Coatue increased its stake in Apple Inc. (NASDAQ:AAPL) by 88% between January and March, closing the quarter with 1.2 million shares in its portfolio. During the first quarter of the year, Apple Inc. (NASDAQ:AAPL) regained its place as the most popular stock among hedge funds, which it had lost in late 2012 (find more of hedge funds’ favorite stocks). Currently Apple Inc. (NASDAQ:AAPL) is valued at only 11 times its trailing earnings, with a good deal of its market cap being in the form of cash. While net income has been declining, we would watch to see if the business can stabilize and make the stock a value play.
Liberty Global Inc. (NASDAQ:LBTYA), which recently merged with another of Laffont’s top picks, Virgin Media, also had a prime place in the 13F filing. Following a 65% rise in the stock price over the last year, analyst expectations for 2014 imply a forward P/E of 25; the sell-side expects considerable earnings growth over the next several years, and as a result the five-year PEG ratio is less than 1. There has been high short interest in Liberty Global Inc. (NASDAQ:LBTYA), though this is a common component of a merger arbitrage strategy.
Still, we would avoid Liberty Global Inc. (NASDAQ:LBTYA) at least for now. Equinix Inc (NASDAQ:EQIX) also seems a bit pricy at least going by recent earnings performance. We’ve mentioned that Apple Inc. (NASDAQ:AAPL) may be a bit uncertain at this time, but the cheapness of the stock in terms of trailing performance, as well as the large cash hoard, means that a good deal of bad news is already priced in. The media companies we’ve mentioned here, as well as their peers, are certainly not pure value plays but have been doing well recently and may be worth a closer look.
Disclosure: I own no shares of any stocks mentioned in this article.