John Burbank and Passport Capital’s Amazingly Successful New Stock Picks

Passport Capital’s John Burbank is famous for having predicted the subprime crisis. Passport’s flagship fund returned 219% in 2007. Burbank bet against the US housing market at the end of 2005. He was very skeptical about US equities so he also invested in emerging markets and commodities. These bets backfired in 2008. In a matter of few months, his funds lost more than 50%. Passport I, L.P. gained 23% in 2005, 14% in 2006, 220% in 2007, and then lost 51% in 2008. Burbank trailed the S&P 500 index in 2009, returning only 19%. In 2010, Passport Capital returned 18.3%, beating the SPY.

John Burbank PASSPORT CAPITAL

Burbank maintains a long bias in his portfolios as one can guess from his returns. Instead of investing in highly liquid and well-researched developed markets, he prefers investing in under-researched companies in fast growing developing markets. This helped Burbank achieve 23% annual returns since 2000.  This is how Passport describes its investment focus:

“Passport Capital LLC is a San Francisco based, global investment firm founded by John H. Burbank III in 2000. The firm manages approximately $4.1 billion in assets.  Passport’s investment process uses a combination of macroeconomic analyses to develop major themes and rigorous fundamental research on individual companies to create global portfolios.  The firm’s investment team focuses on the following areas: Agriculture, Basic Materials, Consumer, Energy, Financial Services, Healthcare, India & Capital Markets, Internet / Technology, and Middle East & North Africa.”

During the fourth quarter Burbank started using put options on several SPDR sector ETFs, including Materials, Retail, and Industrials. He also shorted MSCI Emerging Market ETF (EEM), Powershares’ QQQQ, Russell 2000 ETF (IWM), and SPY using put options. It’s clear Burbank uses put options on the broad market indices and sector ETFs to hedge his positions.

Insider Monkey, your source for free insider trading data, will compare Burbank’s 13F portfolio returns to his actual returns.

Burbank’s biggest new stock purchase is a $81 Million Apple (AAPL) position initiated by using call options. With this purchase, he joins Lee Ainslie, David Einhorn, George Soros,  Jim Simons, Dan Loeb, Andreas Halvorsen, Joseph DiMenna, Chase Coleman, Stephen Mandel, Barry Rosenstein, and Craig Effron. John Burbank also initiated a $61 Million Cisco (CSCO) position using stocks and call options. David Tepper’s Appaloosa and Leon Cooperman’s Omega Advisors are other hedge funds with Cisco positions.

Here are Burbank’s other large new or significantly increased positions:

Company Ticker Return Value (Million)
UNITED STATES STEEL CORP X 8.5% 80
CYTEC INDUSTRIES INC CYT 8.2% 73
APPLE COMPUTER INC AAPL 12.6% 51
MONSANTO CO MON 5.2% 45
WENDY’S/ARBY’S GROUP INC-A WEN 8.2% 37
ATMEL CORP ATML 27.5% 34
BARCLAYS BK PLC BCS 29.2% 31
HANSEN NATURAL CORP HANS 9.5% 30
BLACKROCK INC BLK 7.7% 30
MASTERCARD INC-CLASS A MA 13.6% 29
TRANSOCEAN LTD. RIG 15.8% 28
ROCKWELL AUTOMATION INC ROK 27.4% 27
POTASH CORP POT 19.9% 25
ALCON INC ACL 0.9% 22
VIACOM INC-CLASS B VIA 13.1% 22
VULCAN MATERIALS CO VMC 2.4% 22
CHEMTURA CORP CHMT 9.6% 21
CISCO SYSTEMS INC CSCO -8.2% 21
VODAFONE GROUP PLC-SP ADR VOD 12.1% 20
SANDRIDGE ENERGY INC SD 22.5% 20
WATSON PHARMACEUTICALS INC WPI 9.3% 20
CLIFFS NATURAL RESOURCES INC C CLF 19.2% 19
SUNCOR ENERGY INC SU 15.1% 19
DENDREON CORP DNDN -2.5% 19
ANHEUSER-BUSCH INBEV SPN ADR BUD -3.7% 19
ALLERGAN INC AGN 9.0% 19
RESEARCH IN MOTION RIMM 17.6% 18

 

John Burbank’s new stock purchases performed spectacularly, returning 11.5% vs. SPY’s 6.4% since the end of December.

Thirteen of his top fourteen picks managed to beat the SPY, which is very impressive. He has a lot of underfollowed stocks in his portfolio. One popular stock in his portfolio is Potash. David Einhorn’s Greenlight, Thomas Steyer’s Farallon Capital, Jim Simons’ Renaissance, Dan Loeb’s Third Point, Andreas Halvorsen’s Viking Global, Richard Perry’s Perry Capital, and Mohnish Pabrai have large Potash investments.

We are also curious about the performance of John Burbank’s top 30 long positions. Here are his top stock holdings:

Company Ticker Return Value (Million)
UNITED STATES STEEL CORP X 8.5% 80
CYTEC INDUSTRIES INC CYT 8.2% 73
CISCO SYS INC CSCO -8.2% 61
APPLE COMPUTER INC AAPL 12.6% 51
SUNCOR ENERGY INC SU 15.1% 50
CLIFFS NATURAL RESOURCES INC CLF 19.2% 49
MONSANTO CO MON 5.2% 45
WENDY’S/ARBY’S GROUP INC-A WEN 8.2% 37
ATMEL CORP ATML 27.5% 34
WALTER INDUSTRIES INC WLT -0.8% 32
BARCLAYS BK PLC BCS 29.2% 31
HANSEN NATURAL CORP HANS 9.5% 30
BLACKROCK INC BLK 7.7% 30
MASTERCARD INC-CLASS A MA 13.6% 29
TRANSOCEAN LTD. RIG 15.8% 28
ROCKWELL AUTOMATION INC ROK 27.4% 27
CUMMINS INC         COM CMI 1.1% 25
POTASH CORP POT 19.9% 25
ALCON INC ACL 0.9% 22
VIACOM INC-CLASS B VIA 13.1% 22
VULCAN MATERIALS CO VMC 2.4% 22
AK STEEL HOLDING AKS 3.2% 21
CHEMTURA CORP CHMT 9.6% 21
VODAFONE GROUP PLC-SP ADR VOD 12.1% 20
SANDRIDGE ENERGY INC SD 22.5% 20
WATSON PHARMACEUTICALS INC WPI 9.3% 20
HSN INC HSNI -2.2% 19
DENDREON CORP DNDN -2.5% 19
ANHEUSER-BUSCH INBEV SPN ADR BUD -3.7% 19
ALLERGAN INC AGN 9.0% 19

 

Burbank’s top 30 stock holdings returned 9.8% so far in 2011, vs. SPY’s 6.4%. Fifteen of his top 20 holdings managed to beat the SPY. It seems Burbank’s focus on under-researched companies is paying off handsomely.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

Qihoo 360 Technology Co Ltd (QIHU), Actavis plc (ACT), Yahoo! Inc. (YHOO) Among 20 Long Ideas from Sohn Canada

The 10 Laziest Countries in the World

The 10 Most Polluted Countries in the World

The 10 Most Dangerous Cities in America 2014

The Top 10 Gold Producing Countries in the World

The 10 Tallest Buildings in the World

The 10 Richest Stand Up Comedians in the World

The 10 Fattest Countries in the World

The 5 Best Summer Jobs for Teens

The 10 Most Religious Countries in the World Keeping the Faith

The 10 Most Educated Countries in the World

The 10 Most Popular Cell Phones in the World

The 10 Drunkest Countries in the World

The 10 Most Expensive Private Schools in the World

The 10 Smallest Countries in the World

Walking Dead Season 5 Spoilers You’ll Wish You Didn’t Know

The 10 Poorest Countries in the World

The 10 Greenest Countries in the World

The Top 10 Countries with the Highest Population in the World

The 10 Most Visited Countries in the World

The Top 10 Star Wars Characters in the Iconic Series

The 10 Most Expensive Android Phones in the World

5 Reasons Why The Illuminati Is Real and a Threat to Society

The 6 Scariest Halloween Costumes Ever Screamed At

The 4 Biggest Hedge Fund Managers in the World Today

The 15 Most Densely Populated Countries in the World

The 10 Biggest Tea Drinking Countries in the World

Top 6 Ways to Improve Your Checkout Process and Close Sales

The 5 Most Profitable Online Businesses You Can Start Today

The 20 Most Profitable Hospitals in the US

The 5 Most Profitable Home Businesses to Start

The 7 Teams that Will Win the Stanley Cup in 2015

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!