Ken Griffin Keeps Raising Stakes in Depreciating Stocks

Ken Griffin‘s Citadel Investment Group has made two other bullish bets involving two companies: C&J Energy Services Inc (NYSE:CJES) and Francesca’s Holdings Corp (NASDAQ:FRAN). The fund disclosed holding 2.84 million shares of C&J Energy Services, up from 1.94 million shares held earlier, while in Francesca’s Holdings, the investor boosted its position to 2.23 million shares, from 477,700 reported in its latest 13F filing. Following the increase, Citadel holds 5.1% of C&J Energy Services and 5.3% of Francesca’s Holdings, both stakes being passive by nature.


In both companies, Citadel has been a long-term shareholders. C&J Energy Services Inc (NYSE:CJES)  is a $690 million provider of hydraulic fracturing, coiled tubing and other services related to the drilling of oil wells. Its stock declined by 49% since the beginning of the year, a significant drop starting in the second half of the year as the oil prices started to fall dragging the stocks of companies somehow related to the commodity. However, theres is another reason for C&J Energy Services decline in the last couple of months. At the end of June, C&J Energy Services Inc (NYSE:CJES)  agreed to combine its completion and production services businesses with Nabors Industries Ltd. (NYSE:NBR). However, a couple of weeks ago, the Delaware Chancery Court issued a rulling that required C&J Energy to solicit competing proposals from other buyers before it can close the $2.8 billion deal with Nabors Industries.

In this way, investors that have been betting on C&J Energy Services Inc (NYSE:CJES)  in connection with the deal have been left disappointed. One of these investors is Steven Cohen‘s Point72 Asset Management which raised its stake in September to 3.61 million shares from around 3.0 million shares held earlier, but a month later, the investor cut the holding down to 2.55 million shares.

The stock of Francesca’s Holdings Corp (NASDAQ:FRAN) also slumped since the beginning of the year, losing around 15% year-to-date. The specialty retailer has recently posted its financial results for the third quarter, which came disappointing. While the sales of Francesca’s Holdings went up by 9.5% on the year to $87.1 million, it was mainly due to the opening of around 90 new stores. On the other hand the comparative store sales slumped by 6%, while net income also fell to $0.17 per share, from $0.20 per share a year ago.

Despite a decline in financial results, investors seem to like Francesca’s Holdings Corp (NASDAQ:FRAN). As our data show, at the end of the third quarter, 18 funds held shares of the company, out of more than 700 investors that we track; this number went up from 16 funds in the previous quarter. Overall, these funds owned around $117.40 million worth of Francesca’s Holdings’ stock, up by $10.04 million over the quarter. The largest shareholder among the funds that we track is Mariko Gordon’s Daruma Asset Management, which owns 3.89 million shares as of the end of September.

Disclosure: none