"Tracking Dan Loeb’s Third Point Portfolio – Q2 2021 Update"
"Dan Loeb's 13F portfolio value increased from $14.83B to $17.08B this quarter. The number of positions increased from 125 to 126.Third Point added SoFi Technologies and increased Intel Corp & Cano Health during the quarter. They also dropped IAA Inc. and reduced Charter Communications.The top three positions are at ~21% of the portfolio: Upstart Holdings, SentinelOne, and PG&E Corp.This article is part of a series that provides an ongoing analysis of the changes made to Dan Loeb’s 13F stock portfolio on a quarterly basis. It is based on Third Point’s regulatory  filed on 8/16/2021. Please visit our  to get an idea of their investment philosophy and our  for the fund’s moves during Q1 2021.This quarter, Loeb’s 13F portfolio value increased ~15% from $14.83B to $17.08B. The 13F portfolio is very concentrated with the top three holdings accounting for ~21% of the entire portfolio. The number of holdings increased from 125 to 126. 40 of the holdings are significantly large (more than ~0.5% of the portfolio each) and they are the focus of this article. The largest five individual stock positions are Upstart Holdings, SentinelOne, PG&E, Intel Corp, and Danaher Corp.Third Point returned 14.7% thru July this year compared to 18% for the S&P 500 Index. Annualized returns since December 1996 inception are at 15% compared to 9.4% for the S&P 500 Index. AUM is distributed among several strategies of which the long/short equity portion is the majority: of the roughly two-thirds net portfolio exposure, 121.8% (over 100% due to leverage) is the net-long equity portion. In addition to partner stakes, Third Point also invests the float of Sirius Point (SPNT) and capital from London listed closed-end fund Third Point Offshore (TPNTF). To know more about Dan Loeb's Third Point, check-out his letters to shareholders at their site. His activist investing style is covered in the book "".Note 1: although the positions relative to the size of the portfolio are very small, they have significant ownership stakes in the following businesses: 4.4% of Kadmon Holdings (KDMN) and 5.6% of Global Blue (GB). In addition, they have significant ownership stakes in several SPACs including participation in the PIPEs of two crypto de-SPAC deals – Fintech Acquisition V (FTCV) which announced a deal for eToro in March and Concord Acquisition (CND) which announced a deal for Circle in July.Note 2: Large equity investments not in the 13F report include Sony (SONY), EssilorLuxottica (ESLOY), and Nestle (NSRGY). All three are activist stakes. SONY is a $1.5B investment made in June 2019 when the stock was trading at around $50 per share. It is currently at ~$109. The ESLOY investment was made in early 2019 when the stock was trading at ~$62.50 per share. It currently trades at $98.77. The NSRGY position is from 2017 and the stock has rallied ~75% since. Also, they have a significant portfolio of investments thru their venture firm . Such stakes include investments in Yellowbrick Data, Aryaka, Kentik, Kumu Networks, Ushur, CipherTrace, Bitwise, FTX, etc.New Stakes:SentinelOne (S): The large (top three) 6.31% of the portfolio SentinelOne stake goes back to 2015 when they led the Series B funding round at a post-money valuation of $98M. They participated in each subsequent round as well as the IPO and after-market. The stock currently trades at $63.88 at a valuation of ~$17B – their initial 2015 investment has so far returned a stunning ~170x.SoFi Technologies (SOFI): SOFI is a 3.24% of the portfolio position established this quarter at prices between ~$14.50 and ~$24 and the stock currently trades near the bottom of that range at $14.57.Note: Social Capital Hedosophia V merged with SoFi in a de-SPAC deal that closed in June.Endeavor Group Holdings (EDR): EDR had an IPO in April. Shares started trading at ~$25 and currently goes for ~$26. Third Point’s position goes back to a private placement done concurrent with the IPO.Note: Endeavor Group Holdings used part of the proceeds from the IPO and private placement to fund the acquisition of a ~50% stake in Ultimate Fighting Championship (UFC) that they did not already own.Didi Global (DIDI): DIDI had an IPO in June. Shares started trading at ~$15.50 and currently goes for ~$7.75. Third Point’s position goes back to a funding round in 2016 when the valuation was ~$30B. The current valuation is ~$37B.Zimmer Biomet Holdings (ZBH): ZBH is a very small 0.75% of the portfolio stake established this quarter.Stake Disposals:IAA Inc. (IAA): IAA was a 3.23% of the portfolio stake established in Q4 2019 at prices between $36 and $47. Q2 2020 saw a ~63% stake increase at prices between $25 and $45. IAA is a June 2019 spinoff of the salvage auction business of KAR Auctions (KAR). It started trading at ~$40 and currently goes for $52.26. There was a ~12% trimming last quarter. The disposal this quarter was at prices between ~$53 and ~$63.Note: Their ownership stake in the business as of last quarter was ~6%.Ferrari NV (RACE): RACE was a 1.39% of the portfolio position built in H2 2020 at prices between ~$130 and ~$180. Last quarter saw a ~9% trimming. The elimination this quarter was at prices between ~$196 and ~$219. The stock currently trades at ~$213.Carvana (CVNA), CarMax Inc. (KMX), ContextLogic (WISH), Equitrans Midstream (ETRN), Shopify (SHOP), and Zillow Group (Z): These very small (less than ~1% of the portfolio each) stakes were disposed during the quarter.Stake Increases:Intel Corp (INTC): INTC is a large (top five) 4.60% of the portfolio position built this quarter at prices between ~$53.50 and ~$68. The stock currently trades just below the low end of that range at ~$53.Amazon.com (AMZN): AMZN is a 2.92% of the portfolio position purchased in Q4 2019 at prices between $1705 and $1870. The stake saw a ~200% increase in Q1 2020 at prices between $1677 and $2170. The stock is now well above those ranges at ~$3356. There was a ~30% selling in Q4 2020 at prices between ~$3005 and ~$3444. Last quarter saw another ~20% reduction at prices between ~$2951 and ~$3380 while this quarter there was a ~27% stake increase at prices between ~$3094 and ~$3505.CoStar Group (CSGP): CSGP is a 2.75% of the portfolio position purchased last quarter at prices between ~$76 and ~$94 and the stock currently trades at $88.72. There was a minor increase this quarter.Note: their investment thesis is that CoStar Group’s Ten-X acquisition should result in a second tailwind – “Bloomberg of CRE” to also be “Nasdaq of CRE” – cross-selling should result in revenue growth acceleration to 20% and EBITDA growth from 20% to 30% over time.Uber Technologies (UBER): UBER is a 2.45% of the portfolio position purchased last quarter at prices between ~$48 and ~$63. There was a ~25% stake increase this quarter at prices between ~$44 and ~$61. The stock currently trades well below those ranges at $39.79.Note: Ride-sharing is a popular theme in Third Point’s portfolio. They had a successful exit from Lyft (LYFT) and currently has stakes in Didi and Grab Holdings. The stake in Grab Holdings & Didi Global go back to funding rounds from 2016. Also, they have a position in Altimeter Growth (AGC) both from purchasing equity and committing to participation in the PIPE - AGC is merging with Grab Holdings in the largest de-SPAC deal announced so far.Estee Lauder (EL): The ~2% EL stake was built over the last three quarters at prices between ~$218 and ~$318 and the stock currently trades near the top of that range at ~$311.Dell Technologies (DELL): DELL is a 1.84% of the portfolio position built over the last two quarters at prices between ~$88 and ~$104 and it is now at ~$101.Dupont De Nemours (DD): The 1.35% of the portfolio stake in DD was established last quarter at prices between ~$69 and ~$86 and it is now just below that range at ~$68. There was a ~11% stake increase this quarter.Black Knight Inc. (BKI), Cano Health (CANO), RH Inc. (RH), and Suncor Energy (SU): These small (less than ~1.15% of the portfolio each) stakes were increased during the quarter.Stake Decreases:PG&E Corp (PCG): PCG is currently the third-largest 13F stake at 6.55% of the portfolio. Third Point’s Q2 2020 letter had the following regarding the investment in PG&E – the position came about as a result of participating in a PIPE (terms for the exit financing called for up to $10.50 per share purchase price). They believed the stock was undervalued as there are several risk mitigation measures in place – wildfire fund (insurance against wildfires), $3B per year investments in wildfire safety, ESG plans, etc. The stock currently trades at $9.58. There was minor trimming in the last two quarters.Danaher Corp. (DHR): The top five 4.50% DHR stake was established in Q3 2015 at prices between $60.90 and $71.50 and increased by two-thirds in Q1 2016 at prices between $62 and $74. There was a ~20% stake increase in Q1 2019 at prices between $98 and $132 while H1 2020 saw a ~20% selling at prices between $129 and $177. It currently trades at ~$324. Last two quarters saw minor trimming.Note: The prices quoted above are adjusted for the Fortive (FTV) spin-off in July 2016.Walt Disney (DIS): DIS is currently at 4.27% of the portfolio. It was purchased in Q1 2020 at prices between $85 and $148. Next quarter saw a ~300% stake increase at prices between $94 and $127. The stock currently trades at ~$179. There was a ~13% selling last quarter and that was followed with a marginal reduction this quarter.Intuit Inc. (INTU): INTU is a 3.16% of the portfolio stake built over the last four quarters at prices between ~$218 and ~$422. The stock currently trades at ~$554. This quarter saw a ~8% trimming.Alphabet Inc. (GOOG): GOOG is a 2.86% of the portfolio position purchased in Q4 2020 at prices between ~$1453 and ~$1828 and the stock is now well above that range at ~$2780. There was a ~20% reduction last quarter at prices between ~$1728 and ~$2138. This quarter saw a ~5% trimming.Burlington Stores (BURL): The 2.79% portfolio stake in BURL was established in Q2 2019 at prices between $146 and $177. The position saw a ~115% stake increase next quarter at prices between $168 and $205. Q1 2020 saw a ~20% selling at prices between $121 and $248 while next quarter there was a similar increase at prices between $141 and $217. Q3 2020 also saw a ~20% stake increase at prices between ~$171 and ~$217. The stock currently trades at ~$292. There was a ~12% trimming over the last two quarters.Avantor Inc. (AVTR): The 2.18% AVTR stake was established in Q3 2020 at prices between ~$17 and ~$23 and increased by ~235% next quarter at prices between ~$22.50 and ~$28. The stock currently trades at $42.52. There was a ~5% trimming this quarter.Iqvia Holdings (IQV): The 1.77% IQV position was purchased in Q3 2018 at prices between $99 and $131 and increased by ~25% in Q3 2019 at prices between $143 and $162. There was a one-third selling this quarter at prices between ~$193 and ~$247. The stock currently trades at ~$253.TransDigm Group (TDG): The 1.71% TDG stake was purchased in Q3 2020 at prices between ~$411 and ~$519 and it is currently well above that range at ~$615. There was a ~12% stake increase in Q4 2020. This quarter saw a ~7% trimming.JD.com (JD): JD is a 1.35% of the portfolio stake established in Q2 2020 at prices between $40 and $62 and the stock currently trades at ~$74. There was a ~35% stake increase in Q3 2020 at prices between ~$60 and ~$83 while next quarter saw a ~25% selling at prices between ~$76 and ~$93. Last two quarters have also seen a combined ~15% trimming.Aptiv plc (APTV), Charter Communications (CHTR), and TE Connectivity (TEL): These small (less than ~1.20% of the portfolio each) stakes were reduced this quarter.Kept Steady:Upstart Holdings (UPST): UPST is currently the largest position at ~10% of the portfolio. Third Point’s original position goes back to a Series C funding round in 2015 when the business was valued at ~$180M. They also added 1.2M shares in the December IPO. UPST started trading at ~$44 and currently goes for ~$294.Note: They have a ~15% stake in Upstart Holdings and are sitting on gains of over 7x from ~$206M in total investments (~$66M six years ago and ~$140M at IPO).Paysafe Limited (PSFE): PSFE is a 2.94% of the portfolio position established last quarter at ~$10 per share as Third Point led the PIPE of this de-SPAC. The stock currently trades at ~$8.Note: their Paysafe investment thesis is that as US is poised to become the largest online gambling market globally, Paysafe is positioned well to take advantage.Microsoft Corp (MSFT): The 2.54% of the portfolio MSFT stake was purchased in Q3 2020 at prices between ~$200 and ~$232. Last two quarters had seen a ~60% stake increase at prices between ~$200 and ~$245. The stock currently trades at ~$294.S&P Global (SPGI): SPGI is a 2.40% stake established in Q2 2016 at prices between $96 and $128. The position has wavered. Recent activity follows: the five quarters thru Q1 2019 saw a combined ~60% selling at prices between $164 and $213. There was a ~30% stake increase over the last two quarters at prices between ~$306 and ~$379. The stock is now at ~$445.Visa Inc. (V): The ~2% Visa stake was established in Q2 2018 at prices between $118 and $136. The stock is now well above that range at ~$220. H1 2020 had seen a ~17% reduction at prices between $136 and $213 while next quarter there was a ~25% stake increase at prices between ~$189 and ~$217.Facebook Inc. (FB): The ~2% FB position was purchased in Q2 2020 at prices between $154 and $242 and the stock is now at ~$356. Q3 2020 saw a one-third stake increase at prices between ~$230 and ~$304. There was a ~9% trimming last quarter.Catalent Inc. (CTLT), Global Blue Group Holding AG (GB), Leslie’s Inc. (LESL), PG&E (PCG) Units, and  UnitedHealth (UNH): These small (less than ~1.5% of the portfolio each) stakes were kept steady this quarter.The spreadsheet below highlights changes to Loeb’s 13F stock holdings in Q2 2021:Source: John Vincent. Data constructed from Third Point’s 13F filings for Q1 2021 and Q2 2021.12/30/2020 - $1B activist  in Intel revealed.Q1 2021 Letter, April Report, etc - -  .: Performance: thru April 13% vs 11.8% for S&P 500 index. 15.1% since 1996 inception vs 9.1% for S&P 500 Index. Exposure: 118.6% long and 39.5% short for a net exposure of 79.2% as of April. SentinelOne and Upstart – investments made roughly six years ago at $145M (~$11.4B as of 5/31/2021 – 15% stake - ~$1.4B current value - $66M invested over the years along with 1.2M shares at IPO) and $73M valuations respectively. eToro & PaySafe – led the PIPEs – eToro has a long growth runway, diversified income streams (equities, commodities, currencies, and crypto), and call option from its entry into the US. PaySafe is the payments facilitator for most of online gambling with a two-sided consumer-merchant offering via digital wallet (Skrill & Neteller) – US poised to become largest online gambling market globally and PaySafe is positioned well to take advantage.Regulatory filings from 3/7/2021 thru 5/31/2021: 13G/A – 5/28 – KDMN – 7.6M shares – 4.4% of business. 13D/A – 3/30 – Global Blue – GB – 10.45M shares – 5.6% of business. 3/25 Form 4, 3/29 13G, Form 3 – Fintech Acq. V – FTCV – 3M shares – 11.7% of business – 85.5K shares purchased at 11.4828. Form 4 – 3/5 – Radius Global Infrastructure – RADI – minor 4.495M shares total. Grab – invested from growth capital stages to IPO - ride sharing is a theme for them having invested in Lyft (exited) and Didi (currently). 1/2016 raise to grow in mobility, food delivery, and financial services. Personal connection with Dan around that time. 2020 showed resilience. Also creation of Singapore’s first digital bank. Marketshare growth against Gojek, etc. Lending, insurance, and investment management are big areas of potential. Costar Group – got during the lows in March – high-quality compounder in the early innings of a transformational new opportunity which could meaningfully accelerate earnings growth. Last 30 years was ACT 1 – “Bloomberg of CRE”. ACT 2 – “Nasdaq of CRE” – transactional marketplace where properties can be bought and sold online – Ten-X acquisition – CRE auction website with 90% market share. Cross-selling should result in revenue growth acceleration from mid-teens to 20% and EBITDA growth from 20% to 30% over time."