When Billionaire Activist Barry Rosenstein Buys These Stocks, You Sell Them

Barry Rosenstein more than doubled his position in technology giant Hewlett Packard Enterprise Co (NYSE:HPE) during the third quarter, taking his total stake to 6.8 million shares worth $155 million. The company has given an excellent return of 68% to its investors over the last year and currently trades at the top of its 52-week price range. That may have prompted D. E. Shaw, Arrowstreet Capital, and Israel Englander‘s Millennium Management to sell the stock during the September quarter. Hewlett Packard Enterprise Co (NYSE:HPE) reported a 7% yearly drop in revenue for its fiscal fourth quarter. The company that makes most of its money from its legacy server business and faces threats from new cloud computing companies. $3.78 billion worth of HPE shares were held by 71 funds in our system at the end of September, versus shares valued at $2.72 billion held by 63 funds at the end of the June quarter.

Priceline Group Inc (NASDAQ:PCLN) was a new addition to JANA Partners’ portfolio during the third quarter, with the fund buying 105,409 shares of the stock worth $155 million. The performance of Priceline Group Inc (NASDAQ:PCLN) has been solid, with the stock gaining 16% over the last year, but the stock seems pricey with a trailing P/E of 38x. The company recently appointed Glenn Fogel as CEO beginning in 2017. While Priceline Group Inc (NASDAQ:PCLN) has performed extremely well over the last decade, it faces increasing competition and disruption from the likes of AirBnB. Smart money is bullish nonetheless, with the number of smart money managers having Priceline Group Inc (NASDAQ:PCLN) in their portfolios increasing to 98 as of September 30, from 85 quarter-over-quarter.

Alphabet Inc (NASDAQ:GOOG) is the world’s second most-valuable company and forms 2.67% of JANA Partners’ 13F portfolio as of the end of the third quarter. Barry Rosenstein reduced his stake in the company substantially, selling 317,658 class C shares, reducing his fund’s overall position to 196,023 class C shares worth $152 million. The stock has underperformed the overall markets, gaining just 4.9% year-to-date. It is expected that large technology companies may not perform well under the new Trump administration, as he enacts more trade protectionist policies. This may bring Alphabet Inc (NASDAQ:GOOG) under increased regulatory pressure from foreign governments in China and Europe. The number of hedge funds in our database long Alphabet Inc (NASDAQ:GOOG)’s class C shares rose to 134 during the third quarter, from 126 at the end of June. 137 funds were also long the company’s class A shares at the end of September, up from 135 three months earlier.

Disclosure: None