Apple Is Amongst This $3 Billion Fund’s Top Picks

Page 1 of 2

Established in 2008, Senator Investment Group was faced with extreme market conditions in its infancy, but that didn’t stop founders Douglas Silverman and Alexander Klabin from accumulating almost $3bn in assets under management. The two investors worked at York Capital Management prior to opening their fund, honing their skills in value, event-driven, and special situation/distressed investing. We recently took a peek at their latest 13F filed with the SEC to see where they are putting their investors’ money to work, evaluating their largest positions first and foremost.

Apple Inc. (NASDAQ:AAPL)

The duo has built their largest holding in Macquarie Infrastructure Company (NYSE:MIC). With a relatively small capitalization of $2.2bn, MIC primarily operates infrastructure businesses that provide basic services such as building cooling and gas utility services. Investors who got in a year prior and held were able to ride a 72% wave in their favor, but a high price relative to earnings gives this stock an unsavory trailing P/E ratio. Stockholders shrugged off significant earnings misses for most of 2012, instead choosing to hold for a very attractive 5.7% dividend yield. Although we see 2013 growth numbers being more realistic, we wouldn’t want to buy near the top and would leave this play for other sharks.

Senator’s second-largest holding is drug distributor and pharmaceutical service provider AmerisourceBergen Corp (NYSE:ABC). They sit at the top of this industry alongside Cardinal Health and McKesson. ABC’s price is valued at thirteen times its future earnings, but their high price-to-book suggests that the run they enjoyed in 2012 might need to see a pull-back. Sell-side analysts at firms like Goldman Sachs have the same convictions, dropping their previous buy ratings to holds. Similar to MIC, an investor looking to get in now may have missed most of the alpha, so we recommend turning an eye to value elsewhere (which hedge fund manager has almost $270mm invested in ABC? Find out here).

Continuing along the lines of pharmaceutical plays, Senator’s investing team has piled 4.7% of their portfolio into Watson Pharmaceuticals (NYSE:WPI). As of the end of 2011, Watson marketed roughly 190 pharmaceutical product families in the United States, 160 of those being generic and 30 being brand name. In November of last year, Watson completed their acquisition of Actavis, creating the third largest global generics company with significant international presence. Investors responded positively, pushing the stock to a near-50% gain in 2012. Quarterly revenue and earnings growth are healthy, and we recognize continued value in this play as the conjoined company makes use of their new economies of scale.

Click to the next page to see the rest of Senator’s top picks.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

6 Ways to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

10 High Paying Seasonal Jobs in America this Holiday Season

The 10 Busiest Shipping Lanes in the World

5 Most Valuable Brands in China

The 10 States with Highest Substance Abuse Rates Crippling Their Populace

The Top 10 Things to Do Before You Die That Will Echo for Eternity

The 10 Best Selling Items on Etsy

Top 10 Things to Do in Tokyo, the Greatest City in the World

10 Mistakes on Social Media that Can Harm You and Will Probably Get You Canned

The 10 Best Cities to Find Jobs in 2014

The 10 Most Controversial Songs Of All Time to Hit (and get Banned from) the Airwaves

The 20 Biggest IPOs in US History

The 10 Best Places to Visit in Mexico that Are Beautiful and Safe

7 Bad Habits that Age You Beyond Your Years

The 40 Best Fortune Cookie Sayings That Will Leave You Bemused, Befuddled, or Beguiled

10 Foods to Eat Before a Workout to Make Every Drop of Sweat Count

The 5 Best Documentaries On Netflix You Must See

The Most Heartwarming and Inspirational Story Of This Halloween Season, It Will Make You Cry and Jump For Joy

10 Best Party Songs of All Time to Bring the House Down With

5 New World Order Conspiracy Theories that Will Strangle the World

The 10 Highest Rated Movies of 2014

The 10 Largest Container Shipping Companies in the World

The 10 Largest Armies in the World: Who Should We Be Afraid Of?

Best Warren Buffett Quotes on Money You Need to Hear

The 10 Highest Suicide Rates by Profession

The 20 Most Underrated Movies of All Time

The 10 Fastest Growing Companies in America

The 10 Biggest Outlet Malls in USA

The 5 Most Popular Rap Songs of All Time

The 10 Countries that Eat the Most Meat

The10 Most Expensive Countries to Fly To

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!