Ainslie Lives Up to Reputation for Favoring Technology Stocks

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Nov 21, 2014
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Value investor Lee Ainslie (Trades, Portfolio), the founder and CEO of Dallas-based hedge fund Maverick Capital Management LP, is known for investing in technology stocks. In the third quarter, he bought or sold stock in more than 50 companies, and many were in the technology sector – or, at least, mass media.

Since its inception more than 20 years ago, Maverick Capital Management has had an average annual return of 11.2%.

Ten companies are new to Ainslie’s portfolio – CBS Corp (CBS, Financial), Alibaba Group Holding Ltd (BABA, Financial), Twenty-First Century Fox Inc (FOXA, Financial), Cognizant Technology Solutions Corp (CTSH, Financial), Burger King Worldwide Inc (BKW, Financial), PTC Inc (PTC, Financial), AMC Networks Inc (AMCX, Financial), Northstar Realty Finance Corp (NRF, Financial), Vulcan Materials Co (VMC, Financial) and Novartis AG (NVS, Financial).

Ainslie bought 4,827,970 shares of CBS Corp, a New York-based mass media corporation, for an average price of $58.98. The transaction had a 3.8% impact on his portfolio.

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He acquired 2,200,000 shares in Alibaba, a Chinese e-commerce company, for an average price of $89.95 a share. The purchase had a 2.9% impact on his portfolio.

Ainslie purchased 5,280,500 shares of Twenty-First Century Fox, another New York-based mass media corporation, for an average price of $34.58. That transaction had a 2.6% impact on his portfolio.

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He bought 3,375,000 shares of Cognizant Technology Solutions, a New Jersey-based provider of custom information technology, consulting and business process outsourcing services, for an average price of $47.01. The purchase had a 2.2% impact on his portfolio.

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Ainslie expanded his holding in 14 other companies in the third quarter – Qihoo 360 Technology Co Ltd (QIHU, Financial), AerCap Holdings NV (AER), Fleetcor Technologies, Inc (FLT), AbbVie Inc (ABBV), Martin Marietta Materials Inc (MLM), Radian Group Inc (RDN), McKesson Corp (MCK), Allison Transmission Holdings Inc (ALSN), Adobe Systems Inc (ADBE), Anheuser-Busch Inbev SA (BUD), Liberty Global PLC (LBTYA), Waste Connections Inc (WCN), Santander Consumer USA Holdings Inc (SC) and Castlight Health Inc (CSLT).

He added 2,606,934 shares of Qihoo 360 Technology, a software company based in Beijing, for an average price of $89.1. The acquisition had a 2.54% impact on his portfolio.

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He bought an additional 5,190,618 shares of AerCap Holdings, a Dutch aircraft leasing company, for an average price of $42.41. The transaction had a 1.62% impact on his portfolio.

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Divestitures and reductions

He sold all of his holdings in 12 companies – Ralph Lauren Corp (RL), Humana Inc (HUM), Walgreen Co (WAG), Ctrip.com International Ltd (CTRP), Acadia Healthcare Co Inc (ACHC), Fidelity National Information Services Inc (FIS), New York REIT Inc (NYRT), Home Depot Inc (HD), Avago Technologies Ltd (AVGO), Qualcomm Inc (QCOM), SouFun Holdings Ltd (SFUN) and Ambev SA (ABEV).

Ainslie sold his remaining 724,885 shares of Ralph Lauren, a New York-based apparel, accessories and home furnishings company, for an average price of $164.89 per share. The sale had a -1.7% impact on his portfolio.

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He also sold his holdings – 771,168 shares – in Humana, a health care company based in Kentucky, for an average price of $127.05.

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He divested himself of 1,318,963 shares of Walgreen, a drug retailer based in Chicago, for an average price of $65.54 per share.

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Ainslie’s Humana and Walgreen transactions each had a 1.4% impact on his portfolio.

Ainslie also sold portions of his holdings in 16 companies – Crown Castle International Corp (CCI), Baidu Inc (BIDU), Palo Alto Networks Inc (PANW), HCA Holdings Inc (HCA), Fortinet Inc (FTNT), TransDigm Group Inc (TDG), Intercontinental Exchange Inc (ICE), Community Health Systems Inc (CYH), SolarWinds Inc (SWI), MGIC Investment Corp (MTG), Nokia Oyj (NOK), Dollar General Corp (DG), Qlik Technologies Inc (QLIK), Ashland Inc (ASH), Valeant Pharmaceuticals International Inc (VRX) and Calpine Corp (CPN).