In May, billionaire Stanley Druckenmiller (who formerly managed Duquense Capital and served as a portfolio manager for George Soros) filed his 13F for the first quarter of 2013. Despite the age of this information, we’ve found that there are a couple ways to use 13Fs. First of all, we’ve found that it’s possible to use these filings to develop investment strategies; for example, the most popular small cap stocks among hedge funds earn an average excess return of 18 percentage points per year (learn more about our small cap strategy). We can also compare the most recent filing to the previous one in our database to see which stocks fund managers added to their portfolio last quarter. Read on for our quick take on Druckenmiller’s five largest new holdings from the filing or see the full list of stocks he reported owning.
According to the 13F, Druckenmiller initiated a position of 2.3 million shares in News Corp (NASDAQ:NWSA). The company is scheduled for a breakup, and we’ve noticed a number of billionaires buying the stock ahead of that event. Spinouts often increase shareholder value because management of the spinout and the parent company become better able to focus on operations (learn more about investing in spinouts), and some investors have suggested that a similar result could occur from the News Corp (NASDAQ:NWSA) breakup. In addition, the company as it currently stands is not that expensive anyway with a forward P/E of 16.
Pioneer Natural Resources (NYSE:PXD) was another of the billionaire’s new picks with the filing disclosing ownership of 320,000 shares. The $20 billion market cap oil and gas exploration and production company experienced a decline in net income last quarter compared to the first quarter of 2012, and even with the sell-side expecting business to improve next year the forward earnings multiple is a fairly high 24. Pioneer Natural Resources (NYSE:PXD) was billionaire T. Boone Pickens’s largest holding at the end of the quarter according to Pickens’s own 13F (find more favorite stocks from T. Boone Pickens).