Glenview Capital Management starts new positions in AAP, AMT, DG, NXPI, sells NTAP, ROVI—13F Flash D

Smita Nair
November 27, 2013

Glenview Capital Management starts new positions 3Q 2013 (Part 4 of 6)

(Continued from Part 3)

Glenview Capital Management is a private investment management firm with more than $7 billion of assets under management. The firm was founded in 2000 by Lawrence “Larry” Michael Robbins. It manages capital for qualified investors through a series of private investment funds. Glenview has offices in New York and London. The $7 billion is split between Glenview Funds, a short fund, and Little Arbor Funds, a multi-strategy fund. Robbins generates his returns making concentrated bets on large-cap stocks. Glenview focuses on delivering attractive absolute returns through deep fundamental research and individual security selection.

The firm started new positions in Advance Auto Parts Inc. (AAP), American Tower Corp. (AMT), Dollar General Corp. (DG), and NXP Semiconductors (NXPI) and it sold positions in NetApp (NTAP) and Rovi Corporation (ROVI).

Abbreviated financial summaries and metrics for these securities are included below. Detailed analysis and recommendations require a subscription (more information at the bottom of the article).

Why buy NXP Semiconductors NV (NXPI)?

NXP Semiconductors reported record earnings in the latest quarter, beating analyst estimates. Total revenue in the third quarter was $1,249 million, a 5% sequential increase, and nearly a 7% increase from the comparable period last year. Its core High Performance Mixed Signal (HPMS) business units saw record revenue levels, with 15% year-on-year growth. It also saw growth in its other business segments in line with its guidance, namely its Infrastructure & Industrial, Portable & Computing, Automotive, and Identification businesses. The revenue performance of the Standard products segment was slightly below expectations as a result of weaker-than-expected demand in mobile for both the Logic and Discrete businesses. For the fourth quarter, it expects strong demand for its HPMS products across multiple end markets. It anticipates product revenue to be in the range of -2% to 4% sequentially, reflecting better than historical seasonal trends. Total NXP revenue is expected to be in the range of approximately $1.22 billion to $1.29 billion.

NXP Semiconductors is a Netherlands-based global semiconductor company and a large and long-standing supplier in the industry, with over 50 years of innovation and operating history. Formerly known as Philips Semiconductors, it provides high-performance mixed-signal and standard product solutions based on its RF, analog, power management, interface, security, and digital processing expertise. More informally, NXP has characterized its strategy as focusing on “products with no big chip in the middle.” Its product solutions are used in a wide range of automotive, identification, wireless infrastructure, lighting, industrial, mobile, consumer, and computing applications.

NXPI
NXPI

Glenview Capital Management founder Lawrence “Larry” Michael Robbins graduated from the University of Pennsylvania and has a degree from the Wharton School of Engineering and the Moore School of Engineering. He has been known for his love for the healthcare sector. In a press release, Glenview stated that its investment in hospitals, which totals approximately $2.0 billion across five major U.S. hospital chains, reflects its affinity for the long-term growth and stability of the business, its recognition of the growth opportunities available through implementing expanded insurance coverage, its belief in the structural competitive advantages of for-profit hospital chains, and its excitement about the opportunities to reinvest in the industry’s strong cash flows and growing debt capacity as profitability builds through time. Robbins is known to take a more activist approach to some of his large bets, and he publicly voices his concerns about what management is doing and demands change.

Continue to Part 5

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