Billionaire Julian Robertson’s Major Moves Ahead of Q2

Julian Robertson is a hedge fund legend. Although he stopped managing money for his clients more than 10 years ago, Robertson is still widely followed in the media and his comments attract a lot of attention. Robertson’s Tiger Management had a stellar track record before running into some difficulties in the dot com bull market. Julian Robertson returned 31.7% per year after fees between 1980 and 1998, beating S&P 500’s 12.7% annual return by a huge margin. His fund was also the starting place for several other major hedge fund managers, aptly named Tiger Cubs. Given Tiger Management’s track record, let’s take a closer look at the 13F filing Tiger Management recently has filed for the first quarter and analyze its moves in several companies, including Apple Inc. (NASDAQ:AAPL), GrubHub Inc (NYSE:GRUB), Royal Caribbean Cruises Ltd (NYSE:RCL), FedEx Corporation (NYSE:FDX), and Facebook Inc (NASDAQ:FB).

Hedge fund sentiment is an important metric for assessing the long-term profitability. At Insider Monkey, we track nearly 800 hedge funds, whose quarterly 13F filings we analyze and determine their collective sentiment towards several thousand stocks. However, our research has shown that the best strategy is to follow hedge funds into their small-cap picks. This approach can allow monthly returns of nearly 95 basis points above the market, as we determined through extensive backtests covering the period between 1999 and 2012 (see the details here).

Facebook Shines but Tiger Management Paring Stake

Although Facebook Inc (NASDAQ:FB) has been a strong performer, Tiger Management apparently took some profits and cut its position by 58% to 212,000 shares valued at $24.19 million at the end of the quarter, equal to 6.06% of Tiger Management’s equity portfolio. Many investors view Facebook Inc (NASDAQ:FB) as a great company given its network effects of over 1 billion users and given its visionary CEO, Mark Zuckerberg, who founded the company just 12 years ago. Growth has been very healthy for the company, with revenue rising a stunning 52% year-over-year for Facebook’s latest quarter. Earnings have also outperformed expectations. Nevertheless, some worry that the stock is no longer cheap anymore given its bull run over the past year. Tiger cub Stephen Mandel’s Lone Pine Capital held 11.41 million shares of Facebook at the end of March.

Tiger Management Loves This Economically Sensitive Company

Although drones might challenge FedEx Corporation (NYSE:FDX)‘s business over the next two decades, business for FedEx is currently very brisk for the company right now. The company benefits from the strong U.S. economy and from the continued growth of e-commerce. Not surprisingly, FedEx Corporation (NYSE:FDX) reported excellent third quarter earnings, with EPS of $2.51 on sales of $12.7 billion, beating analyst estimates by $0.17 per share and $320 million. The stock is also pretty cheap with a forward P/E of 13. Tiger Management established a new position in FedEx, which contained 124,6000 shares, worth slightly over $20 million, at the end of the first quarter. That accounts for 5.08% of Tiger Management’s equity portfolio.

On the next page, we are going to take a look at Tiger Management’s moves in the other three stocks.