LSCC), Monsanto (NYSE:MON), NextEra Energy Inc. (NYSE:NEE), NRG Energy (NYSE:NRG), PMC-Sierra (NASDAQ:PMCS), Schlumberger Ltd. (NYSE:SLB), Charles Schwab (NYSE:SCHW), Southwest Airlines (NYSE:LUV), and Western Refining (NYSE:WNR): These are very small (less than ~1% of the portfolio each) stakes eliminated this quarter.

Note: Microsemi Corporation's (NASDAQ:MSCC) acquisition of PMC-Sierra closed last month. Microsemi and Skyworks Solutions (NASDAQ:SWKS) were in a bidding war for PMC-Sierra. Soros controlled ~5.6% of PMC-Sierra.

Stake Increases:

Delta Air Lines (NYSE:DAL): DAL has seen several successful roundtrips in the portfolio. The majority of the current 1.66% stake was established over the last two quarters at prices between $40 and $52. The stock currently trades at $46.48.

DISH Network (NASDAQ:DISH) & Calls: DISH was a minute 0.20% of the US long portfolio position as of Q1 2013. In Q2 2013, the stake was increased substantially to a 1.83% position at prices between $36 and $42.50. The position was sold down since. The stake is now at 1.23% and the stock is at $43.17. This quarter saw a marginal increase.

EQT Corporation (NYSE:EQT): The original position in EQT was established in Q2 2012 at prices between $44 and $54.07. In Q3 2014, there was a ~19% increase at prices between $91 and $107 and the following quarter saw an additional 44% increase at prices between $75.38 and $99.75. Q1 2015 saw a ~37% reduction at prices between $72.53 and $83.43 and the following quarter saw a further ~58% reduction at prices between $81 and $92. Last quarter, the remaining 0.58% portfolio stake was almost sold out at prices between $64.77 and $81.34. The pattern reversed this quarter: ~14x increase to a 1.25% stake at prices between $47.75 and $76.50. The stock currently trades at $60.92.

Endo International plc (NASDAQ:ENDP): ENDP is a fairly large 2.19% of the portfolio position established in Q4 2014 at prices between $60.19 and $73.37 and increased by ~27% the following quarter at prices between $71.97 and $92.37. Last quarter saw a ~12% reduction while this quarter saw a ~7% increase. The stock currently trades at $51.03. For investors attempting to follow Soros, ENDP is a good option to consider for further research.

Level 3 Communications (NYSE:LVLT): Most of the original LVLT stake was purchased in Q2 & Q3 2014 at prices between $36.37 and $47.50. Q4 2014 saw a ~28% reduction at prices between $38.05 and $50 and the following quarter saw a further ~11% reduction at prices between $47.02 and $55.46. Q2 2015 saw further selling: ~40% reduction at prices between $52 and $57. This quarter saw a ~60% increase at prices between $43 and $55. The stock is now at $48.37 and the stake is fairly large at 2.87%.

LyondellBasell Industries (NYSE:LYB): LYB is a 1.25% of the US long portfolio stake. The position saw a ~380% increase this quarter at prices between $83 and $98 and the stock is now below that range at $80.20. The original stake was established in Q4 2014 at prices between $70.61 and $109 and reduced by ~27% the following quarter at prices between $74.36 and $91.55. Q2 2015 saw a further ~15% reduction at prices between $87.80 and $106. Last quarter, the remaining 1.72% of the portfolio position was almost eliminated at prices between $77 and $104.

S&P 500 SPDR (NYSEARCA:SPY) Calls & Puts: The SPY position has wavered over the years. Recent activity follows: In Q1 2015 the Puts were a large ~11% portfolio stake. The following quarter saw a reversal: The Puts stake was reduced while adding a huge position in the Calls. Last quarter saw a reduction in both the positions. The net was a very small ~1.46% position in the Puts. This quarter, the calls were sold while the puts were increased to a 3.39% stake.

Note: The activity in SPY on its own does not indicate a clear bias as Soros is known to use this ETF to hedge other parts of his portfolio.

Amazon.com (NASDAQ:AMZN), Anheuser Busch Inbev (NYSE:BUD), Caesars Acquisition (NASDAQ:CACQ), 58.com ADR (NYSE:WUBA), iShares Russell 2000 ETF (NYSEARCA:IWM) Puts, Liberty Global Lilac (NASDAQ:LILA) (NASDAQ:LILAK), Loral Space & Communications (NASDAQ:LORL), McDonald's (NYSE:MCD), and S&P SPDR Oil & Gas ETF (NYSEARCA:XOP): These are small (less than ~1% of the portfolio each) stakes increased this quarter. Soros controls 5.03% of LORL.

Stake Decreases:

Allergan plc (NYSE:AGN) previously Actavis plc: AGN was Soros' second-largest individual stock position at 3.18% of the 13F portfolio as of last quarter. This quarter saw a ~46% reduction to a 2.76% portfolio stake at prices between $253 and $323. The original position was doubled in Q4 2014 at prices between $225 and $271 and reduced by around two-thirds in Q2 2015 at prices between $283 and $313. Last quarter had seen a huge ~390% increase at prices between $252 and $340. The stock currently trades at $278.

Note: In November 2015, Pfizer Inc. announced the acquisition of Allergan plc in a deal valued at $160B. Allergan shareholders will receive 11.3 shares of a new company (the new business will be domiciled in Ireland - tax inversion deal structure) for each share held. The deal is expected to close in H2 2016.

American Airlines (NASDAQ:AAL): The original very small position was increased by over 150% in Q2 2014 at prices between $33.37 and $44.55. It was built-up to a 1.83% of the 13F portfolio stake by Q3 2014 at prices between $35 and $44. Q4 2014 saw an about-turn as the position was reduced by ~53% at prices between $28.58 and $53.63. The pattern continued the following quarter with a ~53% reduction at prices between $46.53 and $55.76 and another ~19% reduction in Q2 2015 at prices between $39.48 and $52.78. Last quarter, the pattern reversed again: ~50% increase at prices between $37.50 and $44. The stock currently trades at $39.54. This quarter saw a marginal reduction.

CIT Group Inc. (NYSE:CIT): CIT is a 0.92% of the US long portfolio stake. It was purchased last quarter at prices between $39.61 and $48.51 and decreased by ~50% this quarter at prices between $39.70 and $46.14. The stock currently trades at $28.77.

Cypress Semiconductor (NASDAQ:CY) & Calls: CY is a 2.66% of the portfolio position. The original stake saw a ~400% increase in Q1 2015 and another ~19% increase in Q2 2015. Last quarter also saw a ~18% increase at prices between $8.28 and $12.15. The stock currently trades at $7.33. The stake is fairly large at 2.66% of the portfolio.

Note 1: A regulatory 13G/A filing on 02/16/2016 shows the CY stake as eliminated.

Note 2: The vast majority of the 400% increase in Q1 2015 was due to the acquisition of Spansion by Cypress that closed in March 2015 - Spansion shareholders received Cypress stock in the ratio 1:2.457. Soros had a 3.55M share position in Spansion.

Dow Chemical (NYSE:DOW): DOW was a very small 0.32% position as of Q2 2014. In Q3 2014, the position was increased by just over 150% to a 1.14% stake at prices between $51 and $54.80 and the following quarter saw a further 78% increase at prices between $42.71 and $52.84. Last quarter saw a ~23% increase at prices between $39.39 and $53.04. There was a ~25% reduction this quarter at prices between $42.40 and $56.97. It is still a top-three stake at 3.82% of the US long portfolio. The stock currently trades at $47.57.

Note: Dan Loeb (Third Point) established a huge activist stake in Dow Chemical in Q4 2013 at around the mid-40s price-range. In December 2015, Dow and DuPont (NYSE:DD) announced a merger of equals with plans to separate into three businesses after the merger.

eBay Inc. (NASDAQ:EBAY): EBAY is a 1.56% portfolio stake. The bulk of the buying happened in Q1 2015 and last quarter at prices between $22.32 and $28.75. This quarter saw a ~36% reduction at prices between $24 and $29.59. The stock currently trades at $23.53.

Note: the prices quoted above are adjusted for the spinoff of PayPal from eBay.

Energen Corporation (NYSE:EGN): EGN has been in the portfolio since Q1 2013. Q4 2013 saw a ~50% increase at prices between $66 and $85. Q1 2015 saw an about turn: ~37% reduction at prices between $59.05 and $70.54 and the remaining position was almost sold out in Q2 2015 at prices between $66 and $76. Last quarter saw a huge ~470% increase at prices between $44.17 and $68.30. The pattern reversed again this quarter: ~85% reduction at prices between $40.45 and $61.57. The stock is now at $25.53.

Essent Group (NYSE:ESNT): Soros had a stake in Essent Group prior to its October 2013 IPO at ~$22.50 per share. Q4 2013 regulatory filings showed him owning ~7.5M shares. Since Q4 2014, the stake has seen consistent selling and it is now at ~1.5M shares (0.54%). The selling was at prices between $21 and $29. The stock currently trades at $18.26.

Facebook Inc. (NASDAQ:FB): FB was a minutely small ~0.10% portfolio stake as of Q1 2015. It was increased to a fairly large 2.07% of the portfolio position in Q2 2015 at prices between $77.46 and $88.86. Last quarter saw a ~30% reduction at prices between $82.09 and $98.39 and that was followed with a ~55% reduction this quarter at prices between $90 and $109. The stock currently trades at $104 and the stake is at 1.41% of the portfolio.

Note: FB had a previous presence in the portfolio: Around ~1.8M shares were purchased in Q2 2014 at prices between $56 and $65. Most of it was disposed of the following quarter at prices between $66 and $79.

PayPal Holdings (NASDAQ:PYPL): PYPL is a 1.77% of the portfolio position established last quarter as a result of the spinoff of PayPal from eBay. eBay holders received one share of PayPal for each share held. This quarter saw a one-third reduction at prices between $31 and $38. PYPL currently trades at $36.31.

Polycom Inc. (NASDAQ:PLCM): The bulk of the 1.84% PLCM stake is from Q4 2013 and Q1 2014 at a cost-basis of around $11.50. This quarter saw a ~18% reduction at prices between $10.42 and $14.04. The stock currently trades at $9.54. Soros has a 6.39% ownership stake in the business.

Time Warner Cable (NYSE:TWC): TWC is a ~1.22% of the US long portfolio position. It was established in Q2 2015 at prices between $149 and $184 and reduced by ~50% last quarter at prices between $174 and $193. This quarter saw another ~43% reduction at prices between $179 and $192. The stock currently trades at $188.

Note: Charter Communications (NASDAQ:CHTR) is set to acquire TWC in a $195 cash-and-stock deal ($100 cash).

YPF SA (NYSE:YPF): YPF was a fairly large 2.33% of the US long portfolio stake as of last quarter. The position was almost sold out this quarter at prices between $15 and $22. The original stake was a small 0.87% stake established in Q3 2013 at prices between $14.80 and $21.57. It had since been consistently bought every quarter thru Q3 2014 at prices between $20 and $36. Q4 2014 saw a ~13% reduction at prices between $22.50 and $37. Last two quarters had also seen a combined ~14% reduction at prices between $14.91 and $31.57. The stock currently trades at $17.41.

Zoetis (NYSE:ZTS): ZTS is a 2.68% of the US long portfolio stake. The bulk of the position is from Q4 2013 and Q1 2014 when the position was increased by ~160% at an average price of ~$32. Q2 2015 saw a one-third reduction at prices between $44 and $55 while last quarter saw a ~28% increase at prices between $39.65 and $50.02. The stock currently trades at $42.02. This quarter saw minor trimming.

Note: There is recent activist involvement in ZTS. Bill Ackman has built a ~41.82M share (~8.5% of business) stake and has acquired a board seat.

Allegion PLC (NYSE:ALLE), Ally Financial (NYSE:ALLY), Lions Gate Entertainment (NYSE:LGF) & Calls, Mondelez Intl. (NASDAQ:MDLZ), Motorola Solutions Inc. (NYSE:MSI), Qunar Cayman (NASDAQ:QUNR), Rovi Corporation (NASDAQ:ROVI), and Viavi Solutions (NASDAQ:VIAV): These are very small (less than ~1% of the US long portfolio each) positions reduced this quarter.

Kept Steady:

Adecoagro S A (NYSE:AGRO): AGRO is the largest individual stock position at 5.27% of the US long portfolio. It was established prior to its IPO. The stock currently trades at around $13.04, compared to the IPO price of $11.

Alibaba Group (NYSE:BABA): BABA was Soros' largest 13F individual stock position at ~3.64% as of Q1 2015. It was established in Q3 2014 at prices between $87 and $94. In Q2 2015, the position was almost sold out at prices between $79.54 and $93.88. Last quarter, the pattern reversed again: significant increase to a ~0.9% portfolio stake at prices between $57.39 and $84.15. The stock currently trades at $66.51.

Broadcom Corporation (BRCM), Caesars Entertainment (NASDAQ:CZR), Churchill Downs (NASDAQ:CHDN), Gaming & Leisure Properties (NASDAQ:GLPI), Kraft-Heinz (HNZ),Travelport Worldwide (NYSE:TVPT), and Yum Brands (NYSE:YUM): These very small (less than ~1% of the portfolio each) positions were kept steady during the quarter.

Although the relative sizes are very small, it is significant that Soros has ownership stakes in the following businesses: 5.66% of Model N (NYSE:MODN), 2.8% of MaxLinear (NYSE:MXL), 3.8% of Exar Corporation (NYSE:EXAR), 9.78% of EXA Corp. (NASDAQ:EXA), 5.19% of Abeona Therapeutics (NASDAQ:ABEO), 3.98% of WebMD (NASDAQ:WBMD) in convertible notes, 8.18% of Penn Virginia (PVAH), and 7.02% of Hercules Offshore (NASDAQ:HERO).

The spreadsheet below highlights Soros's significant US long stock positions as of Q4 2015:

Click to enlarge

Disclosure: I am/we are long DOW, EBAY, PYPL, GM.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.