Hedge funds were busy trading Club holdings last quarter, regulatory filings show

Published Tue, Nov 15 20225:05 PM EST

Kevin Stankiewicz @in/kevin-stankiewicz-b5593466 @kevin_stank

High-profile hedge fund managers made trades involving a number of Club stocks in the third quarter, with potentially significant implications for holdings across the tech, entertainment, retail and health-care sectors. Among the most relevant came from Daniel Loeb's Third Point, which amassed a 1.75 million share position in TJX Companies (TJX) over the three months ended Sept. 30. In the quarter, Loeb's activist hedge fund also increased its position in Danaher (DHR) by roughly 17%, bringing it up to 2.7 million shares, according to a 13F filing with the Securities and Exchange Commission. What's more, Third Point added to its bet on Disney (DIS), owning 1.4 million shares as of Sept. 30, up 40% compared with its position on June 30. In August, Loeb had called on Disney to spin off ESPN into a separate entity, before reversing course a few weeks later and signaling he now believes it's better to keep the sports network inside the entertainment conglomerate. Then, on Sept. 30, Disney and Third Point reached an agreement on several provisions, including the appointment of former Meta Platforms (META) executive Carolyn Everson to Disney's board . Another Club-related move came from Nelson Peltz's Trian Partners, which increased its position in Procter & Gamble (PG) by 2.4% during the reporting period. That valued the position at roughly $700,000 as of Sept. 30, which is quite small for a multi-billion dollar investment firm like Trian. Nevertheless, it's worth highlighting given Peltz's storied history with the company. The activist investor left P & G's board last year, a role he assumed in 2018 following a proxy fight with the consumer products giant. In Peltz's previous two 13F reports, Trian held 5,457 shares of P & G. That increased to 5,589 in the latest disclosure. In its quarterly filing, Paul Singer's Elliott Management revealed a small stake in troubled Bausch Health (BHC), buying up 14,625 shares worth $101,000, as of Sept. 30. Conversely, activist investor ValueAct appears to have sold its entire position during the three months covered in the reporting period. In August, the firm had reported owning 14.34 million shares as of June 30. Big picture Institutional investors who manage at least $100 million in assets must submit 13F disclosures to the U.S. Securities and Exchange Commission on a quarterly basis, providing the public a high-level glimpse into their holdings every three months. The 13F filings don't just show a fund's common stock positions, but also bonds and open options contracts. Taken all together, the disclosures can shed light on how well-respected fund managers view broad sectors and specific companies. . In the case of Third Point, it's interesting to note the fund was buying TJX around the same time we were buying shares of the off-price retailer . But, crucially, positions listed in 13F filings are just snapshots in time. They are current as of the reporting date, which for this latest round of disclosures was Sept. 30. We're only finding out about it in mid-November, so it's entirely possible that some holdings have changed. Another shortcoming of 13Fs is that short positions aren't listed. Bottom line Paying attention to 13Fs fits within our mantra of "buy and homework" investing. It's important to know who else is invested in your stocks, especially when it's a more activist-oriented hedge fund or influential entities like Warren Buffett's Berkshire Hathaway. Just look at the more than 11% gain in Taiwan Semiconductor Manufacturing Company (TSM) shares Tuesday after Berkshire revealed a multi-billion-dollar stake in the company in its 13F filing . At the same time, investors should keep in mind the limitations of these disclosures, so not to make an ill-advised investment decision. (See here for a full list of the stocks in Jim Cramer's Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

Daniel Loeb, chief executive officer of Third Point LLC, speaks at the Skybridge Alternatives conference in Las Vegas, May 18, 2017.

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