Hedge funds have a strong influence over the marketplace. These funds have billions under management and can move in on a stock to make money or changes to the business. For activist hedge fund manager, Barry Rosenstein he chooses both sides.
Recently, the manager of Jana Partners bought a huge stake in Apple and Marathon Petroleum Corp. Marathon Petroleum is now his largest position with his purchase of 16.6 million share valuing around $553 million or 25% of his entire portfolio.
Khrom Capital was up 32.5% gross and 24.5% net for the first quarter, outperforming the Russell 2000's 21.2% gain and the S&P 500's 6.2% increase. The fund has an annualized return of 21.6% gross and 16.5% net since inception. The total gross return since inception is 1,194%. Q1 2021 hedge fund letters, conferences and more Read More
Rosenstein made news late last year after he had been pressuring McGraw Hill (his largest holding at the time) to split into two separate businesses to maximize its value. In September, McGraw Hill announced that it would indeed be separating itself into two separate entities, a huge win for Rosenstein. However, his activist stances have been felt elsewhere such as El Paso. The hedge fund manager successfully blocked El Paso’s buyout in Charles River Laboratories. Jana Partners cut its stake in El Paso once Kinder Morgan announced it was going to buy out the company.
Since Jana Partners manages more than $100 million in assets, it is required to release a 13F filing 45 days after the end of the quarter. Because of this, we are able to view what Barry Rosenstein is buying and selling. After viewing the fourth quarter filing we have found some interesting developments. We can see that he added 13 new stocks to his portfolio, ranging from energy to technology. However, the most shocking was his new stake in Netflix, the beaten down internet movie rental company.
Could Barry Rosenstein be using Netflix as an activist target? Who knows but one thing is for sure, the hedge fund manager sees some sort of potential in the company and its stock. Not to mention he has shown his abilities to use his shareholder influence to make changes to the business, changes that have historically worked. This could be a turning point for Netflix, after it lost most of its customers due to a rate increase and transferring its DVD business into a separate entity.
The jury is still out on a Netflix revival but one thing is for sure, Barry Rosenstein will have his voice heard one way or another. Keep your eyes out for any intervention he might have in Netflix because it could spell p-r-o-f-i-t-s for investors. Whitney Tilson is probably liking this news as well….