Hedge Fund Analysis on Dan Loeb's Third Point (2010 Q1)

My next analysis is on Dan Loeb's Third Point, LLC. Dan Loeb's top 10 positions has a return 0f 25 percent this year beating the S&P 500 about 5 percent. We can see his portfolio is quite diverse, so his perfomance is very similer to the market as a whole. He had a lot of trades in the first quarter and in the second quarter. He had a few bad trades in the first semester, such as the Citi Group[C] trade. Dan got out his position on Citi after it went tumbled. And he sold it completely, which the market has told us was a really bad move. Also, he left his position on Popular Inc [BPOP] too early. The stock went up more than 100 percent after he sold the stock.

Total Market Value: $1.4 billion

Top Sector:

29% Financial

16% Technology

13% Health care

6% Capital goods

11% Services

24% Others

Top 10 Holdings

1. PHH Corp (PHH): 7.6%

2. Transdigm (TDG): 6.8%

3. CIT Group (CIT): 6.5%

4. Wellpoint (WLP): 6%

5. Health Net (HNT): 5.3%

6. Liberty Interactive (LINTA): 5.2%

7. OSI Pharmaceutical (OSIP): 5.1%

8. Xerox (XRX): 4.9%

9. Airgas (ARG): 4.2%

10. Walgreen (WAG): 4.0%

Recent Trades:

5/21/10
buy
Airgas Inc [ARG]
$61.48
5/21/10
buy
Liberty Interactive [LINTA]
$12.67
5/21/10
buy
OSI Pharm Inc [OSIP]
$57.38
5/21/10
buy
Walgreen Co [WAG]
$33.10
5/21/10
sell
Cablevision Systems Cp Class A [CVC]
$23.20
5/21/10
sell
Citigroup Inc [C]
$ 3.75
5/21/10
sell
Mead Johnson Nutrition [MJN]
$49.09
2/19/10
buy
CIT Group Inc [CIT]
$32.62
2/19/10
buy
Cablevision Systems Cp Class A [CVC]
$22.91
2/19/10
buy
Citigroup Inc [C]
$ 3.42
2/19/10
buy
Mead Johnson Nutrition [MJN]
$46.58
2/19/10
buy
Wellpoint Inc. [WLP]
$58.47
2/19/10
buy
Xerox Corp [XRX]
$ 9.16
2/19/10
sell
Bank of America Corp [BAC]
$15.86
2/19/10
sell
CF Industries Holdings Inc [CF]
$104.00
2/19/10
sell
Liberty Acquisition Holdings Corp [LIA]
$ 9.75
2/19/10
sell
Molson Coors Brewing Co [TAP]
$40.59
2/19/10
sell
Pfizer Inc [PFE]
$17.80
2/19/10
sell
Popular Inc [BPOP]
$ 2.00

Taken from Alphaclone

"Third Point, LLC is a New York based hedge fund with a focus on activist investing. The firm was founded in 1995 by Daniel Loeb who is know for his vocal and public criticism of management when he views the company as underperforming."

Hedge Fund Analysis on William Ackman's Pershing Square Capital Management (2010 Q1)

William Ackman's hedge fund Pershing Square Capital Management has a good performance in first quarter with a net gain of 5.62% (see performance of other funds of Q1). Let's have at his portfolio for the first quarter.

Total Market Value: $ 3.32 Billion

Top Sectors: 70% Services

30% Consumer-non cyclical

Top 8 positions

1 Target (TGT): 32.79%

2 Kraft Foods (KFT): 29.89%

3 Yum Brands (YUM): 17.56%

4 General Growth Properties (GGP): 11.62%

5 Corrections Corp of America (CXW): 6.55%

6 Landry's Restaurants (LNY): 0.84%

7 Borders Group (BGP): 0.55%

8 Greenlight Capital Re (GLRE): 0.20%

Recent Trades:
5/21/10
buy
General Growth Properties [GGP]
$13.12
5/21/10
buy
Kraft Foods Inc [KFT]
$29.69
5/21/10
buy
Yum! Brands [YUM]
$40.15
5/21/10
sell
Automatic Data Process [ADP]
$40.28
5/21/10
sell
Hyatt Hotels Corp [H]
$37.85
2/19/10
buy
Hyatt Hotels Corp [H]
$29.97
2/19/10
buy
Landry Restaurant [LNY]
$20.50
2/19/10
sell
EMC Corp [EMC]
$17.81
2/19/10
sell
Mcdonalds Corp [MCD]


From the Portfolio, we can see that Ackman was very long on consumers goods and retailers. It increased its stake in Kraft and Yum Brands during the filling in May. He was very confident that the economy is in recovery and hence consumers will soon increase their spending.
Recently, we learned that Target's sales outperformed the industry average in May (see report here) and Bill also started a position in Citi group.
Here is an interview with Bill Ackman on why he is interested in the Citi.

Taken from Alphaclone, "Pershing Square is a New York based activist, fundamental value hedge fund founded by William Ackman in 2003. In addition to being a Founder and Trustee at Pershing Square Capital Management, L.P, Mr. Ackman is also a Co-Founder and Chief Executive Officer at Gotham Partners Management Co., LLC and has co-managed the partnership since its inception. Mr. Ackman has been the Co-Investment Manager at Gotham LP, Gotham III LP, and Gotham Partners International Limited since January 1993."