Third Point Investors got off to a strong start in 2024.
The multistrategy hedge fund firm headed by Dan Loeb was up 3.7 percent in March and 8.7 percent for the first quarter, according to its March monthly report. For comparison, the S&P 500 gained 5.3 percent in March and 7.1 percent for the quarter, including dividends reinvested.
Third Point had lost money in the first quarter of each of the two previous years. Its equities book accounted for most of the gains in March and in the quarter after it boosted its gross equity exposure, to more than 126 percent from 118.5 percent at the end of February, almost all of it on the long side. As a result, net long exposure rose to 87.2 percent at the end of March from 80.7 percent at the close of the previous month. In the first quarter, equities kicked in 7.4 percent to net performance and credit provided 1 percent.
In March, energy company Vistra Corp. was the biggest contributor to gains. It was also the firm’s second-biggest winner for the quarter. Interestingly, the stock was only the firm’s 12th-largest long position at year-end. On March 1, Vistra completed its acquisition of Energy Harbor Corp.
Third Point’s next-two-biggest contributors to last month’s performance were activist positions.
They include Advance Auto Parts, a position that was revealed by The Wall Street Journal less than a month ago when it reported that Third Point and another activist, Saddle Point Management, had agreed to a settlement with the company, resulting in three board seats for the two firms. Third Point did not identify Advance Auto Parts as a top-five holding in its March report.
Retailer Bath & Body Works, another activist position, was the third-biggest contributor to performance last month and the fourth-biggest to quarterly gains. Google parent Alphabet and UBS round out the top-five winners in March. For the quarter, Meta Platforms, Amazon, and Microsoft were also top-five contributors.
Chip company Marvell Technology was Third Point’s biggest loser for the month, followed by two separate undisclosed short positions. For the quarter, the three biggest losers were No. 1 long Pacific Gas & Electric, DuPont, and Humana.
At the end of March, the five largest long positions were unchanged from the previous month: PG&E, Amazon, Microsoft, Bath & Body Works, and Meta.