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Activist Stocks

The Uguly August For Hedge Funds

In August, per HFR, the average fund lost 2.2% (versus the S&P 500’s 6% fall) and is down 1% for the year. Some big name funds aren’t so lucky.

Bill Ackman’s Pershing Square was down 9.2% in August, putting the fund down 0.1% for the year.

Top holding Mondelez (MDLZ) was down 6% for the month of August, no. 2 holding Valeant (VRX) was off 10.5%, no. 3 Air Products was down 2%, no. 4 Canadian Pacific (CP) was down 10%, no. 5 Zoetis (ZTS) down 8% and no. 5 Restaurant Brands (QSR) off 11%. Collectively, eight make up the bulk of the long-only portfolio.

David Einhorn’s Greenlight Capital was down 5.3% in August and now down 13.8% for the year.

Top holdings Apple (AAPL) and GM (GM) were down 7% and 6.6%, respectively, in August. Everyone wants to talk about SunEdison, which was off 55% for the month, with Micron Tech and CONSOL also being down 11% and 8%, respectively, for the month. Einhorn was cutting some of his long and short bets in August, though.

Dan Loeb’s Third Point was off 5.2% last month, but still up 1.2% for the year.

Third Point’s top holding, Baxter (BAX) was off 4% in August, no. 2 holding Amgen (AMGN) was down 14% and no. 3 Allergan (AGN) was down 8.2%. Collectively, the three make up about 40% of the long-only portfolio.

Barry Rosenstein’s JANA Partners was down 4.3% in August and down 2.9% for the year.

JANA’s top holding, Qualcomm (QCOM), was down 12% in August. Other top holdings off big in August were Walgreen (WBA), down 10.4%, and ConAgra (CAG), down 5.4%.

Other activists down in August were Cliff Robbins’ Blue Harbour, off 2.6% for the month, and Scott Ferguson’s Sachem Head Capital, down 2%.

Jeff Ubben’s ValueAct Capital, up 1.6% in 2Q, the standout of sorts - although it remains to be seen how he did in August. YTD through June, ValueAct is up 8%.

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By all accounts, it wasn’t a pretty August for ValueAct either, however. Top holding Valeant was down 10.5% in August, no. 2 holding Microsoft (MSFT) took a 7% hit during the month, no. 3 Halliburton (HAL) was off 6%, no. 4 Fox (FOX) off 17.5%, no. 5 Adobe (ADBE) down 4%. Collectively, the top 5 holdings make up 60% to 65% of its long-only portfolio.

That’ll be 2 and 20.

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