Tracking Stephen Mandel's Lone Pine Capital Portfolio - Q4 2015 Update

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Includes: ADBE, ADSK, AGN, AMZN, ANET, ATVI, AXP, BCS, BUD, CHTR, CSX, DEO, DLTR, DVA, EA, ENDP, EQIX, ESRX, EXPE, FB, FLT, FNF, GOOG, GOOGL, GRA, HBI, HDB, HZNP, ILMN, JD, KSU, LNG, LULU, MA, MBLY, MHK, MSFT, NKE, NOC, PCLN, PXD, RLGY, SBAC, SCHW, SHLD, STZ, TAP, TDG, ULTA, V, VMC, VRX, WBA, WMB
by: John Vincent

Summary

Stephen Mandel’s 13F portfolio decreased from $24.55B to $23.40B. The number of positions remained steady at 47.

Lone Pine Capital increased Dollar Tree while dropping Allergan plc.

The top-three individual stocks are Microsoft, Amazon, & Priceline and they add up to ~17 % of the portfolio.

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

This quarter, Mandel's US long portfolio decreased 4.70% from $24.55B to $23.40B. The number of holdings remained steady at 47. The top three individual stock positions are at 17.39% while the top five are at 26.12% of the US long assets: Microsoft Corporation, Amazon.com, Priceline Inc., Facebook Inc., and Dollar Tree.

Mandel worked at Tiger Management under Julian Robertson for eight years starting in the late 1980s, making him a bona fide tiger cub. To know more about Julian Robertson and his legendary Tiger Management, check out Julian Robertson: A Tiger in the Land of Bulls and Bears.

Stake Disposals:

Allergan plc (NYSE:AGN) previously Actavis plc: AGN was a 2.89% of the US long portfolio position as of last quarter. The position was established in Q1 2015 at prices between $255 and $317 and increased by ~25% the following quarter at prices between $283 and $313. Last quarter also saw a ~14% further increase at prices between $252 and $340. The entire stake was sold this quarter at prices between $253 and $323. The stock currently trades at $285.

DaVita Healthcare (NYSE:DVA): The original DVA stake was purchased in Q4 2014 and Q1 2015 at prices between $73 and $82. Last quarter saw a ~45% increase at prices between $71 and $81. The elimination this quarter happened at prices between $68 and $78. The stock currently trades at $64.85.

SBA Communications (NASDAQ:SBAC): SBAC was a 1.20% position. The stake was from Q4 2013 and Q1 2014 at prices between $77 and $97. Q2 2015 saw a ~29% reduction at prices between $112 and $124 and that was followed with a ~39% reduction last quarter at prices between $104 and $128. The remaining position was sold out this quarter at prices between $100 and $121. The stock currently trades at $93.02.

Charles Schwab (NYSE:SCHW), Endo International plc (NASDAQ:ENDP), Expedia Inc. (NASDAQ:EXPE), Kansas City Southern (NYSE:KSU), Mobileye NV (NYSE:MBLY), Realogy Holdings (NYSE:RLGY), and W R Grace (NYSE:GRA): These very small (less than ~1.5% of the portfolio each) positions were sold out this quarter.

New Stakes:

Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL) previously Google: The medium sized 2.68% of the portfolio stake in GOOG was established this quarter at prices between $608 and $777. The stock currently trades at $707.

Anheuser Busch Inbev (NYSE:BUD), Autodesk Inc. (NASDAQ:ADSK), Express Scripts (NASDAQ:ESRX), Lululemon Athletica (NASDAQ:LULU), Northrop Grumman (NYSE:NOC), and Pioneer Natural Resources (NYSE:PXD): These are very small (less than ~1.5% of the portfolio each) stakes established this quarter. Autodesk had seen a recent roundtrip - a ~1% stake was established in Q3 2014 and eliminated in Q2 2015.

Note: Lone Pine Capital controls 2.5% of ADSK and 5% of LULU.

Stake Decreases:

Adobe Systems (NASDAQ:ADBE): ADBE is a 1.61% of the US long portfolio position. It was first purchased in Q1 2014 and almost doubled the following quarter at prices between $60 and $73. Q2 2015 saw a ~23% reduction at prices between $73 and $84 and that was followed with a one-third reduction last quarter at prices between $74 and $87. This quarter saw another ~35% reduction at prices between $80.65 and $95.56. The stock currently trades at $83.80.

Charter Communications (NASDAQ:CHTR) & Calls: The 3.70% position was first purchased in Q3 2014 at prices between $152 and $164 and the following quarters also saw minor buying. Q2 2015 saw a whopping ~150% increase at prices between $168 and $193. This quarter saw an about turn: ~50% reduction at prices between $175 and $193. The stock is currently at $177.

Note: Lone Pine Capital controls 4.2% of CHTR.

Electronic Arts (NASDAQ:EA): EA is a 1.89% of the portfolio position established in Q2 2015 and increased by just over 10-times last quarter at prices between $63 and $75. This quarter saw a ~27% reduction at prices between $65 and $77. The stock currently trades at $63.27.

Equinix Inc. (NASDAQ:EQIX): EQIX is a medium-sized 2.73% portfolio stake. It is a long-term position first purchased in 2010. Around 4M shares were acquired at the time at a cost-basis in the low-80s. The position size has wavered since although by Q4 2014, the stake was back at ~4M shares. Q1 2015 saw a ~30% reduction at prices between $217 and $239. This quarter saw another ~20% reduction at prices between $265 and $305. The stock is now at $300. Lone Pine is harvesting gains from the position.

Note: Lone Pine Capital controls 3.4% of Equinix.

Facebook Inc. (NASDAQ:FB): The current top-five 4.38% FB stake was purchased in Q3 2014 at prices between $66.34 and $78.79. Q2 2015 saw a ~20% increase at prices between $77.46 and $88.86 and that was followed with a ~10% increase last quarter at prices between $82 and $98. The stock currently trades at $107. This quarter saw a ~9% trimming.

Note: FB has seen a previous presence in the portfolio. Around 11M shares were purchased in Q4 2012 at prices between $19 and $29. The stake was disposed of in 2013 and early 2014 at much higher prices, realizing huge gains.

JD.com Inc. (NASDAQ:JD): JD is a 3.72% of the portfolio position purchased in Q4 2014 and Q1 2015 at prices between $23 and $30. This quarter saw a ~38% reduction at prices between $25.52 and $32.65. The stock is now at $26.32.

MasterCard Inc. (NYSE:MA): The 2.56% MA stake was established in Q3 2013 at prices between $59 and $69 and increased by ~30% the following quarter at prices between $67 and $83. Q1 2014 saw some selling but the following three quarters saw a huge ~200% increase at prices between $69 and $89. 2015 saw a combined ~70% reduction at prices between $82 and $102. The stock is currently at $87.80.

Priceline Inc. (NASDAQ:PCLN): PCLN is a large (top three) 4.55% long-term stake first purchased in 2011 at a cost-basis of ~$500. The original position was sold down by ~44% in Q3 2013 at prices between $900 and $1030 and another two-thirds in Q1 2014 at prices between $1132 and $1358. There was a combined ~380% increase over the next three quarters at prices between $1064 and $1280. 2015 saw a combined ~40% reduction at prices between $1008 and $1454. The stock is now at $1288. Lone Pine is harvesting gains from this position.

Valeant Pharmaceuticals (NYSE:VRX): VRX was the second-largest 13F stake at 5.42% of the US long portfolio as of last quarter. It was first purchased in 2013. Last quarter saw a ~40% increase at prices between $158 and $263. This quarter saw an about turn: ~22% reduction at prices between $70 and $182. The stock is now at $75.91 and the stake is at 2.53% of the portfolio.

Barclays Bank plc (NYSE:BCS) Puts, CSX Corporation (NYSE:CSX) & Calls, Fidelity National Financial (NYSE:FNF) & Calls, Mohawk Industries (NYSE:MHK), Proshares Ultra VIX Short Term Puts, TransDigm Group (NYSE:TDG), and Vulcan Materials (NYSE:VMC): These small positions (less than ~2% of the portfolio each) saw reductions this quarter.

Note: Lone Pine Capital controls ~4.1% of TransDigm Group.

Stake Increases:

Amazon.com Inc. (NASDAQ:AMZN): AMZN is a top-three 6.38% of the portfolio position purchased last quarter at prices between $430 and $548 and increased by ~14% this quarter at prices between $512 and $694. The stock is now at $560.

Cheniere Energy (NYSEMKT:LNG): LNG is a 2% of the portfolio position first purchased in Q3 2014 at prices between $70 and $84. The following quarter saw a ~28% increase at prices between $64.88 and $77.33. There was another ~54% increase last quarter at prices between $47.47 and $70.65. The stock is now at $30.38. For investors attempting to follow Lone Pine Capital, LNG is a good option to consider for further research. This quarter saw a marginal increase.

Note: Lone Pine Capital controls 5.3% of the business. LNG is very popular among super investors: Seth Klarman (Baupost Group), Carl Icahn, and John Griffin (Blue Ridge Capital) have large stakes.

Dollar Tree (NASDAQ:DLTR): DLTR is a fairly large 4.35% of the portfolio position. It was established last quarter at prices between $65 and $82 and increased by ~156% this quarter at prices between $61 and $80. The stock currently trades at $81.67.

Note: Lone Pine Capital controls 5.6% of the DLTR.

Microsoft Corporation (NASDAQ:MSFT): MSFT is the largest 13F position at 6.46% of the portfolio. Around 27M shares were purchased in Q4 2013 at prices between $34 and $38. Q4 2014 saw a huge ~75% reduction at prices between $43 and $50. The position was built back up to ~29.4M shares over the first two quarters of 2015 at prices between $40.40 and $47.59. Last quarter saw a ~11% trimming while this quarter saw a ~4% increase. The stock currently trades at $52.65.

Constellation Brands (NYSE:STZ): STZ is a medium-sized 3.26% stake established last quarter at prices between $115 and $131 and increased by ~14% this quarter at prices between $125 and $145. The stock is now at $141.

Nike Inc. (NYSE:NKE): The 3.07% NKE stake was purchased in Q1 2015 at prices between $46 and $55 and decreased by ~20% last quarter at prices between $52 and $63. The stake was doubled this quarter at prices between $61 and $68. It is now at $60.15.

Note: The prices quoted above are adjusted for the 2-for-1 stock split in November 2015.

Ulta Salon (NASDAQ:ULTA): ULTA is a 2.83% stake first purchased in 2012 at much lower prices. Last quarter saw a ~40% increase at prices between $153 and $173. Mandel is sitting on huge gains and is very bullish. The stock is now at $156. This quarter saw a ~9% further increase.

Note: Lone Pine Capital controls 5.6% of Ulta Salon.

Visa Inc. (NYSE:V): V is a fairly large 4.23% stake purchased in Q4 2014 and Q1 2015 at prices between $51 and $68 and increased by ~31% this quarter at prices between $70 and $80. The stock currently trades at $73.02.

Williams Companies (NYSE:WMB) & Calls: The 3.18% WMB position was established in Q1 2015 at prices between $40.94 and $60.86. The stake saw a ~64% increase this quarter at prices between $21.54 and $43.83. The stock currently trades well below those ranges at $16.14.

Note: Lone Pine controls 3.9% of WMB.

Activision Blizzard (NASDAQ:ATVI), American Express (NYSE:AXP) & Calls, Diageo plc (NYSE:DEO), Hanesbrands Inc. (NYSE:HBI), HDFC Bank (NYSE:HDB), and Molson Coors Brewers (NYSE:TAP): These are very small (less than ~2% of the portfolio each) stakes increased this quarter.

Kept Steady:

FleetCor Technologies (NYSE:FLT): The 3.93% FLT stake is from 2013 - Mandel is sitting on large gains on this position. Last quarter saw a ~17% further increase at prices between $138 and $164. It currently trades at $130.

Note: Lone Pine Capital controls 7% of FleetCor Technologies.

Illumina Inc. (NASDAQ:ILMN): ILMN is a medium-sized 2.96% of the US long portfolio stake. It was purchased in Q1 2015 at prices between $181 and $203 and almost doubled the following quarter at prices between $182 and $221. Last quarter saw a ~36% reduction at prices between $168 and $240. The stock currently trades at $153.

Walgreens Boots Alliance (NASDAQ:WBA) & Calls: The 2.47% WBA position was first purchased in Q4 2014. Q2 2015 saw a stake doubling at prices between $83 and $89 and that was followed with a roughly one-third increase last quarter at prices between $81 and $97. The stock is now at $78.80. For investors attempting to follow Mandel, WBA is a good option to consider for further research.

Arista Networks (NYSE:ANET), Horizon Pharma plc (NASDAQ:HZNP), and Sears Holdings (NASDAQ:SHLD) Puts: These are very small (less than ~1.5% of the portfolio each) positions that were kept steady this quarter.

Note: Lone Pine Capital controls 9.8% of HZNP.

The spreadsheet below highlights changes to Mandel's US stock holdings in Q4 2015:

Click to enlarge

Disclosure: I am/we are long LNG, SHLD.

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.