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Corvex Capital’s Top Holdings and Largest Moves from Last Quarter

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Keith Meister founded Corvex Capital, one of the biggest and most famous activist hedge funds, in 2011 after raising a seed capital of $250 million from George Soros. Meister earlier worked with famous activist hedge fund manager Carl Icahn, before venturing out on his own. The fund’s philosophy is to invest in special situations and distressed securities mostly in North America. Meister engages in value‐based investing in situations with identifiable catalysts. He was instrumental in getting Yum! Brands, Inc. (NYSE:YUM) to spin off its Chinese operations, which contributed about half of the fast food company’s sales, arguing that the move would generate more value for shareholders.

Out of 47 positions, Corvex Capital acquired seventeen holdings during the fourth quarter and increased its stake in six other companies. On the other hand, the investor also reduced its stakes in ten companies and closed eight positions. According to its latest 13F filing, the fund had a 13F portfolio valued at $5.79 billion heading into 2017, up from $5.34 billion a quarter earlier. In this article we are going to take a closer look at Corvex’s largest holdings as of the end of December, as well as at some new positions and companies in which the fund closed its stake.

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Keith Meister

Yum! Brands, Inc. (NYSE:YUM) was Corvex Capital’s largest holding, which contained 21.04 million shares valued at $1.33 billion at the end of the fourth quarter. On the other hand,  Stephen Mandel‘s Lone Pine Capital closed its stake in Yum! Brands, Inc. (NYSE:YUM), as it sold its entire holding of 6.26 million shares during the fourth quarter. Yum! Brands, Inc. (NYSE:YUM) reported fourth-quarter earnings of $0.79 per share on revenues of $2.02 billion, beating the estimates of $0.74 and $2.09 billion, respectively. The owner of KFC and Taco Bell benefited from strong sales in these restaurants, however, Pizza Hut sales fell by 2% on the year. The company spun off its Chinese subsidiary and the two began trading as separate entities on November 1. As stated earlier, this move was advocated by Meister to focus more on the company’s Asian businesses. Meister has recently stepped down from the company’s Board of Directors. While the number of funds from our database long Yum! Brands, Inc. (NYSE:YUM) remained unchanged at 42, the value of their holdings declined by 43% to $2.3 billion during the fourth quarter.

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Keith Meister’s fund sold 4.01 million shares of Signet Jewelers Ltd. (NYSE:SIG) during the fourth quarter, having reduced its holding to 2.91 million shares worth $274 million at the end of December. During the same period, Two Sigma Advisers sold its entire stake, which previously had contained 311,352 shares. Signet Jewelers Ltd. (NYSE:SIG) is a major retailer of jewelry and watches in the U.S., Canada and the UK with a market value of $5.2 billion. It operates around 3,620 stores and kiosks in-malls, strip centers and outlet store locations. Signet Jewelers Ltd. (NYSE:SIG)’s stock has lost almost one-fourth of its value over the last year. The stock price fell at the end of November after the company cut its fourth-quarter earnings guidance to $4-$4.05 per share, compared to the previous estimate of $4 to $4.20. A total of 33 hedge funds tracked by us held shares of Signet Jewelers at the end of December, down from 39 funds a quarter earlier.

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