Soros Fund Management starts new positions in MSFT, FDX, TEVA, HAL, Sells DAL, UAL – 13F Flash

Market Realist

Soros Fund Management is a large private fund run by the legendary team of famed investor George Soros. In Q3 2013, it started new positions in Microsoft Corp. (MSFT), Fedex Corp. (FDX), Teva Pharmaceuticals (TEVA), and Halliburton (HAL), and sold Delta Airlines (DAL) and United Continental Holdings (UAL).

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).

Microsoft Corp. (MSFT):

Microsoft was founded in 1975. The Company’s mission is to enable people and businesses throughout the world to realize their full potential by creating technology that transforms the way people work, play, and communicate. It develops and markets software, services, and hardware devices that deliver new opportunities, greater convenience, and enhanced value to people’s lives. MSFT does business worldwide and has offices in more than 100 countries.

Microsoft generates revenue by developing, licensing, and supporting a wide range of software products and services, by designing and selling hardware devices, and by delivering relevant online advertising to a global customer audience. In addition to selling individual products and services, it offers suites of products and services.

MSFT’s products include operating systems for computing devices, servers, phones, and other intelligent devices; server applications for distributed computing environments; productivity applications; business solution applications; desktop and server management tools; software development tools; video games; and online advertising. It also designs and sells hardware devices including Surface RT and Surface Pro, the Xbox 360 gaming and entertainment console, Kinect for Xbox 360, Xbox 360 accessories, and Microsoft PC accessories.

MSFT offers cloud-based solutions that provide customers with software, services, and content over the Internet by way of shared computing resources located in centralized data centers. Examples of cloud-based computing services it offers include Microsoft Office 365, Microsoft Dynamics CRM Online, Windows Azure, Bing, Skype, Xbox LIVE, and Yammer. Cloud revenue is earned primarily from usage fees, advertising, and subscriptions. The Company also provides consulting and product and solution support services, and it trains and certifies computer system integrators and developers.

Fedex Corp. (FDX):

FedEx Corporation (“FedEx”) provides a broad portfolio of transportation, e-commerce and business services through companies competing collectively, operating independently and managed collaboratively, under the respected FedEx brand. These companies are included in four business segments:

FedEx Express: Federal Express Corporation (“FedEx Express”) is the world’s largest express transportation company, offering time-certain delivery to more than 220 countries and territories, connecting markets that comprise more than 90% of the world’s gross domestic product. The FedEx Express segment also includes FedEx Trade Networks, Inc., which provides international trade services, specializing in customs brokerage and global ocean and air freight forwarding, and FedEx SupplyChain Systems, Inc., which offers a range of supply chain solutions.

FedEx Ground: FedEx Ground Package System, Inc. (“FedEx Ground”) is a leading North American provider of small-package ground delivery services. FedEx Ground provides low-cost, day-certain service to every business address in the United States and Canada, as well as residential delivery to nearly 100% of U.S. residences through its FedEx Home Delivery service. The FedEx Ground segment also includes FedEx SmartPost, Inc., which specializes in the consolidation and delivery of high volumes of low-weight, less time-sensitive business-to-consumer packages using the U.S. Postal Service (“USPS”) for final delivery to any residential address or PO Box in the United States.

FedEx Freight: FedEx Freight, Inc. (“FedEx Freight”) is a leading North American provider of less-than-truckload (“LTL”) freight services across all lengths of haul, offering: FedEx Freight Priority, when speed is critical to meet supply chain needs; and FedEx Freight Economy, when time can be traded for cost savings. The FedEx Freight segment also offers freight delivery service to most points in Canada, Mexico, Puerto Rico and the U.S. Virgin Islands and includes FedEx Custom Critical, Inc., a leading North American provider of time-specific, critical shipment services.

FedEx Services: FedEx Corporate Services, Inc. (“FedEx Services”) provides its other companies with sales, marketing, information technology, communications and back-office support. The FedEx Services segment also includes FedEx TechConnect, Inc., which is responsible for customer service, billings and collections for its U.S. customers and offers technical support services, and FedEx Office and Print Services, Inc. (“FedEx Office”), which provides document and business services and retail access to its package transportation businesses.

Teva Pharmaceuticals (TEVA):

Teva is an Israel based global pharmaceutical company. Established in 1901, it ranks among the 10 top pharmaceutical firms in the world. Teva is active in 60 countries, with over 46,000 dedicated employees worldwide.

As a forward-looking global pharmaceutical company, Teva spearheads the development, production and marketing of a wide range of specialty medicines, generic and OTC products, active pharmaceutical ingredients (API) and novel new therapeutic entities.

Halliburton (HAL):

Halliburton Company’s predecessor was established in 1919 and incorporated under the laws of the State of Delaware in 1924. The Company is a leading provider of services and products to the energy industry related to the exploration, development, and production of oil and natural gas. It serves major, national, and independent oil and natural gas companies throughout the world and operates under two divisions, the Completion and Production segment and the Drilling and Evaluation segment:

The Completion and Production segment delivers cementing, stimulation, intervention, pressure control, specialty chemicals, artificial lift, and completion services. The segment consists of Halliburton Production Enhancement, Cementing, Completion Tools, Boots & Coots, and Multi-Chem. Effective January 1, 2013, Halliburton Artificial Lift will be included as a product service line within this segment.

The Drilling and Evaluation segment provides field and reservoir modeling, drilling, evaluation, and wellbore placement solutions that enable customers to model, measure, and optimize their well construction activities. The segment consists of Halliburton Drill Bits and Services, Wireline and Perforating, Testing and Subsea, Baroid, Sperry Drilling, Landmark Software and Services, and Halliburton Consulting and Project Management.

Halliburton has significant manufacturing operations in various locations, including the United States, Canada, Malaysia, Mexico, Singapore, and the United Kingdom.

Delta Airlines (DAL):

Delta Airlines provides scheduled air transportation for passengers and cargo throughout the United States and around the world. Its global route network gives it a presence in every major domestic and international market. Its route network is centered around a system of hub and international gateway airports that it operates in Amsterdam, Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York – LaGuardia, New York-JFK, Paris-Charles de Gaulle, Salt Lake City, Seattle and Tokyo-Narita. Each of these hub operations includes flights that gather and distribute traffic from markets in the geographic region surrounding the hub or gateway to domestic and international cities and to other hubs or gateways. Its network is supported by a fleet of aircraft that is varied in terms of size and capabilities, giving us flexibility to adjust aircraft to the network.

Other key characteristics of its route network include:

  • Its alliances with foreign airlines, including our membership in SkyTeam, a global airline alliance
  • Its international joint ventures, particularly our transatlantic joint venture with Air France-KLM and Alitalia
  • Its domestic marketing alliance with Alaska Airlines, which expands its west coast service; and agreements with multiple domestic regional carriers, which operate as Delta Connection.

Delta is incorporated under the laws of the State of Delaware. Its principal executive offices are located at Hartsfield-Jackson Atlanta International Airport in Atlanta, Georgia.

United Continental Holdings (UAL):

United Continental Holdings, Inc. is a holding company and its principal, wholly-owned subsidiaries are United Air Lines, Inc. and Continental Airlines, Inc. This combined Annual Report on Form 10-K is separately filed by each of United Continental Holdings, Inc., United Air Lines, Inc. and Continental Airlines, Inc.

The Company transports people and cargo through its mainline operations, which use jet aircraft with at least 110 seats, and its regional operations.

With key global air rights in the U.S., Asia-Pacific, Europe, Middle East, Africa, and Latin America, UAL has the world’s most comprehensive global route network. UAL, through United and Continental and their regional carriers, operates more than 5,500 daily flights to more than 375 U.S. and international destinations from the Company’s hubs at Newark Liberty International Airport (“Newark Liberty”), Chicago O’Hare International Airport (“Chicago O’Hare”), Denver International Airport (“Denver”), George Bush Intercontinental Airport (“Houston Bush”), Hopkins International Airport (“Cleveland Hopkins”), Los Angeles International Airport (“LAX”), A.B. Won Pat International Airport (“Guam”), San Francisco International Airport (“SFO”) and Washington Dulles International Airport (“Washington Dulles”).

UAL was incorporated under the laws of the State of Delaware on December 30, 1968. Its world headquarters is located at 233 South Wacker Drive, Chicago, Illinois.

Soros Fund Management was formerly a famed global macro hedge fund run by George Soros, a multi-billionaire investor, who is famous for betting against the British pound earlier in his career. The fund was started in 1969 and in 2010 was reported to be one of the most profitable hedge funds in history, earning over 20% annual returns over 40+ years. The firm formerly was the adviser to the famous Quantum group of funds, but now is private.

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