We have been going through our database of 13F filings for the fourth quarter of 2012. These filings disclose many long equity positions held by a hedge fund or other major investor at the end of a quarter and can be of multiple uses to investors. For one, the most popular small cap stocks among hedge funds have outperformed the S&P 500 by an average of 18 percentage points per year according to our research. Read more about our small cap strategy. It’s also potentially helpful to use 13Fs as an initial source of ideas for further research. Maverick Capital was founded by Lee Ainslie after a short stint at legendary investor Julian Robertson’s Tiger Management. Read on for our quick take on Maverick’s five largest holdings by market value at the end of December according to the 13F or see the full list of Ainslie’s stock picks.
The fund owned 7.5 million shares of Macy’s, Inc. (NYSE:M) at the beginning of 2013. The retailer recently reported decently higher earnings per share for the fiscal quarter ending in January compared to the same period in the previous fiscal year, with results beating analyst expectations. Consensus among the sell-side is that Macy’s is a good value, with the stock trading at 9 times expected earnings for the fiscal year ending in January 2014 and a five-year PEG ratio of 0.8. Cliff Asness’s AQR Capital Management liked Macy’s in the fourth quarter, increasing its stake by 38% (check out more stocks AQR was buying).
Maverick owned about 540,000 shares of Apple Inc. (NASDAQ:AAPL) according to the 13F. A number of hedge funds were selling Apple Inc. (NASDAQ:AAPL) during the fourth quarter of 2012, and as a result it was no longer the most popular stock among hedge funds when we processed the 13Fs. Find more of the most popular stocks among hedge funds. The stock’s forward P/E of 9 is actually even with that of Microsoft Corporation (NASDAQ:MSFT), as the market is anticipating a decline in earnings as gross margins fall. We aren’t expecting any more high growth from Apple Inc. (NASDAQ:AAPL) but it does look like a good value.
Ainslie also liked another tech company: