Lone Pine Capital is managed by billionaire and Tiger Cub Stephen Mandel (“Tiger Cubs” are the group of hedge fund managers who previously worked at legendary investor Julian Robertson’s Tiger Management). We track quarterly 13F filings from Lone Pine and other hedge funds as part of our work developing investment strategies (we have found, for example, that the most popular small cap stocks among hedge funds outperform the S&P 500 by an average of 18 percentage points per year). We can also use our database to find individual managers’ favorite stocks according to a number of criteria, including those which they have owned for a fairly long period of time. Here are five stocks which Lone Pine owned in its most recent 13F (for December 2012) and at the end of 2010 (or see the full list of stocks the fund reported owning):
Lone Pine disclosed ownership of nearly 11 million shares of Cognizant Technology Solutions Corp (NASDAQ:CTSH) in its most recent filing, making it one of the fund’s five largest holdings by market value. Cognizant Technology Solutions Corp (NASDAQ:CTSH) is a $19 billion market cap IT services company; its stock price is down 13% since the beginning of 2011 after diving in April as investors look to the upcoming release of last quarter’s results. Financials were good during Q4, though the company is trading a bit expensively with a trailing P/E of 19. William Gray’s Orbis Investment Management has been another major shareholder in Cognizant Technology Solutions Corp (NASDAQ:CTSH) (research more stocks that Orbis likes).
Mandel and his team have also been long-term owners of Ralph Lauren Corp (NYSE:RL). The apparel and accessories designer had the third quarter of its fiscal year end in December; during the quarter, earnings grew 28% compared to the same period in the previous fiscal year but revenue was up only slightly. This suggests to us that it would be difficult for Ralph Lauren Corp (NYSE:RL) to continue high earnings growth, at least without better performance sales wise. Fellow Tiger Cub John Griffin’s Blue Ridge Capital reported a position of 1.6 million shares at the end of December (find Griffin’s favorite stocks).