Lumber Liquidators Holdings Inc (LL) Is Added to Stockbridge Partners’ Equity Portfolio

As a recent filing with the Securities and Exchange Commission showed, Berkshire Partners’ subsidiary, Stockbridge Partners, led by Robert J. Small, has initiated a stake in Lumber Liquidators Holdings Inc (NYSE:LL). The fund revealed ownership of around 1.92 million shares of the company, the passive stake being equal to 7.1% of the company’s common stock.

Despite the stock dropping by around 47% since the beginning of the year, Lumber Liquidators Holdings Inc (NYSE:LL) is still the largest company in the home improvement stores industry, having a market cap of around $1.4 billion. The company has been reporting revenue single digit growth over the last several quarters. For the second quarter, the revenue advanced to some $263 million, from $257 million a year ago. However, the net income of the company declined to $0.60 per share from $0.71 for the second quarter of last year. Overall for the current year, the company anticipates revenue between $1.05 and $1.10 billion, which represents an increase over the last year reported result. Moreover, the EPS is forecasted to be in the range between $2.65 and $3.00, versus the reported EPS of $2.77 for 2013.

With the company continuing to invest in opening new stores and developing infrastructure, investors seem to be bullish on the stock, despite its downfall. Among the funds that we track at Insider Monkey, the majority have raised their exposure to Lumber Liquidators Holdings Inc (NYSE:LL) during the second quarter, according to the latest round of 13F filings. Stephen Mandel‘s Lone Pine Capital owns around 2.62 million shares of the company as of the end of June. John Lykouretzos‘ Hoplite Capital Management initiated a stake in the company and reported ownership of around 618,500 shares in its latest 13F filing.

Stockbridge holds a very concentrated equity portfolio, which is worth some $1.73 billion and has 15 positions. The fund surged its exposure to the top three largest holdings, which have been posting solid returns over the last years. The largest stake is represented by TransDigm Group Incorporated (NYSE:TDG), the stake of which jumped by over 25% over the last year, with Stockbridge holding 1.34 million shares after a 28% increase during the second quarter. Markwest Energy Partners LP (NYSE:MWE)  and LPL Financial Holdings Inc (NASDAQ:LPLA) have also gained ground, and Stockbridge owns 2.37 million and 3.12 million shares respectively.

Disclosure: none