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Pelham Capital’s Returns, AUM, and Holdings

Back in 2007, Ross J. Turner, a 29-year-old investment manager, decided it was time to stop working for others, starting his own small-cap fund Pelham Capital. Prior to founding Pelham, Mr. Turner, who functions as its portfolio manager, was a ‘rising star’ of the big London hedge fund, Lansdowne Partners, where he was in charge of investment management. Prior to that he worked at JP Morgan Cazenove Limited as an Investment Adviser. It seems that Ross Turner learned plenty tricks of the trade while working at Lansdowne Partners, as he has managed to outperform his former bosses a few different times with his new fund. According to the Sunday Times, Ross Turner is among the 20 richest hedge fund managers in Britain with an estimated £300 million fortune, up by £77 million from the previous year.

Pelham Capital uses a long/short investment strategy, focusing on acquiring long-term positions in companies that have stable cash flows and promising growth, while at the same time searching for targets to sell short. This strategy has resulted in very strong returns. According to Barron’s, the fund returned 39% in 2017 and averaged 27% returns between 2015 and 2017, ranking in fourth position among the top 100 hedge funds in 2018. According to the most recent data, Pelham Capital’s 13F portfolio is valued at $510 million, while the value of its assets under management is unknown.

Vintage Tone/Shutterstock.com

Vintage Tone/Shutterstock.com

Insider Monkey’s flagship strategy identifies the best performing 100 hedge funds in our system at the end of each quarter and invests in their consensus stock picks. This way it is always invested in the best ideas of the best performing hedge funds and is able to generate much higher returns than the market. Since its inception in May 2014, our flagship strategy generated a cumulative return of 121% vs. a cumulative gain of 66.6% for the S&P 500 ETF (SPY) (see the details here).

Pelham’s 13F portfolio currently owns only five stocks according to its most recent 13F filing with the Securities and Exchange Commission, for the second quarter of 2018. The largest stake was in online and mobile food-ordering company, Grubhub Inc. (GRUB), with the fund holding 2.6 million shares valued at $271 million. That accounted for more than half of the value of Pelham’s 13F portfolio at 53.11%. Pelham Capital actually lowered its stake in the company by 5.9% in the second quarter. Interestingly, investors from Insider Monkey’s database are getting more bullish on this stock, with 35 hedge funds with long positions at the end of the second quarter, up by 12 from a quarter earlier. Collectively, those 35 funds own 14.20% of the company’s outstanding shares, with Paul Reeder and Edward Shapiro’s PAR Capital Management holding the largest stake, valued at $297 million.

Pelham Capital added three new stocks to its portfolio in the second quarter, acquiring 6.9 million shares of Altice Usa Inc (ATUS) valued at $118.5 million, buying 1.45 million shares of United States Steel Corp (X) worth around $50.39 million, and obtaining 120,715 shares of Ferrari N V (RACE) worth $16.3 million. Out of those three stock picks, one has attracted the most attention in the second quarter among the hedge funds that we track. That was American cable television provider/multiple system operator, Altice Usa Inc (ATUS), which gained a net total of 13 more hedge fund shareholders in Q2. 38 investors out of those that we follow had long positions in this stock at the end of June, collectively owning 8.40% of the company’s outstanding shares at that time.

The fund didn’t make any changes to its position in Golar L N G Ltd (GLNG) during the second quarter, holding on to its 1.83 million shares, which worth $53.9 million on June 30. Out of the 32 hedge funds from our database which reported owning long positions in Golar as of June 30, Ken Griffin’s Citadel Investment Group held the most valuable one, worth around $75.7 million.

Disclosure: None

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