Several weeks after the end of each quarter, hedge funds and other notable investors file 13Fs with the SEC to publicly disclose many of their long equity positions as of the end of the quarter. We maintain a database of these filings over time, which we use to develop investment strategies (we have found, for example, that the most popular small cap stocks among hedge funds generate an average excess return of 18 percentage points per year). We can also use 13Fs as a source of free investment ideas from top fund managers including billionaire and Tiger Cub Andreas Halvorsen of Viking Global. We have gone through the fund’s most recent 13F (see a history of Viking’s 13F filings) and here are our thoughts on its five largest holdings as of the end of March:
Halvorsen and his team disclosed ownership of over 22 million shares of Time Warner Inc (NYSE:TWX) in the filing. The media and entertainment company is up 75% in the last year, in what has been a good time for the industry as a whole. Carrying trailing and forward earnings multiples of 18 and 14, respectively, Time Warner Inc (NYSE:TWX) is dependent on future earnings growth and recent improvements seem to have been entirely due to higher net margins (which we’d worry may not be a sustainable source of growth). Billionaire Ken Griffin’s Citadel Investment Group has been another major shareholder in Time Warner Inc (NYSE:TWX) (check out Griffin’s stock picks).
Viking Global bought over 12 million shares of The Boeing Company (NYSE:BA) between January and March after not having owned any shares of the aircraft manufacturer in its previous filing. The Boeing Company (NYSE:BA) seems to have gotten over problems with its new Dreamliner aircraft, and its stock has actually outpaced the S&P 500 over the last year. Similarly to Time Warner, The Boeing Company (NYSE:BA) trades at 18 times its trailing earnings and, while net income did rise over 20% in the first quarter of 2013 versus a year earlier, did not show as strong a performance on the top line.