Did Bill Ackman shop at the wrong retailer when he scooped up more than 39 million shares of JCPenney? It sure seems so at this point. Investors do not seem confident that the embattled department store chain can turn itself around with its everyday low pricing policy. Shares of Penney plummeted to $17.97 on Monday, and the stock is now down about 33 percent in the past three weeks alone. However, on CNBC Tuesday the founder of Pershing Square passionately reaffirmed his commitment to the retailer, whose sales are down 26 percent. He explained that the stores that have converted to the new strategy are generating at least twice as much sales per square foot as the ones that have not been changed. Ackman, who sits on the board, paid a little over $25 for the stock.
Opening arguments began Tuesday in the insider trading trial of Anthony Chiasson, co-founder of Level Global Investors, and Todd Newman, former portfolio manager at Diamondback Capital Management. Prosecutor Richard Tarlowe told jurors in U.S. District Court in Manhattan that the pair used confidential information to break the law “to make big money for themselves and for their hedge funds.”
Busy day for Carl Icahn. The activist investor, who shuttered his hedge fund last year, has moved on to a new target. The billionaire investor disclosed Tuesday he owns more than 2.7 million shares, or 9.99 percent, of Greenbrier, a maker of railroad freight car equipment. He bought a big chunk for slightly less than $14 a share and another chunk for around $17 a share. Icahn said in his 13D filing that he bought the shares because they are undervalued. He also said he plans to have further discussions possibly relating to strategic opportunities, though he did not provide specific recommendations. The stock Tuesday surged more than 20 percent to close at $16.73. Also on Tuesday, Icahn disclosed that he lifted his stake in Enzon Pharmaceuticals to 13.29 percent. Icahn also raised his position in Take-Two Interactive Software to 11.69 percent. In addition, Icahn filed a preliminary proxy in his fight to take control of Oshkosh.
Ray Dalio’s Bridgewater Associates expanded its three largest positions — all exchange traded funds — in the third quarter. As a result, they now account for more than 80 percent of his equity assets, up a little from 77 percent in June. The three largest holdings are the SPDRs that track the S&P 500, a Vanguard ETF that tracks the MSCI emerging markets index, and an iShares index that tracks emerging markets.
Leon Cooperman’s Omega Advisors nearly doubled its stake in American International Group, to more than 8 million shares, making it the fund’s largest holding at the end of the third quarter. It is followed closely by SLM Corp. and Sprint Nextel.
Seth Klarman’s Baupost Group, which is not known for its stock-picking, trimmed its U.S. equity portfolio by about $500 million, to $3.3 billion.
Dan Benton, who has revived his Andor Capital Management, disclosed he had $911 million distributed over 22 issues at the end of the third quarter. The tech expert’s top three positions, however, accounted for 45 percent of the fund’s total U.S. equity assets: Google, Apple and Amazon.com.
