| Barry Rosenstein, JANA Partners (Bloomberg) |
Easy come, easy go.
Barry Rosenstein’s JANA Partners posted a loss in June after posting strong gains in May. As a result, the New York hedge fund firm, known mostly for its shareholder activism, has now lost money in 12 of the past 18 months.
The three main hedge funds under the JANA Partners Fund umbrella each lost 1.2 percent last month. They are now down 5.8 percent or 5.9 percent, depending on the portfolio, for the first half of the year. The firm’s JANA Nirvana Fund lost 1.8 percent in June and is down 8.6 percent for the first half of the year.
JANA’s largest positions were not hammered as hard during the two-day market sell-off following the Brexit vote as other stocks owned by big-name activist managers. JANA can’t even blame its largest positions for its woes in June or for the year.
Shares of ConAgra Foods rose 4.6 percent in June. They also gained 14.5 percent in the first half of the year. In the first quarter, the hedge fund firm cut its stake in the packaged foods giant.
On Friday, Credit Suisse raised its target price on the stock to $50 from $48 per share, after ConAgra reported results for the fourth fiscal quarter that met expectations. The bank added that the company finished “a strong year of productivity gains, operating discipline, and margin expansion.”
Walgreens Boots Alliance, which has been among JANA’s largest holdings for more than a year, rose about 7.6 percent last month. However, for the year the stock is down about 1.6 percent. But this is still much less than the overall fund.
On the other hand, Microsoft Corp., its third-largest long holding as of the end of the first quarter, fell about 3.4 percent last month. The stock is also down nearly 8 percent for the year.
Three of JANA’s top eight individual longs were new positions established in the first quarter. And two of them have been very costly to the hedge fund firm.
Shares of Alphabet’s class-C shares fell nearly 6 percent in June alone and were down more than 7 percent in the second quarter. Stericycle, a provider of medical and pharmaceutical waste management, jumped 6 percent last month. However, the stock slid more than 17 percent in the second quarter.
Hospital staffing firm Team Health Holdings, on the other hand, plunged 17 percent last month after surging 14.6 percent in May. This is JANA’s newest activist target. In February, JANA nominated three individuals to the company’s board of directors. In March, Team Health agreed to put Scott Ostfeld, a JANA partner and co-portfolio manager of JANA Strategic Investments, and Edwin Crawford, former chairman of CVS Caremark Corp., on the board of directors. Under the deal, the two parties also agreed that Nancy Schlichting, chief executive officer of Henry Ford Health System, will be appointed as a director in January 2017. The stock was down a little less than 3 percent for the quarter.
