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A Look Into Billionaire Steve Cohen’s Major Q4 Additions

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Steven Cohen founded the family office Point72 Asset Management in 2014 after agreeing to close his hugely successful hedge fund SAC Capital Advisors. Besides having an equity fund, the investment management firm also has a quant fund, a private equity fund, as well as an early stage venture capital fund. The long/short equity fund is headquartered in Stamford, Connecticut and makes investments based on both quantitative and macro parameters. Point72 Asset Management returned just 1% in 2016, underperforming many other funds and the S&P, which was up by 9.5%. According to Cohen, “growth is slow, valuations are high” and if it continues the same way, low returns can be expected over the next few years.

The family office had a 13F portfolio valued at $14.3 billion at the end of 2016, largely unchanged from $14.22 billion a quarter earlier. During the year’s final quarter, Point72 Asset Management added 285 stocks to its portfolio and sold out of 309 stocks. The filing also showed that its top-10 holdings constituted about 17.5% of the value of its 13F portfolio. In this article we’ll check out five of the stocks that Point72 was most bullish on during the fourth quarter.

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 – See our list of the 140 Biggest and Most Famous Activist Hedge Funds for further hedge fund reading.

Steve Cohen SAC CAPITAL ADVISORS

During the fourth quarter, Point72 Asset Management added 3.28 million shares of Tesoro Corporation (NYSE:TSO) to its portfolio, reporting a 3.4 million-share stake worth $298.7 million as of December 31. Another investor bullish on Tesoro Corporation (NYSE:TSO) was Jim Simons’ Renaissance Technologies, which initiated a stake of 976,500 shares during the fourth quarter. The San Antonio-based oil refiner reported fourth quarter results which beat bottom-line estimates but missed on the top-line. The company earned $0.03 per share for the quarter, well ahead of the consensus of a loss of $0.14, however revenue of $6.6 billion missed the estimates of $7.1 billion. Tesoro said that it would deliver $475 million-$575 million in operating income improvements in 2017. Tesoro Corporation’s (NYSE:TSO) stock has gained 4.7% over the last three months, as investors are upbeat about the new Republican policies strongly favoring the downstream oil sector. According to our database, 41 hedge funds (same as on September 30) held 19.5% of the company’s float as of December 31.

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In Visa Inc. (NYSE:V), Point72 increased its stake by 109% to 2.93 million shares worth $228.51 million at the end of December. On the contrary, Dan Loeb’s Third Point sold off its entire holding of 2.1 million shares during the same period. Visa Inc. (NYSE:V) is currently trading near its yearly highs at $87.50 and has returned almost 12% year-to-date. The company should do well as the global mobile payments market is expected to expand at a CAGR of 20.5% to reach a size of $1.7 trillion by 2024, and as major developing economies continue to shift to cash-less economies. Visa reported fiscal 2017 Q1 revenue of $4.5 billion and earnings of $0.86 per share, beating expectations of $4.29 billion and $0.78, respectively. The hike in its top-line results was driven by a 40% growth in payments volume and increasing transactions worldwide. As per our database, the number of funds long Visa Inc. (NYSE:V) decreased by four to 111, while the value of their holdings increased by 4% during the October-to-December period.

 

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We’ll check out three more stocks that the venerable Mr. Cohen was bullish on in Q4 on the next page.

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