Was Boardman Bay Capital Management Right To Reduce Exposure To Tableau Software (DATA), Applied Materials (AMAT) & Two Other Stocks?

Will Graves‘ Boardman Bay Capital Management is an equity long/short fund that focuses on investing in highly liquid sectors, mainly technology, media and telecom stocks. It is no wonder then, that tech stocks accounted for 77% of the fund’s equity portfolio at the end of the third quarter. The portfolio’s market value was estimated at $59.6 million, nearly half of the fund’s $120 million worth of assets under management it reportedly had at the end of March 2016.

At Insider Monkey, we have established our own metric for hedge fund performance: we look at the performance of fund’s stock picks that have a market cap of $1 billion and more. According to our data, 35 of Boardman Bay Capital Management’s positions for the third quarter qualified under our assumptions, generating a return of 15.06%, making it one of the best performers for the quarter. Since the fund is heavily invested in tech stocks, we’ll take a look at some of its top stock picks from this sector and how has Mr. Greaves has positioned his fund heading into the fourth quarter.

First we’re going to take a peek at Himax Technologies, Inc. (ADR) (NASDAQ:HIMX). Will Graves chose to liquidate his fund’s position in Himax Technologies, Inc. (ADR) (NASDAQ:HIMX) during the third quarter, despite the stock ending the quarter up by 5.5%. At the end of the previous quarter, Boardman Bay Capital held 453,472 shares. At the end of the second quarter, a total of 24 of the hedge funds tracked by Insider Monkey were long this stock, down by 11% from the first quarter of 2016. More specifically, Prince Street Capital Management was the largest shareholder of Himax Technologies, Inc. (ADR) (NASDAQ:HIMX), with a stake worth $24.8 million reported as of the end of June. Trailing Prince Street Capital Management was Quentec Asset Management, which amassed a stake valued at $22 million. Garelick Capital Partners, Millennium Management, and Shannon River Fund Management also held valuable positions in the company.

Having made a big bullish bet on Palo Alto Networks Inc (NYSE:PANW) during the second quarter, Boardman Bay Capital has decided to cash out, having dumped 72% of its holding during the third quarter amid a 29.9% gain registered by the stock. According to its latest 13F filing, at the end of September the fund held just 6,121 shares worth $975,000. At the end of the second quarter, a total of 37 of the hedge funds tracked by Insider Monkey were bullish on this stock, a drop of 12% from the previous quarter. Among these funds, Renaissance Technologies held the most valuable stake in Palo Alto Networks Inc (NYSE:PANW), which was worth $139 million at the end of the second quarter. On the second spot was Alyeska Investment Group which amassed $126.4 million worth of shares. Moreover, SRS Investment Management, Criterion Capital, and Tremblant Capital were also bullish on Palo Alto Networks.

Tableau Software Inc (NYSE:DATA) was also among Boardman Bay Capital’s top technology picks, with the management having slightly trimmed its stake during the third quarter. According to its latest 13F filing, the fund reduced its holding by 2% on the quarter to 43,554 shares worth approximately $2.41 million at the end of September. The stock gained 13% during the third quarter. At the end of June, a total of 34 of the hedge funds tracked by Insider Monkey were bullish on this stock, unchanged over the quarter. More specifically, Matrix Capital Management was the largest shareholder of Tableau Software Inc (NYSE:DATA), with a stake worth $267.8 million reported as of the end of June. Trailing Matrix Capital Management was Cadian Capital, which amassed a stake valued at $126.9 million. Brookside Capital, Altimeter Capital Management, and SRS Investment Management also held valuable positions in the company.

Will Graves has taken serious steps to reduce his fund’s exposure to Applied Materials, Inc. (NASDAQ:AMAT), having only bought into this stock during the previous quarter. In its latest regulatory filing, Boardman Bay Capital disclosed a 52% reduction in its holding of Applied Materials stock to 38,791 shares reportedly worth approximately $1.17 million. The move came as the stock advanced by 26.2% during the third quarter. A total of 47 funds from our database were bullish on this stock at the end of June, a change of 21% from the first quarter of 2016. Among these funds, D E Shaw held the most valuable stake in Applied Materials, Inc. (NASDAQ:AMAT), which was worth $314 million at the end of the second quarter. On the second spot was Millennium Management which amassed $205.4 million worth of shares. Moreover, Two Sigma Advisors, Renaissance Technologies, and Levin Capital Strategies were also bullish on Applied Materials, Inc. (NASDAQ:AMAT).

Disclosure: none