Tracking Larry Robbins' Glenview Capital Management Portfolio - Q1 2020 Update

Summary

• Glenview Capital Management’s 13F portfolio value decreased around two-thirds from $11.42B to $3.68B this quarter. The number of positions decreased from 50 to 44.
• Most of the top positions were reduced substantially during the quarter.
• The top three stakes are Takeda Pharmaceutical, Tenet Healthcare, and Cigna. They add up to ~23% of the portfolio.

This article is part of a series that provides an ongoing analysis of the changes made to Larry Robbins’ 13F portfolio on a quarterly basis. It is based on Robbins’ regulatory 13F Form filed on 05/15/2020. Please visit our Tracking Larry Robbins’ Glenview Capital Management Portfolio article for an idea on his investment philosophy and our previous update for the fund’s moves during Q4 2019.

This quarter, Robbins’ 13F portfolio value decreased ~68% from $11.42B to $3.68B. The number of holdings decreased from 50 to 44. The top five positions are Takeda Pharmaceutical, Tenet Healthcare, Cigna, Bausch Health, and HCA Holdings. Together, they are at ~37% of the 13F assets.

New Stakes:

Boston Scientific (BSX): BSX is a 2.12% of the portfolio position purchased this quarter at prices between ~$26 and ~$46 and the stock currently trades at ~$38.

Baxter International (BAX) and Molina Healthcare (MOH): These are small ~1% positions established this quarter. The 1.07% BAX stake was purchased at prices between $72 and $93 and the stock currently trades at ~$90. MOH is a 1.06% position established at prices between $108 and $154 and it is now at ~$186.

Intuitive Surgical (ISRG), Coherus BioSciences (CHRS), Abbott Laboratories (ABT), Medtronic plc (MDT), and Edwards Lifesciences (EW): These are minutely small (less than ~0.20% of the portfolio each) new stakes established during the quarter.

Stake Disposals:

Anthem Inc. (ANTM): ANTM was a ~2% of the portfolio position. It was established in Q4 2014 at prices between $111 and $129 and increased by just over one-third the following quarter at prices between $123 and $158. The position had since wavered. Recent activity follows: Last two quarters had seen a ~14% selling at prices between $235 and $311. The disposal this quarter was at prices between $175 and $308. The stock is now at $294.

DaVita Inc. (DVA): DVA was a 1.26% portfolio position built in H1 2019 at prices between $43.50 and $59.25. It was reduced by ~40% last quarter at prices between $54 and $75. The elimination this quarter was at prices between $65 and $89. It is now at $81.

Fidelity National Information Services (FIS): The FIS stake came about as a result of the acquisition of Worldpay by FIS that closed in July. Terms called for Worldpay shareholders to receive 0.9287 shares and $11 cash for each share of Worldpay held. Glenview had 848K shares of Worldpay for which they received these shares. Glenview also reduced the stake by ~25% during the quarter. Last quarter saw another one-third selling at prices between $125 and $140. The remaining position was sold this quarter at prices between $102 and $157. The stock is now at ~$139.

LyondellBasell Industries (LYB): LYB position was purchased in Q3 2018 and built over the next two quarters at prices between $78.50 and $116. Q3 2019 saw a ~57% selling at prices between $69 and $90. That was followed with a ~70% reduction last quarter at prices between $81.50 and $97.50. The stock currently trades at $63.76. The remainder ~0.5% portfolio stake was disposed during the quarter.

Thermo Fisher Scientific (TMO): The 0.59% TMO position had been in the portfolio for over a decade. The original stake was a fairly large ~7% of the portfolio position purchased in 2006 in the mid-$30s price range. The stake had wavered. Recent activity follows: last year saw the position reduced by ~80% at prices between $221 and $327. The remainder stake was disposed this quarter. The stock is currently at ~$349. Robbins harvested gains.

Walt Disney (DIS): The 2.57% DIS stake was established in Q1 2019 at prices between $106 and $115. Next quarter saw a ~160% stake increase at prices between $112 and $142. There was an ~11% stake increase last quarter, but this quarter saw the entire position eliminated at prices between $86 and $148. The stock currently trades at ~$117.

T-Mobile US (TMUS): TMUS was a small ~1% of the portfolio stake established in Q2 2019 at prices between $69 and $78. Next quarter saw a ~20% stake increase at prices between $74 and $84. There was a ~5% trimming last quarter and that was followed with the disposal this quarter at prices between $74 and $100. The stock is now at ~$100.

Allergan plc (AGN), Boeing Company (BA), Elanco Animal Health (ELAN), Facebook Inc. (FB), PRA Health Sciences (PRAH), Univar Solutions Inc. (UNVR), and Williams Companies (WMB): These small (less than ~1.5% of the portfolio each) positions were eliminated during the quarter.

Stake Increases:

Insperity Inc. (NSP), Michaels Companies (MIK), United Rentals (URI), and Universal Health Services (UHS): These very small (less than ~1% of the portfolio each) positions were increased during the quarter.

Stake Decreases:

Takeda Pharmaceutical (TAK): TAK is now the largest position at 8.24% of the portfolio. It came about as a result of Takeda’s acquisition of Shire plc. Glenview had a large position in Shire plc for which they received Takeda shares. They also increased the resultant stake by ~10% in Q1 2019 at prices between $16.70 and $21.50. The stock currently trades at $19.50. Last three quarters had also seen a combined ~17% increase. There was a one-third reduction this quarter at prices between $13 and $20.

Cigna Corporation (CI): CI is a very long-term top-three ~7% stake that has been in the portfolio since 2007. The stake has wavered. Recent activity follows: Q2 and Q3 2019 had seen a combined ~18% stake increase while last quarter there was a similar reduction. This quarter saw another two-thirds selling at prices between $130 and $223. The stock is now at $197.

HCA Healthcare (HCA): HCA is a top five position at 6.87% of the portfolio. The original stake was from 2011 when 8.8M shares were purchased at a cost-basis in the low-$20s. The position has wavered. Recent activity follows: last three quarters had seen a ~40% stake increase at prices between $112 and $150. That was followed with a ~53% selling this quarter at prices between $68 and $151. The stock is now at $107.

McKesson Corp. (MCK): The large ~6% MCK stake was first purchased in Q4 2016 and built over the next two quarters at prices between $124 and $167. The position saw a ~130% increase in Q3 2017 at prices between $146 and $168 and that was followed with a ~40% increase the following quarter at prices between $135 and $163. Last three quarters had seen a ~25% selling at prices between $112 and $153. That was followed with a ~55% selling this quarter at prices between $116 and $171. The stock is now at ~$159.

IQVIA Holdings (IQV) previously Quintiles IMS: The large ~5% IQV stake was established in Q2 2016 at prices between $61 and $71 and increased by ~75% in the following quarter at prices between $65 and $81. There was a stake doubling in Q4 2016 primarily due to the merger transaction between Quintiles and IMS that closed in October. The position has since wavered. This quarter saw a ~55% reduction at prices between $84 and $166. The stock is now at ~$150.

FMC Corporation (FMC): FMC is a 4.31% of the portfolio stake established in Q1 2015 at prices between $55 and $65 and increased by ~180% the following quarter at prices between $51.50 and $61. The position had since been increased. Recent activity follows: Last three quarters had seen a two-thirds selling at prices between $71 and $102. That was followed with a one-third reduction this quarter at prices between $60 and $108. The stock is now at $98.41.

Hologic (HOLX): The 3.73% HOLX stake was purchased in Q2 2018 at prices between $36.50 and $40.50 and increased by a whopping ~575% next quarter at prices between $38 and $43. Q2 and Q3 2019 saw a ~24% selling at prices between $43 and $52 while last quarter there was a similar increase at prices between $45.50 and $53.50. There was a ~60% selling this quarter at prices between $29 and $55. The stock currently trades at $53.

ViacomCBS (VIAC): VIAC is a 3.54% of the 13F portfolio position established last quarter. Glenview had 4.14M shares of CBS Corporation for which they received the same number of shares in the new entity ViacomCBS formed in the merger transaction with Viacom. Glenview also increased the position by ~250% during the quarter. This quarter saw the position sold down by ~40% at prices between $11.30 and $42. VIAC currently trades at $20.74.

Note: Details on the original CBS position follows - A 1.76% stake was first purchased in 2013 and a large increase happened in Q4 2014 at prices between $49 and $57. The position had since wavered: 2017 saw a one-third increase at prices between $55 and $69. There was a ~3% trimming in Q1 2018 and that was followed with a ~35% reduction over the next two quarters at prices between $49 and $59.

Humana Inc. (HUM): The 2.87% HUM stake was established in Q4 2018 at prices between $273 and $354 and increased by ~600% next quarter at prices between $263 and $310. There was another one-third stake increase in Q2 2019 at prices between $233 and $277. The stock currently trades at ~$411. Last two quarters had seen a ~20% selling at prices between $253 and $371. That was followed with a ~70% reduction this quarter at prices between $214 and $379.

Avis Budget (CAR) and Nuance Communications (NUAN): These two positions saw large increases in H2 2019 but were reduced this quarter. The ~2% CAR stake was increased by ~130% at prices between $24 and $36.50. This quarter saw a ~55% selling at prices between $8 and $50. The stock currently trades at $21.53. NUAN is a 2.79% position that saw a ~130% stake increase in H2 2019 at prices between $14 and $18. This quarter saw a ~55% selling at prices between $14 and $23. It is now at $22.88.

Fiserv Inc. (FISV): FISV­ is a ~2% of the portfolio stake established in Q3 2019 as a result of Fiserv’s acquisition of First Data Corp. that closed in July. Terms called for First Data shareholders to receive 0.303 shares of FISV for each share of FDC. Glenview had 13.77M shares for which they received 4.17M shares of FISV. That position was reduced by one-third during the quarter at prices between $92 and $109. That was followed with a similar reduction last quarter at prices between $101 and $117. This quarter also saw a ~53% selling at prices between $77 and $124. The stock currently trades at $107. Glenview is realizing long-term gains.

Alphabet Inc. (GOOG) (GOOGL): GOOG is now a small ~1% stake. It was first purchased in Q1 and Q2 2015 at prices between $492 and $575. The position has wavered. Recent activity follows: Q4 2018 saw a ~40% stake increase at prices between $976 and $1203 while next quarter there was a ~9% trimming. Q2 2019 saw a ~27% selling at prices between $1,036 and $1,288 and that was followed with similar reduction next quarter at prices between $1,098 and $1,250. The stock is now at $1,429. This quarter saw the position reduced by ~85% at prices between $1,057 and $1,527. Glenview realized gains.

Global Payments (GPN): The ~1% GPN stake was purchased in Q3 2019 at prices between $154 and $175 and the stock currently trades just above that range at ~$180. Last quarter saw a ~50% selling at prices between $155 and $184. That was followed with a one-third reduction this quarter at prices between $116 and $209.

Myriad Genetics (MYGN): MYGN is a 0.60% of the portfolio position purchased in Q3 2019 at prices between $22 and $47 and the stock currently trades well below that range at $14.53. Last quarter saw a ~7% trimming and that was followed with a ~55% reduction this quarter at prices between $10 and $29.50.

AmerisourceBergen Corp. (ABC), Centene Corp. (CNC), Corteva (CTVA), eBay Inc. (EBAY), Element Solutions (ESI), Endo International plc (ENDP), Flex Ltd. (FLEX), Lowe’s Companies (LOW), Microsoft Corp. (MSFT), Pacific Biosciences (PACB), and UnitedHealth Group (UNH): These small (less than ~1% of the portfolio each) positions were reduced this quarter.

Kept Steady:

Tenet Healthcare (THC): THC is top-three 7.73% portfolio stake established in 2012 at a cost-basis in the low-$20s. The original position saw a ~40% increase in Q4 2013 at around $44. Last two quarters of 2015 saw a combined ~20% increase at prices between $27 and $61. The stock currently trades at $21.76. There was a ~9% stake increase in Q3 2019 at ~$20 per share.

Note 1: Glenview controls ~19% of the business.

Note 2: In August 2017, Glenview’s two directors resigned from THC’s board citing irreconcilable differences. In March 2018, Tenet’s board reached an agreement with Glenview whereby they agreed to vote in favor of the board’s nominees in return for bylaw amendments.

Bausch Health Companies (BHC): BHC is a ~7% of the portfolio position established in Q3 2018 at prices between $20.50 and $27.50 and built over the next two quarters at prices between $17.50 and $28.50. The stock is now at $18.48. Q3 2019 saw a ~42% stake increase at prices between $21 and $26. That was followed with a ~20% stake increase last quarter at prices between $19 and $32. For investors attempting to follow, BHC is a good option to consider for further research.

DXC Technology (DXC) previously Computer Sciences Corp.: DXC is a 3.90% of the portfolio stake. The position was established in Q1 2016 at prices between $27 and $34. The four quarters through Q3 2018 had seen a combined ~38% selling at prices between $75 and $96 while next quarter the stake was almost doubled at prices between $50 and $94. Q1 2019 also saw a ~20% stake increase at prices between $53 and $69. There was an ~8% stake increase in Q3 2019 while last quarter saw a similar reduction. The stock is now at $14.21.

Note: Computer Sciences Corporation and Hewlett Packard Enterprise (HPE) had announced a spin-merger transaction whereby HPE’s Enterprise Services business was to be spun-off and merged into CSC to form a new business DXC Technology. That transaction closed in April 2017. Terms called for CSC shareholders to receive one share of DXC for each CSC share held.

Brookdale Senior Living (BKD), Meritor Inc. (MTOR), and Nuance debt: These small (less than ~2.5% of the portfolio each) positions were kept steady during the quarter.

Note: Glenview controls ~10% of Brookdale Senior Living and ~9% of Meritor Inc.

The spreadsheet below highlights changes to Robbins’ 13F stock holdings in Q1 2020:

Analyst’s Disclosure: I am/we are long GOOGL, VIAC. 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.

Comments

[katmandu100]

Good data and commentary.

[rjoh129793]

Long VIAC!