Billionaire David Einhorn’s Investor Letter: 2 New Picks and Other Holdings

#2 PVH Corp (NYSE:PVH) – the unfairly beaten-down apparel company

Moving onto the newly initiated positions, Einhorn added the $7.88 billion apparel company to his fund’s portfolio at an average price of $75.65. Based on PVH Corp (NYSE:PVH)’s current stock price, the investment has already reaped more than 27% in returns. Greenlight figured out that the concerns surrounding a weak 2015 holiday season and foreign exchange headwinds were overplayed and went long at a time when these apprehensions were eroding the stock price. The significant sales growth of Calvin Klein business in Europe, continued cost-cutting efforts at Heritage, and integration moves that will ultimately result in direct sales as opposed to the current franchise operations are the salient reasons why PVH Corp (NYSE:PVH) has inspired Greenlight’s confidence. Even after a 45% reduction in its PVH holding, Larry Robbins‘ Glenview Capital was the largest shareholder of the company, within our database, owning about 2.44 million shares at December-end.

#1 Yelp Inc (NYSE:YELP)- the promise of high returns

Lastly, Greenlight added the $1.64 billion owner of search and review website for local businesses at an average price of $21.16. So far this year, Yelp Inc (NYSE:YELP)’s stock has plunged by more than 25% owing to slower growth in the face of increasing competition and also anxiety about an upcoming negative documentary. According to Greenlight’s investor letter YELP’s management is reducing costs by moving its sales force to lower cost cities, is adding more transaction-based revenue, and providing more reporting tools to its customers. The hedge fund expects the stock to hit a $55 mark by 2019, doubling its revenues. However, if the firm decided to operate only its top 20 markets instead, even then the upside would stand at 30%. Ken Fisher‘s Fisher Asset Management reduced its Yelp Inc (NYSE:YELP) stake by 1% during the first quarter to 380,900 shares valued at $8 million.

Disclosure: None