| Barry Rosenstein, JANA Partners LLC (photo credit: Andrew Harrer/Bloomberg) |
JANA Partners’ performance last month was fueled by natural gas company EQT Corp. as its other holdings produced mixed results.
The hedge fund, headed by Barry Rosenstein, posted a 0.3 percent gain in July, receiving a big boost from its activist position in EQT. The firm is up 6.1 percent for the year, lagging the Standard & Poor’s 500 index’s 11.6 percent gain in the first seven months of 2017.
A major reason JANA was in the black in July was its sizable investment in EQT, whose shares surged nearly 9 percent last month to make it one of the firm’s top performers. JANA, which ranks roughly in the middle of the activist pack this year, has publicly opposed the natural gas company’s planned acquisition of Rice Energy.
The hedge fund disclosed its EQT holding in early July, threatening to launch a proxy fight with the company’s board over the $6.7 billion deal with Rice. On July 31, JANA fired off another letter to the board, questioning some of its metrics used to support the planned merger.
The firm has seen some recent success with another activist target, Whole Foods Market. In June, JANA’s hedge fund performance benefited when Whole Foods agreed to be acquired by Amazon.com for $13.7 billion. Shares of the grocer fell slightly in July.
We won’t know which other stocks JANA held heading into July for another two weeks. And in recent quarters, JANA has tended to heavily overhaul its portfolio.
This said, based on the hedge fund’s largest disclosed investments at the end of the first quarter, JANA saw mixed results from its top holdings. Its best-performing sizable position was in Liberty Broadband Corp., which surged more than 14 percent in July. In other examples, shares of HD Supply Holdings, a supplier of industrial products, was up 6.2 percent while Dow Chemical rose 2 percent.
On the down side, two of JANA’s largest holdings posted sharp losses last month, contributing heavily to the fund’s muted results.
Hospital management company Universal Health Services, for example, fell 9.2 percent in July. The stock has continued to tumble, falling about 11 percent since July 20, the day the Congressional Budget Office scored the Senate’s latest proposal to repeal and replace the Affordable Care Act.
Another major holding, packaged foods giant ConAgra Brands, was down 6.8 percent in July.