Since launching his presidential campaign last June, billionaire and presumptive Republican nominee Donald Trump has bashed a host of things, from people, to countries, to racial groups, to companies. While most of the companies have provoked his ire because of outsourcing, others have been criticized due to a variety of reasons. The interesting thing is that while Mr. Trump was criticizing these companies, he was also betting on a number of them by owning a stake in them, which was revealed in a recent regulatory filing. In this post, we will take a look at five prominent companies that Mr. Trump has bashed since launching his campaign and will discuss what the hedge funds in our database thought about those companies heading into the second quarter.
Through extensive research, we determined that imitating some of the picks of hedge funds and other institutional investors can help generate market-beating returns over the long run. The key is to focus on the small-cap picks of these investors, since they are usually less followed by the broader market and are less price-efficient. Our backtests that covered the period between 1999 and 2012, showed that following the 15 most popular small-caps among hedge funds can help a retail investor beat the market by an average of 95 basis points per month (see more details here).
Mr. Trump Lays Into Amazon.com, Inc. (NASDAQ:AMZN)
– Investors with long positions (as of March 31): 133
– Aggregate value of investors’ holdings (as of March 31): $14.70 billion
Let’s start with Amazon.com, Inc. (NASDAQ:AMZN), which has been continuously receiving flak from Mr. Trump. While giving a speech in Texas in February, Mr. Trump said that he has respect for Amazon’s founder and CEO, Jeff Bezos, but accused Mr. Bezos of buying the Washington Post “to have political influence.” Last month, Mr. Trump again lashed out at the Washington Post after reports surfaced that the newspaper had assembled a team of 20 reporters to dig into the real estate deals that Mr. Trump has done in the past. This time Mr. Trump accused Mr. Bezos and Amazon.com, Inc. (NASDAQ:AMZN) of using the Washington Post to influence lawmakers in Washington so that they “don’t tax Amazon like they should be taxed.” During the first quarter, the net ownership of Amazon among the funds in our system declined by eight while the aggregate value of their holdings in it dropped by 15.12%. However, the e-commerce giant was still the sixth-most popular company among the hedge funds that we track. Billionaire Andreas Halverson‘s Viking Global increased its stake in Amazon by 34% to 3.44 million shares during the first quarter.
Companies In Which Mr. Trump Has Invested (and Bashed)
Walt Disney Co (NYSE:DIS)
– Investors with long positions (as of March 31): 49
– Aggregate value of investors’ holdings (as of March 31): $3.09 billion
Mr. Trump criticized Walt Disney Co (NYSE:DIS) last year for replacing American workers with foreign ones and asked the company “to hire back every one of the workers they replaced.” He also stated that if he becomes President, he will never give H-1B visas to companies that fire American workers and replace them with foreigners. While he said that he had changed his hard-line view on the H-1B Visa while speaking at the GOP debate in March, within hours of the debate ending his campaign released a statement in which he again lashed out at the H-1B visa program for allowing “temporary foreign workers, imported from abroad, for the explicit purpose of substituting for American workers at lower pay.” According to his recent regulatory filing, Mr. Trump owns between $15,000 and $50,000 worth of the entertainment giant’s stock. The number of funds in our database that reported owning a stake in the company declined by two quarter-over-quarter as of March 31, while the aggregate value of their holdings in it shrank by $633 million. Jonathon Jacobson‘s Highfields Capital Management initiated a stake in Walt Disney Co (NYSE:DIS) during the first quarter, purchasing 1.63 million shares of the company.
Three more stocks that Mr. Trump has bashed are studied on the next page.