Tracking Stephen Mandel's Lone Pine Capital Portfolio - Q1 2018 Update

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Includes: ADBE, AMZN, ATVI, AVGO, BABA, BKNG, BLK, BUD, CHTR, CRM, CSX, DLTR, EA, EQIX, FB, GOOG, IQV, MA, MELI, MSFT, NOW, PYPL, SBAC, STZ, TDG, TRU, TSM, TV, UNH, WYNN
by: John Vincent

Summary

Stephen Mandel's 13F portfolio value increased ~3% from $19.16B to $19.74B. The number of positions decreased from 31 to 30.

Lone Pine Capital increased Facebook while dropping Anheuser-Busch InBev during the quarter.

The top three positions are Facebook, Adobe Systems, and Constellation Brands, and they add up to ~18% of the portfolio.

This article is part of a series that provides an ongoing analysis of the changes made to Stephen Mandel's 13F portfolio on a quarterly basis. It is based on Mandel's regulatory 13F Form filed on 05/15/2018. 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 Q4 2017.

This quarter, Mandel's 13F portfolio value increased ~3% from $19.16B to $19.74B. The number of holdings decreased from 31 to 30. The top three positions are at ~18% while the top five are at ~29% of the 13F assets: Facebook (NASDAQ:FB), Adobe Systems (NASDAQ:ADBE), Constellation Brands (NYSE:STZ), Microsoft (NASDAQ:MSFT), and Alibaba Group Holding Ltd. (NYSE:BABA).

Stephen 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.

New Stakes:

Dollar Tree (NASDAQ:DLTR), SBA Communications (NASDAQ:SBAC), and Taiwan Semi (NYSE:TSM): These are medium-sized new positions established this quarter. The ~3% DLTR stake was purchased at prices between $89 and $116 and the stock currently trades at $94.65. SBAC is a ~3% portfolio position established at prices between $153 and $175 and the stock is now at $157. The 2.74% TSM stake was purchased at prices between $40 and $46 and it is currently just below that range at $39.27.

T-Mobile US (NASDAQ:TMUS), Square Inc. (NYSE:SQ), PagSeguro Digital (NYSE:PAGS), and Exact Sciences (NASDAQ:EXAS): These are very small (less than ~1% of the portfolio each) new positions established this quarter.

Stake Disposals:

Anheuser-Busch InBev (NYSE:BUD): BUD was a very small stake purchased in Q3 2017 and built up to a ~3% portfolio position last quarter at prices between $110 and $126. The stake was disposed this quarter at prices between $103 and $115. The stock is now at $95.75.

Charter Communications (NASDAQ:CHTR) & Calls: The ~3% CHTR position was first purchased in Q3 2014 at prices between $152 and $164. Q2 2015 saw a whopping ~150% increase at prices between $168 and $193. Q4 2015 saw an about turn: ~50% reduction at prices between $175 and $193. There was a ~60% selling last quarter at prices between $316 and $371 and the elimination this quarter was at prices between $304 and $388. The stock is currently at $268. Mandel harvested huge gains.

Equinix Inc. (NASDAQ:EQIX): EQIX was a 2.66% portfolio stake as of last quarter. It was a long-term position first purchased in 2010. The stake had wavered. There was a ~25% further selling in Q1 2017 at prices between $359 and $400 and the disposal this quarter was at prices between $382 and $458. The stock is now at ~$387. Mandel harvested huge long-term gains.

Grupo Televisa (NYSE:TV): The ~2% TV position was established in Q3 2016 at prices between $24 and $28. There was a ~36% increase in Q1 2017 at prices between $20 and $27. The position was disposed this quarter at prices between $14.50 and $21 and it is now at $17.77.

Mastercard Inc. (NYSE:MA): MA was a 2.66% of the portfolio stake established in Q2 2017 at prices between $111 and $126. There was a ~25% reduction last quarter at prices between $141 and $154 and the disposal this quarter was at prices between $152 and $183. The stock currently trades at $192.

Note: MA has seen a previous roundtrip: a ~2% 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. The last three quarters of 2014 saw a huge ~200% increase at prices between $69 and $89. 2015 saw a combined ~70% reduction at prices between $82 and $102. Q1 2016 saw a ~18% further reduction at prices between $80.50 and $97.50 and the disposal in Q3 2016 was at prices between $87 and $102.

Salesforce.com (NYSE:CRM): The 2.60% CRM position was purchased in Q2 2017 at prices between $82 and $98 and reduced by ~22% last quarter at prices between $93 and $109. The stake was eliminated this quarter at prices between $103 and $128. The stock currently trades at $129.

Agilent Technologies (NYSE:A) and iPath S&P 500 VIX ETN (NYSEARCA:VXX): These are very small (less than ~1% of the portfolio each) stakes disposed this quarter.

Stake Decreases:

Adobe Systems: ADBE is a large (top three) 6.18% of the 13F portfolio position. It was first purchased in Q1 2014 and almost doubled the following quarter at prices between $60 and $73. 2015 saw that original stake reduced by two-thirds at prices between $73 and $96. Q1 2016 saw an about turn: ~26% increase at prices between $74 and $94. The stock currently trades at ~$245. There was a ~20% reduction in Q2 2017 at prices between $129 and $145. Last quarter saw an about turn: ~50% increase at prices between $148 and $185. There was minor trimming this quarter.

Constellation Brands: STZ is a top-three 5.60% stake established in Q3 2015 at prices between $115 and $131. The following three quarters had seen a combined ~40% increase at prices between $125 and $164. Q3 2016 saw an about turn: ~17% sold at prices between $161 and $168. The next two quarters saw a one-third increase at prices between $145 and $171. The stock is now at ~$217. There was a roughly one-third reduction last quarter at prices between $199 and $229. This quarter saw marginal trimming.

Alibaba Group Holding: The large (top five) 5.56% BABA stake was established in Q3 2016 at prices between $78.50 and $110 and increased by ~50% the following quarter at prices between $86.50 and $108. There was another ~30% increase in Q1 2017 at prices between $88.50 and $110. Q2 2017 also saw a ~18% increase at prices between $107 and $144. There was a ~25% reduction next quarter at prices between $141 and $180 and that was followed with a similar reduction last quarter at prices between $169 and $191. The stock is now at $197. There was a ~6% trimming this quarter. Mandel is harvesting gains.

Booking Holdings (NASDAQ:BKNG): BKNG is a large 5.35% portfolio position established in Q3 2017 at prices between $1790 and $2049 and increased by roughly one-third last quarter at prices between $1646 and $1942. The stock currently trades at $2088. There was a ~8% trimming this quarter.

Activision Blizzard (NASDAQ:ATVI): The large ~5% ATVI position was purchased in Q2 2016 at prices between $33 and $39 and built over the next three quarters at prices between $35.50 and $50. The stock is now at $70.80. There was a ~41% reduction over the last four quarters at prices between $48 and $78.

Note: ATVI had a previous round-trip: a ~2% position was established in H2 2015 and disposed in Q1 2016.

Electronic Arts (NASDAQ:EA): The 4.38% EA position was purchased in Q3 2017 at prices between $105 and $122 and increased by ~75% last quarter at prices between $101 and $120. It is now above those ranges at ~$131. There was a marginal reduction this quarter.

Amazon.com (NASDAQ:AMZN): AMZN is a fairly large ~4% of the portfolio stake established last quarter at prices between $957 and $1,196. The stock is now well above that range at $1,603. There was a ~25% selling this quarter at prices between $1,189 and $1,598.

BlackRock Inc. (NYSE:BLK): The ~2.5% BLK stake was established last quarter at prices between $447 and $519 and it currently goes for ~$541. This quarter saw a ~17% selling at prices between $509 and $593.

ServiceNow Inc. (NYSE:NOW): NOW is a 2.24% stake established in Q2 2017 at prices between $84.50 and $118. Last quarter saw a ~22% reduction at prices between $113 and $131. There was another one-third reduction this quarter at prices between $132 and $175. It now goes for $176.

Stake Increases:

Facebook Inc.: The 6.23% FB stake is currently the largest position. It was purchased in Q3 2014 at prices between $66 and $79. Q1 2015 saw the original stake reduced by ~40% at prices between $74 and $84. There was a ~45% selling in Q3 2016 at prices between $114 and $131. The position had wavered since. This quarter saw a~75% stake increase at prices between $152 and $193. The stock is now at $186.

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.

Microsoft Corporation: MSFT is a large (top five) 5.58% portfolio stake established in Q2 2017 at prices between $65 and $72.50. The stock is now at $98.31. There was a ~15% trimming last quarter at prices between $74 and $87 while this quarter saw a ~26% stake increase at prices between $85 and $97.

Note: MSFT has had a previous round-trip: It was a large (top five) 4.93% of the portfolio position in Q4 2016. The bulk of the position was from H1 2015 at prices between $40 and $48. The five quarters through Q3 2016 had seen a combined ~50% selling at prices between $43 and $58. The elimination in Q1 2017 happened at prices between $62 and $66.

Iqvia Holdings (NYSE:IQV), previously Quintiles IMS: The ~5% IQV stake was purchased in Q1 2017 at prices between $75 and $82.50 and increased by ~70% the following quarter at prices between $78 and $91. The stock is now at ~$102. There was a marginal increase this quarter.

UnitedHealth Group (NYSE:UNH): The 4.61% UNH stake was established in Q2 2017 at prices between $164 and $187 and increased by ~160% the following quarter at prices between $185 and $200. The stock is now well above those ranges at ~$243. There was a ~17% trimming last quarter while this quarter saw a similar increase.

PayPal Holdings (NASDAQ:PYPL): PYPL is a ~4% position established in Q3 2017 at prices between $53 and $65 and increased by ~40% last quarter at prices between $64 and $79. It currently goes for $81.55. There was a ~12% further increase this quarter.

CSX Corporation (NYSE:CSX) and Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL): These two medium-sized positions purchased last quarter were increased this quarter. The 3.77% CSX stake was established at prices between $48.50 and $58 and the stock currently trades at $64.43. There was a ~17% increase this quarter at prices between $50.50 and $59.50. GOOG is a 3.40% portfolio position purchased at prices between $952 and $1,077 and it is now at $1,079. There was a ~8% increase this quarter.

Note: CSX is back in the portfolio after a quarter's gap. A 2.86% CSX stake was purchased in Q1 2017 at prices between $36 and $50. The following quarter saw a ~28% reduction at prices between $46 and $55. It was eliminated last quarter was at prices between $48 and $55.

TransUnion (NYSE:TRU): The 3.38% TRU position was purchased in Q2 2017 at prices between $38 and $49.50. The stock is now well above that range at $68.48. There was a ~14% trimming last quarter while this quarter saw a similar increase.

Note: Lone Pine Capital has a ~6.5% ownership stake in TransUnion.

Broadcom Ltd. (NASDAQ:AVGO): The 3.27% AVGO stake was purchased in Q3 2016 at prices between $150 and $178 and increased by just over one-third the following quarter at prices between $163 and $182. There was a ~50% stake increase in Q1 2017 at prices between $174 and $227. Last quarter saw an about turn: ~50% selling at prices between $239 and $285. The stock currently trades at ~$244. There was a ~11% stake increase this quarter.

MercadoLibre Inc. (NASDAQ:MELI) and Wynn Resorts (NASDAQ:WYNN): The 2.93% MELI position was purchased in Q3 2017 at prices between $233 and $292 and the stock is now at ~$315. There was a ~6% trimming last quarter while this quarter saw a similar increase. WYNN is a ~2% position purchased in Q3 2017 at prices between $125 and $149 and reduced by ~50% last quarter at prices between $140 and $170. This quarter saw a ~78% stake increase at prices between $162 and $201. The stock is now at ~$194.

FleetCor Technologies (NYSE:FLT) and Sea Limited ADR (NYSE:SE): These very small (less than ~1% of the portfolio each) stakes saw increases this quarter.

Kept Steady:

TransDigm Group (NYSE:TDG): The ~2% TDG position was purchased last quarter at prices between $256 and $285 and it is now at $336.

The spreadsheet below highlights changes to Mandel's US stock holdings in Q1 2018:

Stephen Mandel - Lone Pine Capital - Q1 2018 13F Report

Disclosure: I am/we are long TV.

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.