Billionaire Chase Coleman’s Tiger Global Management Is Betting Big On These Stocks

Taking into account that the broader market went nowhere last year and most large hedge funds suffered huge losses during that period, 2015 was a fine year for Chase Coleman‘s Tiger Global Management LLC. According to our calculations, the 27 long positions the fund held in companies with market caps over $1 billion during 2015 delivered a weighted average return of 1.7%. Since we don’t include the short positions of a fund, its investments in bonds, or other instruments, the actual return might differ from our estimates. According to the fund’s recently submitted 13F filing with the SEC, its US equity portfolio was worth $12.44 billion at the end of December, 53% more than the $8.12 billion that it was worth at the end of September. In this post, we will be analyzing the fund’s top five stock picks, which alone accounted for over 65% of the value of its equity portfolio at the end of December.

We determine hedge fund sentiment by analyzing the equity portfolios of some of the best-performing hedge funds and institutional investors. Through extensive research, we have determined that the due diligence that these investors employ, as well as their long-term focus makes them the perfect targets to emulate (see the details here).

#5 Priceline Group Inc (NASDAQ:PCLN)

– Shares Owned by Tiger Global Management LLC (as of December 31): 758,389

– Value of Holding (as of December 31): $966.9 million

Priceline Group Inc (NASDAQ:PCLN) was a new entrant in Tiger Global Management LLC’s equity portfolio during the fourth quarter. Although shares of the company embarked on a downtrend in November after it reported its third-quarter results and continued the same trajectory this year, they spiked in anticipation of Priceline Group Inc (NASDAQ:PCLN)’s fourth quarter results and following the earnings release are now trading down only 3% year-to-date. Backed by a large increase in travel bookings during the quarter, on February 17, Priceline Group reported EPS of $12.63 on revenue of $2.00 billion, versus analysts’ projections of EPS of $11.81 on revenue of $1.96 billion. Stephen Mandel‘s Lone Pine Capital reduced its stake in Priceline Group by 15% to834,421 shares during the fourth quarter.

#4 Apple Inc. (NASDAQ:AAPL)

– Shares Owned by Tiger Global Management LLC (as of December 31): 10.6 million

– Value of Holding (as of December 31): $1.15 billion

Apple Inc. (NASDAQ:AAPL) was another company in which Tiger Global Management LLC initiated a stake during the fourth quarter. Amid a 4.5% decline in Apple Inc. (NASDAQ:AAPL)’s stock during the quarter, the number of billionaire investors covered by us with a stake in the company declined by one to 17. Though shares of the company are currently trading at a very low forward price-to-earnings multiple of 9.65, fears of a decline in revenue and a downturn in China, its second biggest market, have made investors wary of buying the stock in the past few months. The company recently raised $12 billion from the debt markets for “general corporate purposes”, despite having over $216 billion in cash, because most of its cash is stashed abroad and it will have to pay a large amount in taxes if it brings it back to the US. Billionaire David Einhorn‘s Greenlight Capital reduced its stake in Apple by 44% to 6.28 million shares during the fourth quarter.

#3 JD.Com Inc (ADR) (NASDAQ:JD)

– Shares Owned by Tiger Global Management LLC (as of December 31): 59.62 million

– Value of Holding (as of December 31): $1.92 billion

Tiger Global Management increased its stake in JD.Com Inc (ADR) (NASDAQ:JD) by 3% during the fourth quarter. The company was among the best performing large cap Chinese stocks during the fourth quarter with its shares appreciating by nearly 24% during that period. However, amid a meltdown in Chinese equities this year, JD.Com Inc (ADR) (NASDAQ:JD) has given up all of those gains and currently trades down 20% year-to-date. The company is scheduled to report its fourth-quarter earnings early next month and analysts are expecting a loss of $0.12 per share on revenue of $51.93 billion. For the same quarter of the previous year, the company had reported a per share loss of $0.01 on revenue of $5.60 billion. On January 22, analysts at Nomura upgraded the stock to a ‘Buy’ from ‘Neutral’ and also raised their price target to $35 from $27.

#2 Netflix, Inc. (NASDAQ:NFLX)

– Shares Owned by Tiger Global Management LLC (as of December 31): 18 million

– Value of Holding (as of December 31): $2.06 billion

Tiger Global Management didn’t make any changes to its stake in Netflix, Inc. (NASDAQ:NFLX) during the fourth quarter and its stock rose by 11.3% during the same period. Even though last year was amazing for Netflix, Inc. (NASDAQ:NFLX) with its stock climbing over 125%, this year hasn’t started on a favorable note as the stock has declined by 17% year-to-date. Due to the excessive valuation the stock is trading at, rising content costs, in addition to the high level of debt and weakness in credit markets, several analysts feel that it can fall further in the next couple of months. On February 12, analysts at FBR & Co. downgraded the stock to ‘Market Perform’ from ‘Outperform’ and also reduce their price target by 20% to $100. After having initiated a stake in Netflix during the third quarter, Andreas Halvorsen’s Viking Global increased it by 73% to 7.84 million shares during the October-December period.

#1 Amazon.com, Inc. (NASDAQ:AMZN)

– Shares Owned by Tiger Global Management LLC (as of December 31): 3.2 million

– Value of Holding (as of December 31): $2.16 billion

The 32% rise in Amazon.com, Inc. (NASDAQ:AMZN)’s stock during the fourth quarter propelled the company to the top spot in Tiger Global Management’s equity portfolio at the end of December, while the fund kept its stake unchanged. Amazon.com, Inc. (NASDAQ:AMZN)’s stock surged by some 125% during 2015, but has lost 21% year-to-date. However, analysts optimistic on Amazon.com mainly because of the strong results reported for the fourth quarter, which was the third quarter in a row when Amazon.com reported a profit with EPS of $1.00, its quarterly revenue increased by nearly 22% year-over-year to $35.75 billion. Moreover, the company revealed that its cloud business is doing phenomenally well with a 69% year-over-year increase in quarterly revenue to $2.38 billion and operating margins of 28.5%. Billionaire Ken Fisher’s Fisher Asset Management sold a paltry 916 shares of the company during the fourth quarter, to bring its total holding in Amazon.com down to slightly below 2.5 million shares.

Disclosure: None