Altimeter Capital Management’s Top Picks Include Online Travel and Airline Stocks

Brad Gerstner’s Altimeter Capital Management boasted an equity portfolio worth $1.34 billion at the end of the second quarter, according to the fund’s last 13F filing, which also showed that the fund had its primary investments in service and technology sectors. 2016 hasn’t been the most favorable year for Altimeter Capital. According to our methodology, which calculates the weighted average return of  especially with 14 of its stock positions in companies’ worth over $1 billion losing 16% in the June quarter and 13.2% year-to-date. Despite the dismal performance of these stocks, the equity portfolio of the investment firm grew 1% during the quarter.

In this article, we’ll discuss the top stock picks of Altimeter Capital Management at the end of the second quarter, and how these stocks have performed of late.

At Insider Monkey, we track around 750 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on, can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see the details here).

Alaska Air Group, Inc. (NYSE:ALK)

– Share held by Altimeter Capital (as of June 30): 902,489

– Value of Altimeter Capital’s stake (as of June 30): $52.61 million

Alaska Air Group, Inc. (NYSE:ALK) ranks fifth in Altimeter Capital’s equity portfolio, accounting for 3.91% of its portfolio value. The investment firm’s stake has remained unchanged from the last quarter. Jim Simons’ Renaissance Technologies is the largest stockholder of Alaska Air Group, Inc. (NYSE:ALK) in our database, with 3.17 million shares worth over $184.02 million. Alaska Air Group, Inc. (NYSE:ALK) has done fairly well in the third quarter, with its share prices growing 15.27% since June 30, but the stock still remains down by 17.4% year-to-date. The stock gained momentum earlier this month after reporting positive August and year-to-date operational results.

Ctrip.com International, Ltd. (ADR) (NASDAQ:CTRP)

– Share held by Altimeter Capital (as of June 30): 1.29 million

– Value of Altimeter Capital’s stake (as of June 30): $53.03 million

The Chinese travel service provider is the fourth largest stock holding of Altimeter Capital management. The investment firm has made no changes in its stake in Ctrip.com International, Ltd. (ADR) (NASDAQ:CTRP) from the last quarter. Ken Fisher’s Fisher Asset Management is among the largest stockholders of the company, owning 9.82 million shares valued at $410.07 million as of the end of June. Ctrip.com International, Ltd. (ADR) (NASDAQ:CTRP) announced its second quarter 2016 financial results on August 31. The company reported net revenues of $664 million, up by 75% year-on-year. However, its bottom line dropped to a loss of $0.17 against earnings of $0.02 in the prior year quarter. The shares of Ctrip.com International, Ltd. (ADR) (NASDAQ:CTRP) have dropped by 6.26% year-to-date.

Tableau Software Inc (NYSE:DATA)

– Share held by Altimeter Capital (as of June 30): 1.45 million

– Value of Altimeter Capital’s stake (as of June 30): $70.98 million

Altimeter Capital Management is the second largest stockholder of Tableau Software Inc (NYSE:DATA) in our database, while Cadian Capital has emerged as the top stakeholder of Tableau Software Inc (NYSE:DATA) at the end of the second quarter, with a new position of 2.59 million shares worth $126.88 million. Tableau Software Inc (NYSE:DATA) appointed Adam Selipsky as its new CEO effective September 16, replacing Christian Cabot, co-founder and previous CEO of the company. The software firm has had a rough year, with its share price dropping by 42% year-to-date.

United Continental Holdings Inc (NYSE:UAL)

– Share held by Altimeter Capital (as of June 30): 11.51 million

– Value of Altimeter Capital’s stake (as of June 30): $472.34 million

United Continental Holdings Inc (NYSE:UAL) comes on the second spot in Altimeter Capital’s equity portfolio, the position amassing 35.17% of its portfolio value at the end of the June quarter. A total of 57 funds in our database were long the Airline Operator at the end of previous quarter, with Citadel Investment Group and Omega Advisors holding major stakes in the company, 4.30 million shares valued at $176.37 million and 2.37 million shares valued at $97.12 million, respectively. The shares of United Continental Holdings Inc (NYSE:UAL) have lost 10.45% value year-to-date.

Expedia Inc (NASDAQ:EXPE)

– Share held by Altimeter Capital (as of June 30): 4.50 million

– Value of Altimeter Capital’s stake (as of June 30): $478.15 million

Expedia Inc (NASDAQ:EXPE) was the top stock position of Altimeter Capital management at the end of the June quarter. The investment advisory buffed its stake in the online travel company by 19% during the second quarter. A total of 67 funds that we track were long on the stock, with Tourbillon Capital Partners and JANA Partners leading the list. Tourbillon Capital Partners owned 3.14 million shares of the company with a value of $333.38 million at the end of June, while JANA initiated a stake in Expedia Inc (NASDAQ:EXPE) during the second quarter, holding 2.07 million shares valued at $219.96 million, according to its last 13F filing. Expedia Inc (NASDAQ:EXPE) has announced global coordinators, JP Morgan, Goldman Sachs and Morgan Stanley, for its planned IPO of Trivago, travel search site owned by the company. The shares of the online travel company have lost 11.86% since the beginning of the year.

Disclosure: none