He beneficially now owns 22.81 million shares in the USA’s largest automotive retailer, which boasts of 273 new vehicle franchises that sell 33 new vehicle brands over 15 states.
Here’s a round up of hedge funds’ May returns
Tyro Absolute Return Fund was down 1.5% for May. The fund's main contributors in May were Super Micro Computer, which gained 1.6%, Shyft Group, which was up 1%, and GCI Liberty, which gained 1%. Detractors in May include Recro Pharma, which fell 2.6%, index shorts and hedges, which declined 2%, and DXC Technology, which was Read More
Holdings down from June
A 13D filing in June showed he held 26.20 million shares in AutoNation, Inc. (NYSE:AN) amounting to a 21.9% stake.
At one time Lampert had a massive holding of 80 million shares in the auto retailer, but has been steadily selling out the stock since the first quarter of 2010. It has been a hugely successful investment for Lampert – tripling in value since 2009.
AutoNation, Inc. (NYSE:AN) is up 7.31% year to date, and up 11.32% over the past 12 months. However the stock lost nearly 11% this past month.
Last month analysts at UBS rated the stock as a Sell with a price target of $43, though the company reported sales of 25,450 new vehicles during the month of June 2014. This was the best June month since 2007. Goldman Sachs, however, upgraded the stock to a Buy rating last month and has a price target of $65.
For the second quarter, the company reported EPS of $0.83 and revenue of $4.8 billion. The EPS reported was the highest ever for the second quarter, and it was the 15th straight quarter of double-digit year-on-year growth in EPS.
However, the number missed market expectations by $0.04, resulting in weakness in the stock price.
AutoNation, Inc.(NYSE:AN) will report third quarter earnings on October 22. Analysts expect EPS of $0.86 and revenue of $4.74 billion.
Motives for selling
It is likely that Lampert is selling into strength and booking profits steadily. Last year, he distributed $393 million worth of his AutoNation, Inc.(NYSE:AN) holdings to clients looking to redeem out of his hedge fund that has a substantial stake in struggling retailer Sears Holdings Corp(NASDAQ:SHLD).
This means that the weightage of Sears Holdings Corp (NASDAQ:SHLD) in Lampert’s basket is steadily growing – perhaps not a healthy sign given that the retailer’s last five quarters have all generated net losses.