Tiger Eye Capital 2014 Q2 Investor Letter

Tiger Eye Capital’s 2014 Q2 investor letter is out. Ben Gambill founded this equity long/short hedge fund in 2009 with seed money from billionaire Julian Robertson. This is one of the rare hedge funds that outperformed the S&P 500 index both in 2013 and 2012. Tiger Eye Master fund returned 37.6% in 2013 and 18.2% in 2012. This year’s returns has been on the slow side. According to Tiger Eye Capital’s 2014 Q2 investor letter the fund returned 1.6% during the second quarter and 0.9% during the first half of 2014. Here is what the fund said about its second quarter performance:

“We were profitable in the energy, industrials, materials, and media sectors while the real estate, consumer, and healthcare sectors were detractors. Several core positions that we have mentioned in past letters continued to perform well operationally through 2Q2014. Secure Energy Services (SES CN) was up 23.5% in the 2nd quarter due to its accelerating growth in the U.S. along with continued strong execution in Western Canada, and Canadian Pacific Railway (CP) was up 20.4% as the company continues to make significant operational improvements.

“As mentioned in our 1Q2014 letter, the amount of corporate change that we are seeing remains robust. We spend a substantial amount of time assessing the impact of major corporate events and whether or not the market has placed an appropriate value on such changes. In the 2nd quarter, we initiated large positions in two recent spin-outs. In addition, eight of our current positions, both on the long and short sides, are associated with an upcoming business structure change that our research indicates will have a meaningful stock impact.”

Ben Gambill went on to discuss his investment thesis in a $3 billion internet stock that, he believes, has an upside potential of 70%. This stock is already up 7% over the past week. Please subscribe to our monthly newsletter if you want to find out one of Ben Gambill’s best investment ideas.