Hedge fund firms with roots in Julian Robertson Jr.’s Tiger Management exhibited more convergence of their conviction in the second quarter than they have in recent memory.
More than half — 25 of 49 portfolios — had positions in social media pioneer Facebook. This is the most unanimity in a single stock since New York–based portfolio intelligence platform Novus has been tracking this data. Even Apple, when it was at its do-nothing-wrong stage, did not enjoy the same convergence among the Tiger crowd.
What’s more, the three most popular stocks among the Tiger crowd attracted more Tiger investors than any three stocks combined in the past, according to Novus.
This group of 49 funds is made up of Tiger Management as well as 48 descendants — some known as Tiger Cubs because the manager previously worked for Tiger; Grandcubs, because the manager previously worked for a Cub; or Seeds, because the firm was seeded by the legendary, octogenarian investor.
This widely followed group is mostly known for being predominantly long-short stock pickers. A number of them favor high-octane technology, telecommunications, media, Internet and consumer stocks, many of which are driving global economic change.
This group also tends to run more concentrated portfolios than other hedge fund managers, except for perhaps the activist firms.
And they often gravitate to different stocks than their hedge fund peers who have no links to Tiger.
In fact, only four of the 11 most popular stocks among the Tiger crowd at the end of the second quarter ranked among the 11 most popular stocks of all hedge funds tracked by Goldman Sachs: Facebook, Amazon.com, Alphabet and Microsoft Corp.
| Most Popular Stocks Among Tiger Crowd in the Second Quarter | ||
| Company | Ticker | # of Tiger Funds owning stock |
| FB | 25 | |
| Amazon.com | AMZN | 20 |
| Charter Communications | CHTR | 19 |
| Alphabet “C” | GOOG | 15 |
| Fleetcor Technologies | FLT | 15 |
| The Priceline Group | PCLN | 13 |
| Microsoft | MSFT | 12 |
| Liberty Global “C” | LILAK | 12 |
| Expedia | EXPE | 11 |
| Paypal Holdings | PYPL | 11 |
| Constellation Brands | STZ | 11 |
| Alphabet “A” | GOOGL | 10 |
| Visa | V | 10 |
| Mastercard | MA | 9 |
| Transdigm Group | TDG | 9 |
| Pioneer Natural Resources | PXD | 8 |
| JD.com | JD | 8 |
| T-Mobile US | TMUS | 8 |
| Source: Novus. Based on reporting of 49 investment firms. | ||
The seven top holdings that are more widely held by the Tiger crowd than the hedge fund community at large are Charter Communications, FleetCor Technologies, the Priceline Group, Liberty Global, Expedia, PayPal Holdings and Constellation Brands.
In fact, in the second quarter three stocks cracked the Tiger Top 21 list (the odd number accounts for ties) for the first time since Novus has been tracking this data: PayPal, Pioneer Natural Resources Co. and T-Mobile US.
Novus calls itself a portfolio intelligence firm. Among other things, the New York firm analyzes the quarterly filings of hedge funds.
Altogether, the firm tracked 49 Tiger-affiliated firms, which disclosed a total of $130 billion invested in U.S. stocks in their second-quarter 13F filings.
The Facebook bet is not too surprising. It is the most popular stock among all hedge funds, held by at least 169 firms. In the first quarter 22 Tiger firms held a position in the stock.
The Tiger firm with the largest position in the stock at the end of the second quarter was O. Andreas Halvorsen’s Greenwich, Connecticut–based Viking Global Investors. Its stake was worth $2.3 billion, enough to be Viking’s second-largest holding.
Facebook is also the third-largest position of Stephen Mandel Jr.’s Greenwich, Connecticut-based Lone Pine Capital, the second-largest Tiger holder of the stock. Other large investors include New York–based Coatue Management, New York–based Blue Ridge Capital and Dallas-based Maverick Capital.
Online retailing giant Amazon.com was the second-most-popular Tiger stock in the most recent quarter, with 20 firms holding a position, up from 16 the previous quarter. They are led by Viking, which counts it as the firm’s largest long; Lone Pine; and New York–based Tiger Global Management.
“We believe the company is still in the early stages of gaining share in retail sales and enterprise spend, allowing it to sustain its positive trend in revenues and margins,” Viking told clients in its second-quarter letter, calling the current valuation “compelling.”
Cable giant Charter, which ranks third with 19 Tiger firms holding stakes, saw the net number of Tiger investors grow by one in the second quarter. By far the largest investors are Lone Pine and Tiger Global.
In its second-quarter letter, Chase Coleman’s Tiger Global told clients that Charter’s stock could double in the next three or four years, noting that the company is one of the two largest Internet and pay-TV service providers in the U.S.
PayPal Holdings is a newcomer to the list of most popular Tiger stocks. Some 11 Tiger firms held the online payments company, led by Lone Pine. The stock is the ninth-largest U.S. long held by Coatue.
Another interesting company on this list is Pioneer Natural Resources. This is the stock Greenlight Capital’s David Einhorn — not a Tiger descendant — famously dubbed the “mother fracker” when he first announced he was shorting it about 18 months ago.
One stock whose popularity has quickly waned is Netflix, the streaming video giant. Just seven Tiger funds held a position at the end of the second quarter. This is down from 13 just one quarter earlier.
Among those that liquidated their Netflix position in the June period: Tiger Global, which had made the stock its largest position in the first quarter, and Tiger Management.
