Editor’s note, related tickers: Apple Inc. (NASDAQ:AAPL), Priceline.com Inc (NASDAQ:PCLN)
We track quarterly 13F filings from hedge funds, including Tiger Cub hedge fund Tiger Global Management. There are a number of uses for this information. For one, we have found that 13Fs can be used to help develop investing strategies- for example, the most popular small cap stocks among hedge funds outperform the S&P 500 by 18 percentage points per year on average (learn more about our small cap strategy). We can also examine individual funds’ top picks in a number of areas, including those which have been in the portfolio for two years or longer, and treat these as initial ideas for further research. Read on for our quick take on the five largest holdings in Tiger Global’s portfolio as of the end of December which it had also had at least $10 million invested in at the end of 2010 (or see the full list of stocks the fund reported owning):
Tiger Global reduced its stake in Apple Inc. (NASDAQ:AAPL) by 19% during the fourth quarter of 2012, but at a little over 1 million shares that was still its largest holding by market value. Apple Inc. (NASDAQ:AAPL) lost its place as the most popular stock among hedge funds during Q4 to AIG (find more stocks hedge funds loved) and the stock is down 19% in the last year even as market indices have risen strongly. It is currently valued at 11 times its trailing earnings as the market expects its margins to continue to fall (in its most recent quarter, revenue was up compared to the same period in the previous fiscal year but earnings were down 18%).
The fund has consistently liked Mastercard Inc (NYSE:MA) for the past couple years, disclosing ownership of about 670,000 shares as of the end of December. Mastercard Inc (NYSE:MA) is another stock dependent on growth, with trailing and forward P/Es of 24 and 19 respectively. The credit card company’s numbers have been decent, with net income up 12% last quarter compared to the first quarter of 2012, though it would have to continue at that rate for some time in order to justify the current valuation. Viking Global, managed by billionaire Andreas Halvorsen, was another major shareholder in Mastercard Inc (NYSE:MA) (research more stocks Viking owns).
According to the 13F, Tiger Global more than doubled the size of its position in Amazon.com, Inc. (NASDAQ:AMZN) between October and December to a total of 1.2 million shares. Talk about a growth stock: Amazon is actually unprofitable on a trailing basis, but its market cap is $120 billion as the market expects the company to eventually convert its large and growing revenue into earnings. We’d still think that it’s a bit too speculative for us to recommend investing in. Billionaire Ken Fisher’s Fisher Asset Management owned 2.4 million shares of Amazon at the beginning of 2013 (see Fisher’s favorite stocks).
Tiger Global included Visa Inc (NYSE:V) along with Mastercard as credit card stocks of which it has been a long term shareholder. Visa Inc (NYSE:V) has risen 53% in the last year, more than doubling the performance of the S&P 500, though this has led to it being valued at a premium to its best known peer; it currently trades at 21 times forward earnings estimates. Net income was down a bit in the first quarter of 2013 versus a year earlier despite a 15% rise in revenue. Discovery Capital Management, which is run by fellow Tiger Cub Rob Citrone, owned 2.2 million shares.
Disclosure: I own no shares of any stocks mentioned in this article.
