Coatue Management was founded by Philippe Laffont in 1999, after the hedge fund manager worked with Julian Robertson at Tiger Management. As is the case with many “Tiger Cubs,” Laffont’s own fund focuses on his area of expertise: the technology sector. Coatue employs traditional long-short equity tactics. Before working with Julian Robertson, Laffont graduated from M.I.T. in the late eighties.
Due to the fact that it’s important to track hedge funds’ favorite picks–discover their market-beating potential here–we’re going to check in on Laffont’s latest 13F filing with the SEC. Data is as of the second quarter, and can be compared to first-quarter data here. There are some surprises in this top five; let’s take a look.
In first position is Equinix Inc (NASDAQ:EQIX). Laffont and his team left the size of their stake, which totaled $950 million at the end of the first quarter, relatively unchanged, but Mr. Market has thought otherwise. Shares of the IT consulting company have lost 24% in value over the last three months, and Coatue’s position is now worth just over $800 million. Still, with that size, we’ll continue to watch the Tiger Cub in this market-hated stock.
CBS Corporation (NYSE:CBS) and Time Warner Inc (NYSE:TWX) sit at No.’s 2 and 3 in Laffont’s equity portfolio, worth stakes valued at $705 million and $686 million, respectively. The hedge fund manager cut his position in Time Warner by close to 1 million shares in Q2, though up over 30% year-to-date, it’s likely this is just simple profit-taking.
CBS, meanwhile, which is in the process of converting its billboard advertising arm into a REIT structure, saw the size of its stake remain essentially unchanged. Laffont’s bullishness in the media giant is understandable–shares are up nearly 40% in 2013 alone–as the proposed REIT conversion should create value for both companies. It’s possible that Laffont decides to hold onto the REIT post-split, so we’ll be watching CBS Corporation (NYSE:CBS) very closely; Time Warner Inc (NYSE:TWX) as well.
The entire financial world knows that Carl Icahn has taken a supposedly large position in Apple of late, and it’s worth mentioning that the legendary Jim Simons, of Renaissance Technologies, has gone long as well. Some think that more share buybacks can push shares back up above $600 or even $700 a pop, but another dividend hike may be necessary.
What’s more, it’s quite possible that Laffont is hoping Apple Inc. (NASDAQ:AAPL) gets a bit bolder with its $140-plus billion in cash. Such a bold move could come via acquisition, a new product development, or a version of an existing product geared toward emerging markets. Either way, we’ll be watching Apple very closely until it unveils which devices will carry iOS7 natively this fall.
Laffont upped his stake to 1,415,378 shares, worth $631 million, versus 1,205,403 ($533M) at the end of Q1. It was an intriguing time to make such a move, as Apple is down 6.2% in 2013 on the whole.
Until next time, continue reading Insider Monkey for more updates on this situation.