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Which Stocks Hedge Funds Bought And Sold In Q1

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By: Spencer Israel

The coronavirus-induced market volatility began in earnest on Feb. 24, which gave hedge fund managers five weeks to adjust their portfolios before the end of the quarter. 

With regulatory 13F filings due last Friday, we finally know what they did. 

A Lot Of Selling
According to data from WhaleWisdom, assets under management by 13F filers (investors with at least $100 million in AUM) fell by 23% during the first quarter, to $24.1 trillion from $34.1 trillion at the end of 2019. That was the biggest quarterly decline in AUM since Q4 2008. 

Last week’s filings also revealed 274 more net sellers of stocks than net buyers during the first quarter. That’s a stunning reversal from the prior quarter, during which there were 567 more net buyers than sellers. It also marks the greatest amount of net sellers among 13F filers since Q3 2016. 

Source: Whalewisdom.com

Stocks That Were Most Bought
Perhaps unsurprisingly, Amazon ($AMZN) was the most bought stock among all 13F filers last quarter. Overall, there more than twice as many buys/increased stakes (1,961) as sells/reduced stakes (934). 

Linde ($LIN) was the most popular new stake last quarter, with 912 hedge funds initiating a position in the company. 

Vertiv Holdings ($VRT) saw the greatest increase in hedge fund activity last quarter. The electrical equipment company was mentioned in 100 13F filings—98 of which were new positions—according to WhaleWisdom, after garnering just one mention in Q4 2019. 

The most loved stock was arguably Change Healthcare ($CHNG). The healthcare technology company was mentioned in 220 filings, with 94% of those mentions corresponding to a new buy or increased position. 

Stocks That Were Most Sold
Apple ($AAPL) was the stock with the greatest number of reduced positions among hedge funds last quarter, with 1,756 hedge funds lowering their stake. But Boeing ($BA) was arguably the most hated stock.

According to WhaleWisdom, 494 hedge funds exited out of their Boeing positions entirely last quarter, more than any other company (though 128 funds did initiate new positions). Just behind Boeing were Raytheon Technologies ($RTX) (449 hedge funds closed positions) and ConocoPhillips ($COP) (394). 

Diverging Views On Big Names
Big tech was largely bought by hedge funds during the quarter, but there were a number of high-profile investors on both sides of the trade. 

Facebook ($FB), for example, was bought last quarter by Leon Cooperman’s Omega Advisors, Seth Klarman’s Baupost Group, and Cliff Asness’ AQR Capital Management. 

On the other side, David Tepper’s Appaloosa Management, Jim Simons’ Renaissance Technologies, and Ken Griffin’s Citadel were among the funds that dramatically cut their positions in the company. 

Klarman also initiated a new position in Alphabet ($GOOGL), while Tepper, Cooperman, and George Soros all reduced their holdings. 

The same can be said for the banks. 

Warren Buffett’s Berkshire Hathaway reduced its stake in Goldman Sachs ($GS), while David Einhorn’s Greenlight Capital increased its stake. Buffett and Soros also reduced their stakes in JP Morgan ($JPM), while Cooperman added to his position. 

Buffett notably did not reduce his positions in Bank of America ($BAC) or Wells Fargo ($WFC), while Soros sold the former and Cooperman sold the latter. 

The author owns Alphabet, Amazon, Bank of America, Boeing, ConocoPhillips, Goldman Sachs, Facebook, JP Morgan, Linde, Raytheon Technologies, and Wells Fargo in his 401(k).

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The post Which Stocks Hedge Funds Bought And Sold In Q1 appeared first on Low Cost Stock & Options Trading | Advanced Online Stock Trading | Lightspeed |.



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The IPOX® Week, July 13, 2020

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  • IPOX Indexes continue broad-based rally. IPOX 100 U.S. (ETF: FPX) closes week at highest level on record.
  • IPOX 100 U.S. (ETF: FPX) adds +3.64% to +10.20% YTD. IPOX International (ETF: FPXI) rises +3.40% to +35.56% YTD. IPOX 100 Europe (ETF: FPXE) gains +1.70% to +12.81% YTD.
  • “Hot” IPO market: Big initial openings characterize the week’s IPOs in the U.S. and Hong Kong.

IPOX Indexes continue broad-based rally. IPOX 100 U.S. (ETF: FPX) closes week at highest level on record. The IPOX Indexes surged last week as: 1) Momentum buying continued to press technology and select consumer/health care stocks into uncharted territory amid the continued historical divergence in equity indexes spreads ahead of U.S equity option expiration week (NDX: +4.78%, RTY: -0.64%), 2) Falling U.S. yields amid Covid-19 anxiety provided further support to equity risk (VIX: -2.03%). Momentum in the IPOX Indexes, however, slowed into the week-end as investors took profits in some recently well-performing portfolio holdings. In the U.S., e.g., the FANG-free and broad-based $1.4 billion IPOX-100 U.S.-linked “FPX” ETF, the world’s largest IPO-focused ETF, added +3.64% to +10.20% YTD, extending its YTD lead vs. the S&P 500 (SPX) by +188 bps. to a large +1162 bps. Here, 62/100 firms rose, with the average (median) equally-weighted IPOX 100 U.S. portfolio holding adding +2.61% (+1.03%), significantly underperforming the

FPX: World’s largest U.S. IPO-focused ETF sets All-time High

Chart: IPO asset allocation with the “FPX” ETF since fund launch in 2006.

index. Big momentum also drove the diversified IPOX International, underlying for the $153 million “FPXI” ETF, to a fresh weekly all-time high, adding +3.40% to +35.56% YTD, a massive +4673 bps. ahead of the MSCI World (ex. U.S.) (MXWOU Index) YTD. In the IPOX 100 U.S., firms including biotechs Livongo Health (LVGO US: +45.14%) and Principa Biopharma (PRNB US: +14.34%), social networker Snap (SNAP US: +9.95%) and recreational vehicle distributer Camping World (CWH US: +8.98%) stood out, while phone maker H.K.-traded Xiaomi (1810 HK: +18.37%) and property servicing firm Country Garden Services (6098 HK: +14.09%), Brazils IPO M&A multichannel retailer Magazin Luiza (MGLU3 BS: +11.36%), and Riyadh-traded Dr. Sulaiman Al Habib Medical Services Group (SULAIMAN AB: +6.91%) recorded notable gains in the IPOX International. Firms including U.S. real estate website firm Redfin (RFIN US: -11.47%) and Germany’s online food ordering platform operator Delivery Hero (DHER GY) ranked amongst the worst performing IPOX portfolio holdings on the week.

Select IPOX® Indexes Price Returns (%) Last Week 2019 2020 YTD
IPOX® Indexes: Global/International
IPOX® Global (IPGL50) (USD) 4.13 27.93 31.67
IPOX® International (IPXI)* (USD) (ETF: FPXI) 3.40 31.37 35.56
IPOX® Indexes: United States
IPOX® 100 U.S. (IPXO)* (USD) (ETF: FPX) 3.64 29.60 10.20
IPOX® ESG (IPXT) (USD) 3.42
IPOX® Indexes: Europe/Nordic
IPOX® 30 Europe (IXTE) (EUR) 0.76 34.55 22.93
IPOX® Nordic (IPND) 1.45 38.52 30.67
IPOX® 100 Europe (IPOE)* (USD) 1.70 30.97 12.81
IPOX® Indexes: Asia-Pacific/China
IPOX® Asia-Pacific (IPTA) (USD) 1.97 4.41 16.75
IPOX® China (CNI) (USD) 6.64 26.31 44.32
IPOX® Japan (IPJP)** (JPY) 3.00 37.91 0.69

* Basis for ETFs: FPX US, FPX LN, FPXE US, FPXU FP, FPXI US, TCIP110 IT and CME-traded e-mini IPOX® 100 U.S. Futures (IPOM0). Source: Bloomberg L.P. & Refinitiv/Thomson Reuters. For IPOX Alternative Strategies Returns, please contact info@ipox.com

IPOX-linked ETFs (FPX, FPXI, FPXE) Movers (Last Week in %):

LIVONGO HEALTH INC 45.14 ADC THERAPEUTICS SA -14.99
TESLA INC 27.80 KARUNA THERAPEUTICS -12.17
XIAOMI CORP 18.37 REDFIN CORP -11.47
CARDLYTICS INC 17.29 JOHN LAING GROUP PLC -9.31
ALIBABA GROUP HOLDING 16.73 ASCENDIS PHARMA A/S -9.29
EVER SUNSHINE LIFESTYLE 16.02 HEADHUNTER GROUP P -9.16
PRINCIPIA BIOPHARMA INC 14.34 VIELA BIO INC -9.01
COUNTRY GARDEN SERV. 14.09 VARTA AG -8.35
ZSCALER INC 13.86 SAFEHOLD INC -7.37
FARFETCH LTD 12.39 DELIVERY HERO SE -7.32

IPO Deal-flow Review and Outlook: E-cigarette maker Smoore doubles on largest deal of the week in Hong Kong. Busy week for IPOs ahead. At least 13 sizable IPOs commenced trading across the global regions last week, with the average (median) equally-weighted deal adding +59.53% (+39.13%) based on the difference between the final offering price and their respective market’s close. Pre-clinical biopharmaceutical company Nkarta (NKTX US: +166.11%) almost tripled, while Chinese LGBTQ dating app BlueCity (BLCT US: +53.13%) also rose strongly on debut. H.K. had the busiest week YTD with e-cigarette vaping device maker Smoore (6969 HK: +150.00%) and 1896x oversubscribed ophthalmic company Ocumension (1477 HK: +152.39%) recording big initial returns. Lined up for this week in the U.S. are Financial software developer nCino (NCNO US) and Chicago-based health insurance marketplace GoHealth (GOCO US), while H.K. is set for another busy week with H.K.’s largest IPO YTD, China Bohai Bank (9668 HK) lined up. Other IPO news include: 1) Data analytics titan Palantir, U.S. largest mortgage lender Rocket Companies (Quicken Loans) and egg & butter producer Vital Farms filed for IPO 2) Cryptocurrency trading platform Coinbase, Apollo-backed Rackspace prepares for listing 3) SoftBank backed Chinese real estate brokerage Beike Zhaofang, Goldman Sachs-backed payment card issuer Marqeta eyes U.S. IPO 4) Brazilian energy and infrastructure group Cosan considers to spin off its sugar and fuel distribution units Raizen Combutiveis and Raizen Energia in IPO, Brazilian mobile network operator Surf plans U.S. listing 5) French pharmaceutical giant Sanofi proceeds with its $2B+ active ingredient unit IPO 6) Postmates IPO off the table with Uber’s $2.65B takeover in place.

The post The IPOX® Week, July 13, 2020 appeared first on Low Cost Stock & Options Trading | Advanced Online Stock Trading | Lightspeed |.



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The Rise of Grocery E-commerce and Returns

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Grocery e-Commerce as a temporary change…

As a global pandemic and quarantine swept the world, consumers fled to grocery stores to stock up on essentials. Then ensued the shortage of items like toilet paper and hand sanitizer, and purchases of items such as fresh produce spiked by as much as 600%. As quarantine regulations went into effect, shoppers started opting for online grocery orders rather than going into the physical stores, creating a surge in grocery e-commerce. So much so that Instacart—the San Francisco-based grocery delivery service—had a sales increase of 55% in the month of May; a 30% increase from February that has allowed it to secure a $225 million in new funding to scale its operations. 

The future of grocery e-commerce 

So, what does this translate to in the grocery e-commerce landscape? As it turns out, about $38 billion. In 2019, online grocery orders increased by 22% and accounted for about 2.6% of U.S. food and beverage retail sales. But recent figures show that in light of the pandemic and consumer purchase shifts, these same orders are expected to surge to about 40% in 2020, bringing the projected growth in online grocery purchases to 3.5%—or roughly $38 billion. 

Without a doubt, the impacts of COVID-19 have been felt across all sectors of retail, and consumer shopping habits are changing. In fact, whether we look at actual online grocery orders or plans to place online grocery orders, both figures have more than doubled in the last two years. 

Year Purchased groceries online in the last 12 months  Planned to purchase groceries online in the next 12 months
2018 23.1% 25.8%
2019 36.8% 39.5%
2020 52% 62.5%

But what about grocery returns? 

Remember those purchase spikes we talked about earlier? Well, considering the fact that grocery stores remained open and supplied with most items during the quarantine, how much of that over purchasing was necessary, and how much of it will be returned? On the other side of the purchase boom, there is typically a return boom. Over the past several months, items of various types have sold out, such as hygiene products, canned, and bottled goods. So, with a surge in grocery e-commerce fueled by a global pandemic, what will happen with the items that consumers over-purchased and no longer need? 

As quarantine restrictions ease, different retailers have updated their return policies. Costco is not accepting returns of toilet paper, paper towels, sanitizing wipes, water, rice, or disinfecting spray. CVS on the other hand, has stated that “Most new, unopened items purchased from CVS Pharmacy or CVS.com can be returned to any CVS Pharmacy store within 60 days.” Walmart is restricting returns of essential goods, but is also recommending that consumers start a return process online—for products in any category. And grocers in Michigan are now accepting can and bottle returns

What Can Grocers Do?

In a world where a global pandemic has created a pathway for grocery e-commerce to thrive, grocers need a liquidation solution to sell overstock items that can no longer be sold in grocery stores that extends beyond their omnichannel strategies. That’s where B-Stock can help. We provide retailers a private, online marketplace to auction off their returned and overstock merchandise to a large network of vetted business buyers from all over the globe. It’s why nine of the top 10 U.S. retailers are currently using our solution to offload their excess inventory—regardless of product type. 

If you’re ready to tap into an e-commerce solution for your excess grocery products, request a demo.

Request Demo

The post The Rise of Grocery E-commerce and Returns appeared first on B-Stock Solutions.



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Rossari Biotech Ltd IPO; Favourite sector stock may see listing gains

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Rossari Biotech Ltd IPO Details:

Issue Open date: 13th July 2020

Issue Close date: 15th July 2020

Equity shares offered: 10.5 Lakh

Price Band: 423-425

Issue Size: 496 Cr

Minimum lot size: 35

Purpose of the offer

Net Proceeds of the issue are proposed to be utilized in:

  • Repayment/prepayment of certain indebtedness.
  • Funding working capital requirements.
  • General corporate purposes.

About Rossari Biotech Ltd

‘Rossari Labtech’ was commenced as a partnership firm in specialty chemicals business in March 2003 by Mr. Edward Menezes and Mr. Sunil Chari as partners. Subsequently, by June 2009, the partnership firm was changed to a private company Rossari Biotech Limited.

Rossari Biotech (Rossari) is primarily a manufacturer of textile specialty chemicals, home, personal care and performance chemicals; and animal health and nutrition products.

Rossari provides customized solutions to specific industrial and production requirements of its customers primarily in the FMCG, apparel, poultry, and Animal feed industries.

Manufacturing and R&D Units

Rossari operates in India as well as in 17 foreign countries including Vietnam, Bangladesh, and Mauritius. However, the majority of the products are manufactured in-house from its manufacturing facility at Silvassa in the Union Territory of Dadra & Nagar Haveli. The Silvassa Manufacturing Facility has an installed capacity of 100,000 MTPA with an additional capacity of 20,000 MTPA in the process to be installed by March 2021.

They have two R&D facilities – one within the Silvassa Manufacturing Facility and another one in Mumbai.

Segments

The business is organized into three main product categories:-

  • Home, Personal care, and Performance chemicals (38%)
  • Textile specialty chemicals (52%)
  • Animal health and nutrition products (10%)

MoneyWorks4me Opinion

Rossari operates in an industry where it is a supplier to the informed buyers. Although specialty chemicals earn better margins, there is always competition in the segment. The lowest cost manufacturer will win the order from the clients. The scale of operations also plays a role in low-cost manufacturing.

The key aspect of such businesses is better execution on capacity expansion, higher asset turnover from better product realization along with better working capital management to achieve maximum ROE. ROE is never very high compared to its cost of capital as competitive bidding and informed buyers follow a cost-plus approach.

While the business is sticky, as the vendor has to undergo strict quality checks before it selects its vendors. However, the demand from end customers may lead to drop in volume growth over the next 12-18 months due to the economic slowdown in the textile segment.

As per DRHP, the peers are Galaxy Surfactants, Fine Organics, Vinati organics, Atul Limited, and Aarti Industries and their size is much higher than Rossari Biotech.

We find that the current valuation is approx. 3.5x Market Cap to FY21 sales and around 19x EV/EBITDA ratio. In comparison, Rossari trades at a valuation similar to Aarti Industries (larger and better product mix) while Sudarshan Chemicals and Fairchem trade at 2x and Atul at 3x Market Cap to Sales.

We have heard from many chemical companies that the client is facing a slowdown, this may put chemical companies at risk of slower growth and hence, valuation de-rating. We do find merit in long term structural benefit chemical companies in India enjoy. We will wait for a better valuation to enter.

We do not find Rossari as a good long term investment due to its large exposure to the textile segment, newly listed status, and high starting valuation. We find Atul, Aarti Ind, Pi Ind, Fairchem Speciality (Privi Organics), Sudarshan Chemicals, and Navin Flourine are well placed in Chemical space for long term investment.

Current IPO can be looked at only from near term bounce post listing. We have been observing aggressive buying in the mid and small-cap by retail investors. Positive sentiment in mid and small-cap and presence in the current hot sector can lead to good listing gains in this IPO. Commit only risk capital and use a stop loss mechanism (15-20% lower from purchase) to invest in IPO.

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The post Rossari Biotech Ltd IPO; Favourite sector stock may see listing gains appeared first on Investment Shastra.



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