Viking Global Investors starts new positions 3Q 2013 (Part 3 of 5)
Viking Global Investors LP is an independent hedge fund management firm founded by Andreas Halvorsen, Brian Olson, and David Ott. It manages assets of around $20 billion and has offices in New York City, Greenwich, Connecticut, and Tokyo.
In Q3 2013, it started new positions in Lowe’s Cos. Inc. (LOW), Bank of America Corp. (BAC), The Walt Disney Co. (DIS), and Baidu Inc. (BIDU) and it sold Boeing Co. (BA) and Cemex SAB de CV (CX).
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 purchase Baidu (BIDU)?
Chinese search giant Baidu reported strong results in the third quarter as revenue remained on a solid growth trajectory. Mobile search revenues in particular saw an increase. In terms of guidance, the company expects total revenues for the fourth quarter to be between $1.51 billion and $1.55 billion, representing a 45.5%-to-49.6% year-over-year increase. The company is stepping up efforts to expand into the mobile search and software applications segment.
With the acquisition of 91 Wireless at the end of July, Baidu has strengthened its mobile native app distribution capabilities. It also introduced search-enabled Light Apps, which will allow users to more easily discover long-tail app content and offer developers a powerful distribution channel in Baidu mobile search. The company has also forayed into the financial services segment by launching Baidu Finance Centre in cooperation with China Asset Management. It aims to offer depositors an 8% annual return. With this launch, Baidu will compete with Alibaba and Tencent Holdings, which already offer financial products.
Viking Global Investors founder Andreas Halvorsen is a Tiger Cub, having previously worked at legendary investor Julian Robertson’s Tiger Management. The firm follows a global long-short equity strategy. It conducts fundamental research-intensive stock selection across all industries and uses a bottom-up approach in analyzing stocks. Rather than undertaking analysis to explain past performance, Viking Global Investors analyzes its existing portfolio to anticipate future performance. Investors meet with company management and conduct background checks on key personnel, interview suppliers, customers, and competitors. The firm’s portfolio managers review the company’s products and services and consult with industry experts. The fund’s investments are primarily in equity securities, but it also has holdings in debt, credit, derivative, and other financial instruments.
Browse this series on Market Realist:
- Part 1 - Viking Global Investors starts new positions in LOW, BAC, DIS, BIDU, Sells BA, CX – 13F Flash (A)
- Part 2 - Viking Global Investors starts new positions in LOW, BAC, DIS, BIDU, Sells BA, CX – 13F Flash (B)
- Part 4 - Viking Global Investors starts new positions in LOW, BAC, DIS, BIDU, Sells BA, CX – 13F Flash (D)
- Private Equity & Hedge Funds