BOSTON Hedge fund manager William Ackman has long been a cheerleader for ailing retailer J.C. Penney, and during the third quarter other prominent investors joined in.
Lee Ainslie who runs Maverick Capital nearly doubled his stake to hold 4.7 million shares in the retailer at the end of the quarter, according to regulatory filings released on Wednesday. Ricky Sandler's Eminence Capital took a new position in Penney, owning 1.17 million shares at the end of the quarter.
Fund managers with more than $100 million in assets are required to disclose holdings in U.S. stocks within 45 days after the end of each quarter. While the data is backward looking, it can hint at trends for certain stocks.
News that two well-performing fund managers put more money to work in Penney is bound to be good news both for the company and Ackman's Pershing Square Capital Management, Penney's biggest investor with roughly 38 million shares.
On Friday Penney reported that sales tumbled 26.1 percent during the third quarter, news that sent its shares down some 26 percent in the last five days.
Ackman is staying the course, telling anyone who will listen that when Ron Johnson, the former Apple Inc executive he handpicked to revive Penney, completes his job "you will shop at J.C. Penney."
As Penney's shares fell to a more than three-year low on Wednesday, closing at $16.89, some other hedge fund managers said privately that the price may finally be right to get in. Any purchases made during the current quarter would not be made public until early 2013.
(Reporting By Svea Herbst-Bayliss)