Billionaire Stephen Mandel of Lone Pine Capital outperformed the market during the first quarter, with 43 stocks with a market cap of over $1.0 billion in which the investor reported long positions in its last 13F filing, posting an average return of 6%. Almost half of Mandel’s portfolio lies in the technology sector and his methodology still surpassed the tech-heavy NASDAQ by some 2.5 percentage points. Let’s look at some of the main causes of this outperformance by taking a closer look at some stocks in which Mandel owns large stakes, but which also had some significant returns during the first three months of 2015.
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The stock of Priceline Group Inc (NASDAQ:PCLN) is the best performing among all three companies in which Mandel owns largest long positions as of the end of 2014. Mandel nearly doubled his position in the company to 1.4 million shares valued at $1.5 billion held at the end of 2014. Priceline Group Inc (NASDAQ:PCLN) returned only 2.1% during the first quarter, which is still pretty short from the return of some of its peers. For example, Expedia Inc (NASDAQ:EXPE) jumped by 10.50% during the same period. Stephen Mandel likes Priceline Group Inc (NASDAQ:PCLN) because of its 20% plus annual earnings growth rate. Priceline has been a long-term holding for Lone Pine Capital and the investor reaped some nice profits, taking into account that five years ago, the stock traded at around $200 per share. Billionaires David Tepper and John Griffin are among other billionaires with large positions in Priceline.
Mandel hit a homerun with his nearly $1.2 billion stake in Canada-based Valeant Pharmaceuticals Intl Inc (NYSE:VRX), which contains 8.25 million shares. The investment in Valeant Pharmaceuticals Intl Inc (NYSE:VRX) paid off pretty well during the first three months, as Valeant’s stock surged by 39% amid its acquisition of Salix Pharmaceuticals. Valeant Pharmaceuticals Intl Inc (NYSE:VRX) is also one of the favorite healthcare stocks among hedge funds with Pershing Square, run by Bill Ackman, recently disclosing a 5.7% stake. Other significant shareholders include Jeffrey Ubben and Andreas Halvorsen.