Highbridge Capital Management: Five Important Moves During Q1

Glenn Russell Dubin’s Highbridge Capital Management, has recently presented its Form 13F Filing for the first quarter of 2014 at the U.S. Securities and Exchange Commission. Over the three months ending on March 31, the fund started some 470 new positions, increased its stakes in more than 230 of its preexisting holdings, and sold out of around 480. In this article, I will take a look at five of Mr. Russell’s most important moves during the first quarter.

HIGHBRIDGE CAPITAL MANAGEMENT

Highbridge’s focus on services, technology and healthcare stocks continued through the first quarter, with services stocks accounting for more than 19% of its portfolio’s value, services, more than 18%, and healthcare, about 17%. One of his bets on tech is placed on Intel Corporation (NASDAQ:INTC), a $129 billion market cap semiconductor chip maker that develops integrated digital technology products. Over Q1, the fund increased its position in the stock by 1,200%, and now owns about 2.35 million shares, worth more than $60 million.

Aside from Highbridge among shareholders of  Intel Corporation (NASDAQ:INTC) are Harris Associates (Natixis Global Asset Management), which owns 66.86 million shares, worth about $1.73 billion, and Jean-Marie Eveillard’s First Eagle Investment Management’s, with 38 million shares, up 8% in relation to Q4 2013. I should also mention that Clint Carlson’s Carlson Capital also started, during the first three months of the year, a position in Intel Corporation (NASDAQ:INTC), worth more than $100 million.

The second company in this list is Kinder Morgan Inc (NYSE:KMI), a $34.3 billion market cap energy transportation and storage company. Russell increased his position in the stock by 45% over the last reported quarter, and now holds 1.835 million shares, worth more than $60 million.

However, two of the company’s largest hedge fund shareholders, Stephen Mandel and Barry Rosenstein, who owned 69.9 million and 15.5 million shares, respectively, closed out their positions in Kinder Morgan Inc (NYSE:KMI) lately. On the other hand, D E Shaw last declared having upped its bets on Kinder Morgan Inc (NYSE:KMI) by 349%, to more than 6 million shares, worth roughly $200 million.

Next is Facebook Inc (NASDAQ:FB), a $152 billion market cap social networking company that needs no introduction. Unlike in the previous cases, Highbridge cut its exposure to this stock –by 48%. The fund now holds 972,348 shares of the company, worth more than $57 million. Another fund that also -substantially- reduced its stake in Facebook Inc (NASDAQ:FB) is Rob Citrone’s Discovery Capital Management: which sold 6.49 million shares over Q4, and now owns 2.73 million shares of Facebook Inc (NASDAQ:FB).

Back to bullish moves, a couple more are worth mentioning; those of PepsiCo, Inc. (NYSE:PEP) and The Procter & Gamble Company (NYSE:PG), two non-cyclical consumer goods behemoths. Highbridge slightly upped its stakes in both companies over Q1 and now owns about $60 million in PepsiCo, Inc. (NYSE:PEP)’s stock, and $55 million in The Procter & Gamble Company (NYSE:PG)’s stock. Another fund that is betting big on both these companies is Donald Yacktman’s Yacktman Asset Management, which owns more than $2 billion worth of each company’s stock.

Highbridge Capital Management is a New York based hedge fund with around $29 billion in assets under management, and an equity portfolio worth roughly $8 billion. In late 2004, J.P. Morgan Asset Management acquired a majority interest in the fund, giving birth to one of the first and most significant strategic alliances in the hedge fund industry. In July 2009, J.P. Morgan completed its purchase of almost all of the remaining shares.

Disclosure: Javier Hasse holds no position in any stocks mentioned.

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