Herbalife’s Shorts — Hey Bill Ackman! — May Be Twisting in the Wind Soon (TheStreet)
Argus’s downgrade of Herbalife Ltd. (NYSE:HLF)‘s is not as bad as you’d think. Argus, an independent analyst, lowered Herbalife’s rating to a hold from a buy following the recently announced Federal Trade Commission investigation into the health supplement, multi-level marketing company. Argus’s retreat from its bull thesis on Herbalife is based, in part, on a negative shift in market sentiment. Argus has a point: The company’s headline peril is far from imaginary, but maybe Argus’ timing is more “a dollar short and a day late” than clairvoyance. Even Argus states its expected earnings multiple is in single digits.
CB Fonder closes CB Hedge (InvestmentEurope)
Stockholm based CB Fonder has announced the closure of its CB Hedge fund, citing returns that have not met expectations, as well as increasing regulatory costs. CB Hedge is a long-short hedge fund that launched in mid-2007, intended to offer clients access to a market neutral exposure to the existing long only European fund CB European Quality. The closure of the fund means the manager will focus on its long only funds including the European Quality product and the CB Save Earth Fund.
A Pension Fund Invests Against the Rules, and Wins (NYTimes)
Are the trustees of the Tampa firefighters and police officers pension fund out of their minds? “Quite a few people tell me we’re crazy,” Richard Griner, a 41-year-old Tampa police detective and member of the pension fund’s board, told me this week. “I go to quite a few investment conferences. They just can’t believe that we do this the way we do. But then I tell them the numbers, and they tend to shut up.” The Tampa, Fla., pension fund may be unique in its approach to managing its assets, which totaled $1.76 billion as of last September. Unlike the so-called Yale model, which has been widely copied and stresses alternative investments, the Tampa fund has no hedge fund or private equity investments.
Can George Soros Get a Fair Deal for Penn Virginia Corp.? (Fool)
After George Soros increased his ownership stake in Penn Virginia Corporation (NYSE:PVA) to 9.2%, in addition to taking an active role in the oil and natural gas producer, shares soared higher. Soros expressed interested in exploring strategic alternatives for Penn Virginia, one of which would be selling the company and its valuable Eagle Ford assets in Texas. How well could this strategy pan out for Soros? If Halcon Resources Corp (NYSE:HK) teaches us anything, unloading shale assets is difficult when Big Oil is sitting on the sidelines.
How Carl Icahn Wins at Losing (InstitutionalInvestorsAlpha)
News that eBay Inc (NASDAQ:EBAY) is planning to sell 20 percent of PayPal rather than extricate the online payment company from the parent altogether is yet another example of a technology company essentially blowing off Carl Icahn. EBay is the fourth tech or media giant in roughly 18 months to refuse to capitulate to the septuagenarian investor and onetime corporate raider. The other three are Apple Inc. (NASDAQ:AAPL), which refused to execute a gargantuan stock buyback; Dell Inc. (NASDAQ:DELL), which ignored Icahn and completed its management buyout; and Netflix, Inc. (NASDAQ:NFLX), which refused to put itself up for sale. Now EBay has rejected Icahn’s urging to spin off or break off PayPal after earlier rejecting the two individuals Icahn nominated to its board of directors.
Why Africa is the next frontier for fund investors (Reuters)
It only took a look at the financial statements of the world’s largest maker of spirits to convince Larry Seruma that Africa was the place to go. Seruma was then running a long-short hedge fund and had a position in Diageo plc (ADR) (NYSE:DEO), the company behind the Johnnie Walker, Guinness and Captain Morgan brands. While African alcohol consumption lagged Europe or the Americas, Diageo’s rapid expansion on the continent was such that, by 2013, the region accounted for 13 percent of global revenue. “Africa accounted for its most profitable business lines and a high-growth, high-return opportunity,” Seruma said.
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