November 14, 2012 / 6:55 PM / 5 years ago

Some hedge funds shower love on Green Mountain, Yahoo in 3rd qtr

NEW YORK, Nov 14 (Reuters) - Patrick McCormack, the manager of hedge fund Tiger Consumer Management, decided to bet against rival David Einhorn in the third quarter.

McCormack’s $2 billion fund jumped into two stocks that Einhorn, founder of $8 billion Greenlight Capital Management and one of a handful of savvy traders who can move markets with his “short” calls, has said publicly he is shorting, or betting against.

Quarterly regulatory filings for Tiger Consumer show McCormack acquired a 280,000 share stake in Chipotle Mexican Grill Inc and increased his fund’s stake in Green Mountain Coffee Roasters Inc by 500,000 shares to 1.5 million shares.

Einhorn, one of the $2 trillion hedge fund industry’s most closely-watched managers, has given presentations questioning the prospects for both Chipotle and Green Mountain Coffee.

Tiger Consumer disclosed its recent moves in a so-called 13-F filing, which all large money managers are required to file with the U.S. Securities and Exchange Commission after the close of each quarter.

The filings give a glimpse into the thinking and strategies of managers and, in this case, indicates that, while Einhorn is bearish on those two stocks, McCormack is more bullish.

Other filings reveal that Chase Coleman and his $6 billion Tiger Global Management made a big bet o n Y ahoo Inc by opening a 25 million share position in the Internet company, and Philippe Laffont’s $3.5 billion Coatue Management acquired 1.4 million shares in social networking company Facebook Inc.

Overall, the third quarter was a good one for U.S. stocks and hedge funds with the benchmark S&P 500 rising 5.76 percent and the average hedge fund gaining 3 percent. By contrast, stocks have retreated mightily in the fourth quarter with the S&P 500 falling 5 percent as of Nov. 13.

Since 13-F filings are released roughly 45 days after the end of quarter, it is important to note that what might have appeared as profitable bets by a manager in the third quarter might not be so smart right now in light of the recent market reaction.

Much of the selling in stocks right now is a response to concern about whether a newly re-elected President Obama and a Republican-controlled House of Representatives will be able to reach an agreement to deal with expiring income tax cuts and large pre-planned spending cuts.

For more on how big money managers traded in the third quarter, here is a breakdown by sectors and high-profile stocks:


Yale University’s $19.3 billion endowment acquired 133,000 shares of children’s clothing company Carter’s Inc. Tiger Consumer added about 500,000 shares to its stake in Monster Beverage Corp, whose stock dropped 24 percent in the third quarter.


Farallon Capital Management nearly doubled it position in credit card company Visa Inc to 1.17 million shares. Alyeska Capital raised it stake in Citigroup Inc to 943,000 shares from 181,400 shares.


Brigade Capital Management roughly doubled its stake in Beazer Homes USA Inc to 2.5 million shares, but eliminated its 500,000 share position in DR Horton.


Tiger Global raised its stake in Facebook to 11.7 million shares from 2 million shares at the end of the second quarter.

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