Bearish on China, EU, George Soros is Back Trading; See What His Family Office Was Buying in Q1

Legendary speculator and billionaire George Soros has returned to active trading after a long hiatus. The last time ‘the man who broke the Bank of England’ actively participated in the investment decision-making process at his family office, Soros Fund Management, was way back in 2007, when he placed bets against the housing market and made $1 billion in profits. According to the Wall Street Journal, one of the reasons that pushed Mr. Soros to become active in the markets again was the departure of Soros Fund Management’s former CIO, Scott Bessent, who left last year to start his own hedge fund. Over the last few months, Mr. Soros has been quite vocal about his bearishness on China and the repercussions that will result in the global economy due to the upheaval in the Chinese economy. He has also been taking large bets on gold and gold mining companies as a hedge against turmoil in the equities market. In this article we will take a look at five stocks that Soros Fund Management was buying shares of ahead of the second quarter and discuss how they have been performing of late.

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#5. Crown Castle International Corp (NYSE:CCI)

 – Shares owned by Soros Fund Management (as of March 31): 354,519

 – Value of holding (as of March 31): $30.66 Million

Let’s start with Crown Castle International Corp (NYSE:CCI), which Soros Fund Management initiated a stake in during the first quarter. Shares of the Texas-based real estate investment trust (REIT) have appreciated by 9.74% in 2016, with nearly all of those gains coming in the last two months. The REIT currently pays a quarterly dividend of $0.88 per share, which based on its current market price, translates into an attractive annual dividend yield of 3.75%. Soros Fund Management was one of many funds that initiated a stake in Crown Castle International Corp (NYSE:CCI) during the first quarter. During that period, the ownership of the REIT among the funds tracked by Insider Monkey increased to 47 from 38 and the aggregate value of their holdings in it also saw an increase of almost 10%. Funds that boosted their stake in Crown Castle International included Jim Simons‘ Renaissance Technologies, which upped its holding by 168% to 2.07 million shares.

#4. JD.Com Inc(ADR) (NASDAQ:JD)

 – Shares owned by Soros Fund Management (as of March 31): 1.3 Million

 – Value of holding (as of March 31): $34.36 Million

While Mr. Soros has been quite bearish on China, his family office increased its holding in Chinese e-commerce firm JD.Com Inc(ADR) (NASDAQ:JD) by 56% during the first quarter. Since the start of 2016, JD.Com Inc(ADR) (NASDAQ:JD) has lost nearly one-third of its market value. Shares of the company took a big hit on June 7 after a report published on SumZero called the company “wildly overpriced”. JD.Com Inc(ADR) reported mixed first quarter numbers recently. While the company’s loss of $0.02 per share was in-line with analysts’ consensus expectation, its revenue of $8.23 billion missed projections by nearly $40 million. Chase Coleman‘s Tiger Global Management reduced its stake in the company by 27% to 44.00 million shares during the first quarter.

Three more stocks that Soros Fund Management was buying during the first quarter are examined on the next page.

#3. Ferrari N.V. (NYSE:RACE)

 – Shares owned by Soros Fund Management (as of March 31): 850,000

 – Value of holding (as of March 31): $35.44 Million

Ferrari N.V. (NYSE:RACE) made its debut on the NYSE in early-January after its spin-off from Fiat Chrysler Automobiles NV (NYSE:FCAU) was completed. Since making its debut, shares of the iconic car brand have lost 8.21% of their value. However, they have been mostly stable in the last three months, trading within the $40-to-$45 range. Though the stock is trading at a reasonable valuation, some analysts are worried about the company’s financial health and are advising investors interested in buying the stock to bide their time. On April 19, analysts at JPMorgan Chase & Co. reiterated their ‘Neutral’ rating on the stock, but upped their price target on it to $51 from $46, which represents potential upside of 17.2%.

#2. Equinix Inc (NASDAQ:EQIX)

 – Shares owned by Soros Fund Management (as of March 31): 206,215

 – Value of holding (as of March 31): $68.2 Million

Soros Fund Management increased its stake in Equinix Inc (NASDAQ:EQIX) by 112% during the first quarter, making the company its sixth-largest stock holding at the end of that period. This move by the fund has quickly paid off, as shares of the data centers company have been on fire for the past several weeks and currently trade up by 23.42% year-to-date. Last month, the company announced that it has agreed to sell eight of its data centers in Europe to Digital Realty Trust, Inc. (NYSE:DLR) for $874 million. Under the terms of the deal, Equinix Inc (NASDAQ:EQIX) was also given an option to buy DLR’s data center in Paris for $125 million. Most analysts who track Equinix are bullish on it, including analysts at Canaccord Genuity, who on May 23 reiterated their ‘Buy’ rating on the stock, while upping their price target on it to $390 from $370. Billionaire Stephen Mandel‘s Lone Pine Capital also increased its stake in Equinix during the first quarter, by 11% to 2.32 million shares.

#1. Barrick Gold Corporation (USA) (NYSE:ABX)

 – Shares owned by Soros Fund Management (as of March 31): 1.92 Million

 – Value of holding (as of March 31): $181.32 Million

Barrick Gold Corporation (USA) (NYSE:ABX) became Soros Fund Management ‘s top stock pick at the end of March, with the fund having initiated a massive stake in the company during the first quarter. The rise in gold prices this year has ignited a rally in Barrick Gold Corporation (USA) (NYSE:ABX)’s stock, which doesn’t seem poised to end any time soon. The stock has appreciated by a whopping 165% in 2016 and is currently trading very close to its 52-week high of $19.73. According to a report published by SNL Metals & Mining on June 9, Barrick Gold Corporation was the lowest cost-producer of gold in the first quarter, with an all-in sustaining cost of $706/ounce, significantly below the industry median of $836/ounce. The stock currently sports an average rating of ‘Overweight’ and an average price target of $22.20 from the 28 prominent analysts and research firms who track it. Another fund that initiated a stake in the gold miner during the first quarter was Bruce Kovner‘s Caxton Associates, which purchased 11.57 million shares of it.

Disclosure: None