What We're Reading ~ Hedge Fund Links 3/7/14
A look at Paul Tudor Jones [Dealbook]
Some hedge fund best ideas for 2014 [WSJ]
David Einhorn will speak at this upcoming conference [Make a Difference Wisconsin]
Einhorn: many stocks have completely disconnected from valuations [ValueWalk]
Loeb sees more volatility this year [Bloomberg]
Blackstone buys stake in Versace [FINalternatives]
Soros, Paulson in Spanish property REIT investments [FT]
TigerGlobal leads investment in OnDeck [HedgeWorld]
PepsiCo rejects Peltz's proposal to split up company [HedgeWorld]
Soros Fund Updates Digital River Position
George Soros' family office Soros Fund Management has updated its stake in Digital River (DRIV). Per an amended 13G filed with the SEC, Soros Fund has disclosed they own 6.97% of Digital River (DRIV) with over 2.47 million shares.
This is broken down by 16,050 shares and over 2.46 million shares issuable upon the conversion of 2.00% convertible bonds due November 1, 2030.
At the end of 2013, Soros Fund reported aggregate exposure to over 5.5 million shares, so this appears to be a decrease in aggregate exposure by around 3 million shares. The filing was required due to activity on March 4th.
Soros Fund also filed a Form 4 with the SEC on DRIV and it indicates they received $153,750,000 plus accrued and unpaid interest on the 2.00% convertible bonds they disposed of.
In other activity, Soros Fund also started a Polycom stake recently.
Per Google Finance, Digital River "provides end-to-end global cloud-commerce, payments and marketing solutions to a wide variety of companies in software, consumer electronics, computer games, video games and other markets. The Company offers its clients a broad range of services that enable them to quickly and cost effectively establish an online sales channel capability and to subsequently manage and grow online sales on a global basis while mitigating risks. The Company is engaged in providing outsourced commerce solutions globally to a variety of companies, primarily in the software and consumer electronics product markets. The Company's services include design, development and hosting of online stores and shopping carts, store merchandising and optimization, order management, denied parties screening, export controls and management, tax compliance and management, fraud management, digital product delivery via download, physical product fulfillment and subscription management."
Tiger Global Raises dELiA*s Stake
Chase Coleman and Feroz Dewan's hedge fund Tiger Global has updated its position in dELiA*s (DLIA). Per a 13G filed with the SEC, they now own 6.3% of the company with over 4.4 million shares.
This marks an increase of over 1 million shares since the end of 2013. The filing was made due to activity on February 18th.
They aren't the only hedge fund that's been active in this stock lately, either. David Gallo's Valinor Management started a DLIA stake recently and Lee Cooperman has owned DLIA as well.
Per Google Finance, dELiA*s is "a retail company comprised of two lifestyle brands primarily targeting teenage girls and young women. The Company generates revenue by selling predominantly to teenage consumers through direct mail catalogs, Websites and retail stores. It operates in dELiA*s brand. Through its e-commerce Webpages, catalogs and retail stores, dELiA*s (the brand) offers a variety of product categories to teenage girls to cater to an entire lifestyle. Through its catalogs and the e-commerce Webpages, it sells many name brand products along with its own brand products in key teenage spending categories. These products include apparel and accessories. Its mall-based dELiA*s specialty retail stores derive revenue primarily from the sale of apparel and accessories and, to a lesser extent, branded apparel to teenage girls. It operates in two segments: direct marketing and retail stores."
Jim Chanos Talks Short Positions at Reuters Summit
At the Reuters Investment Summit, Kynikos Associates founder Jim Chanos talked about his short positions and market outlook.
The hedge fund manager and prominent short seller noted he's betting against coal miners as a proxy for his bet against China. He thinks we're at the end of a commodities supercycle. This is not a new view as we've highlighted Chanos' negative view on China before.
Chanos is also short Exxon Mobil (XOM), which he labels a value trap. He believes the business of integrated oil companies has deteriorated over time. Chanos also points out that return on capital has dropped from 30% down to 20% at the company.
Turning to technology, the Kynikos founder says that a lot of these companies are in slow decline but are masking it via financial engineering and buybacks. Last year, Chanos highlighted he was short Hewlett Packard (HPQ).
In general, he feels now is a time for investors to be more cautious as the market's have become more "ebullient."
In terms of best new ideas, Chanos said that in the US he's shorting "conceptual companies, companies playing accounting games." He also said to focus on how the internet's changing business models from payment processors to retailers.
Embedded below is the video of Chanos' interview:
Luxor Capital Files 13D on BJ's Restaurants (BJRI)
Hedge fund Luxor Capital has filed a 13D on shares of BJ's Restaurants (BJRI) indicating they own around 9.7% of the company with over 2.7 million shares. This is a new position for the hedge fund as they did not report a stake at the end of 2013.
The filing was required due to activity on February 28th and the fine print of the filing indicates they're nominating five individuals to the board of directors.
A recent transaction breakdown shows that Luxor was out buying BJRI shares throughout January between $28.xx and $31.xx.
Per Google Finance, BJ's Restaurants "owns and operates restaurants. The company's restaurants operate under the BJ's Restaurant & Brewery BJ's Restaurant & Brewhouse, BJ's Pizza & Grill, or BJ's Grill names. The Company's menu features its BJ's deep-dish pizza, its hand-tossed style pizza, its craft beers and other beers, as well as a selection of appetizers, entrees, pastas, sandwiches, specialty salads and desserts, including its Pizookie dessert. The Company's BJ's Restaurant & Brewery restaurants feature on-premise brewing facilities where BJ's craft beers are produced for some of its restaurants."