"Tracking John Paulsons Paulson & Company Portfolio  Q3 2014 Update"
"John Paulsons U.S. long portfolio increased from $23B to $24B this quarter.Paulson & Company's largest three positions are Shire plc, SPDR Gold ETF, and Extended Stay America.Paulson & Co. added Abbvie Inc. and increased Shire plc, Covidien plc, Time Warner Cable, and Mallinckrodt plc stakes this quarter.This article is part of a series that provides an ongoing analysis of the changes made to John Paulsons US stock portfolio on a quarterly basis. It is based on Paulsons regulatory  filed on 11/14/2014. Please visit our  to get an idea of his investment philosophy and our  highlighting the funds moves during Q2 2014.This quarter, Paulsons US long portfolio increased 4.36% from $23.08B to $24.08B. There are 75 13F securities in the portfolio although only 42 of them are significantly large holdings (more than 0.5% of the US long portfolio). The article is focused on the larger holdings. The top-five positions are Shire plc, SPDR Gold ETF, Extended Stay America, Covidien plc, and Time Warner Cable and they together account for 28% of the entire portfolio. The largest holding is Shire plc at 9.73% of the portfolio.John Paulson is best known for his highly leveraged bets against the real-estate bubble that netted him billions in the aftermath. To learn more about that story, check-out .Stake Disposals:CBS Corporation (CBS): CBS was a 1.35% of the US long portfolio position established in Q1 2014 at prices between $56.31 and $67.55. The stake was reduced by ~36% last quarter at prices between $55.94 and $63.35 and disposed of this quarter at prices between $53.50 and $64.30. The stock currently trades at $53.34. The quick about-turn indicates a bearish bias.Freeport McMoran (FCX): FCX was a 0.84% of the US long portfolio position as of last quarter. The original stake was reduced by 35% in Q1 2014 at prices between $30.50 and $38. Last quarter, the position was decreased by another ~48% at prices between $32.56 and $36.50. The remaining stake was eliminated this quarter at prices between $32.40 and $39.04. The stock currently trades at $28.08. The original FCX position was established in Q4 2012 at prices between $30.81 and $42.43. It was increased by just over 70% in Q2 2013. That increase was due to the result of Freeports acquisition of Plains Exploration & Production and McMoran Exploration - Paulson held a 3.69% position in PXP and a 1.53% position in MMR, both established in Q4 2012 as risk-arbitrage stakes.Thermo Fisher Scientific (TMO): TMO was a 1.65% of the US long portfolio stake as of last quarter. It was established in Q2 2013 at prices between $75.53 and $88.76 and was reduced by ~18% in Q4 2013 at prices between $90 and $111. Last quarter saw an additional 30% stake reduction at prices between $113 and $122 and the remaining position was eliminated this quarter at prices between $117 and $126. The stock currently trades at $125. Paulson is harvesting gains from this position.Compuware Corporation (CPWR) & Genworth Financial (GNW): These were very small 0.62% and 0.68% of the US long portfolio positions respectively that were eliminated this quarter. As the stake sizes were minutely small, the activity does not indicate a clear bias.Hillshire Brands (HSH) & Questcor Pharmaceuticals (QCOR): These two merger-arbitrage positions established last quarter were eliminated this quarter as both the mergers closed in August.  HSH was acquired by Tyson Foods (TSN) and QCOR by Mallinckrodt.New Stakes:AbbVie Inc. (ABBV): ABBV is a fairly large 3.12% of the US long portfolio stake established this quarter at prices between $52 and $59.62. The stock currently trades well above that range at $65.50. The large stake establishment indicates a bullish bias.Athlon Energy (ATHL) & PetSmart Inc. (PETM): ATHL & PETM are small 1.40% & 1.21% of the US long portfolio positions established this quarter. ATHL stake was established at prices between $41.34 and $58.32 and the stock currently trades at $58.49. On September 29, 2014 Encana (ECA) announced the acquisition of ATHL at $58.50 cash and that resulted in an immediate price spike. PETM was purchased at prices between $59.80 and $72.27 and it currently trades outside that range at $78.19.Alibaba Group (BABA): BABA is a very small 0.70% of the US long portfolio position purchased at prices between $86.10 and $93.89. The stock currently trades at $109.Stake Decreases:Aetna Inc. (AET): AET is a 2.62% of the US long portfolio position that saw a marginal reduction this quarter. The original position was established in Q4 2012 at prices between $40 and $47 and was increased substantially the following two quarters at prices between $45.50 and $63.54. It currently trades well outside those ranges at $85.55.Allergan Inc. (AGN): AGN is a merger-arbitrage stake established last quarter and reduced marginally this quarter. The stock traded between $116 and $172 last quarter and currently trades at $213. On November 18th, Actavis plc agreed to acquire Allergan Inc. in a cash-and-stock deal valued at $219 per share. The price had spiked earlier in the year due to activist involvement - Bill Ackman collaborated with Valeant Pharmaceuticals (VRX) in a bid to force a merger between VRX and AGN.AngloGold Ashanti (AU): The 1.32% AU position was reduced by ~4.5% last quarter at prices between $15.42 and $18.57. Q1 2014 also saw a ~11% reduction at prices between $11.39 and $19.36. This quarter saw marginal selling. It is a long-term position that has been in the portfolio since 2009. The stock currently trades at $9.34.Extended Stay America (STAY): STAY is Paulsons third-largest 13F position at 4.70% of the US long portfolio. The stake came about as a result of the firms IPO in November 2013. Extended Stay America filed Chapter 11 bankruptcy on June 16, 2009 and an investment group consisting of Paulson & Company, Blackstone Group, and Centerbridge Partners bought Extended Stay America out of bankruptcy in October 2010. The IPO has already made the firms more than three times their investment. It is interesting that Paulson has chosen to hold on. STAY currently trades at $18.64 compared to the IPO offering price of $20.Family Dollar Stores (FDO): FDO is a 1.74% of the US long portfolio position. It was established in Q1 2013 at prices between $54.87 and $64 and was increased by ~50% in Q2 2013 at prices between $57.42 and $65.49. Q3 2013 saw further buying as the stake was increased by another ~50% at prices between $62 and $75. The pattern reversed in Q4 2013 as ~13% of the position was sold at prices between $63.58 and $72.95. The selling increased the following quarter as the position was reduced by one-third at prices between $57 and $67.50. Last quarter saw a ~24% stake increase at prices between $56 and $69. The pattern reversed this quarter: a one-third stake reduction at prices between $60 and $80.22. The stock currently trades at $78.45.NOTE: Dollar General (DG) and Dollar Tree (DLTR) have both offered to acquire FDO.Grifols S A (GRFS): GRFS is a fairly large 2.86% of the US long portfolio position that was marginally reduced in the last two quarters. As the activity is minor, it does not indicate a change in bias.Hartford Financial Services Group (HIG): The 0.50% of the US long portfolio HIG position was first purchased in 2009. It was an activist stake and Paulson pushed for changes at the company - in Q1 2012, he called to spin-off the P&C business which he argued will increase shareholder value by 60%. He experienced some limited success but in Q1 2013, the position was reduced by 40% at prices between $22.44 and $26.46 and the following quarter saw another 45% stake reduction at prices between $24.82 and $31.43. Last quarter saw a further 25% reduction at prices between $33.30 and $36.67 and this quarter there was another 28% reduction at prices between $33.85 and $37.80. The stock currently trades at $40.80.MGM Resorts (MGM): MGM was a huge position established in Q2 2010 at prices between $9.48 and $15.89. The last few quarters have seen some selling. The stake was reduced by ~18% in Q1 2014 at prices between $23.25 and $28.29 and last quarter saw a 5% reduction at prices between $23 and $26.70. There was only very minor selling this quarter. The stock currently trades at $22.19 and the remaining position accounts for a still significant 2.13% of the US long portfolio. Paulson is harvesting long-term capital gains from this position.Oasis Petroleum (OAS): OAS was a very small 0.25% of the US long portfolio position as of Q3 2013. The stake was increased substantially to a 2.24% position in Q4 2013 at prices between $43 and $57. It was increased by an additional one-third in Q1 2014 at prices between $39 and $47. This quarter saw minor selling. The stock currently trades well below his purchase price ranges at $25.85. For investors attempting to follow Paulson, OAS is a good option to consider for further research.Tim Participaceoes S A (TSU): TSU is a small 0.50% of the US long portfolio position established last quarter at prices between $23.50 and $30.16. It was reduced by ~14% this quarter at prices between $24 and $29.64. The stock currently trades at $24.85. Telecom Italia (the parent company) has proposed the merger of its Brazilian assets (aka Tim Participaceoes) to Vivendi.Verizon Communications (VZ): VZ is a 1.56% of the US long portfolio position established in Q1 2014 as a result of Vodafones Verizon stake disposal: Paulson held Vodafone stock for which he received 0.26 shares of Verizon stock for each share of Vodafone held. VZ currently trades at $50.49. This quarter saw a ~14% reduction at prices between $48.40 and $51.97.Note: Dan Loeb of Third Point and Warren Buffett have also established significantly sized positions in VZ recently.Vodafone Group (VOD): VOD was a very small 0.57% position as of Q2 2013. It was substantially increased to a 4.53% position in Q3 2013 at prices between $28.50 and $35.12. Q4 2013 saw a ~76% stake increase at prices between $34.43 and $39.31. In Q1 2014, the share count reduced as a result of Vodafones Verizon stake disposal: VOD ADR holders received 6 new shares for 11 old shares held. They also received a $4.9 special dividend and 0.26 shares of Verizon for each share of VOD. Last quarter, the position was reduced by ~6% at prices between $32 and $38.26 and this quarter saw very minor additional selling. The stock currently trades at $35.69.Whiting Petroleum (WLL): WLL was a very small 0.31% of the US long portfolio position in Q3 2013. The stake was increased to a large 3.15% position in Q4 2013 at prices between $58 and $70. Q1 2014 saw a 9% trimming at prices between $56 and $71 and this quarter also saw minor additional selling. The stock currently trades below his purchase price ranges at $55.03. For investors attempting to follow Paulson, WLL is a very good option to consider for further research.Caesars Entertainment (CZR): CZR is a 0.69% position that was marginally reduced this quarter. The position was increased by 5.2% in Q4 2013 at prices between $16.74 and $22.39 and another 11% in Q1 2014 at prices between $19 and $26.47. The stock currently trades at $14.37. The original holding is from prior to the 02/2012 IPO.Bank of America (BAC) 2019 WTS: This is a very small 0.84% of the US long portfolio position marginally reduced this quarter. As the position size is very small, the activity does not indicate a clear bias.Stake Increases:Cobalt International Energy (CIE): CIE was a minute 0.12% of the US long portfolio stake as of Q1 2013. The position was increased to a substantial 2.63% stake in Q2 2013 at prices between $25 and $29. Q3 2013 saw a reversal, as ~17% of the position was sold at prices between $24.40 and $30.20. In Q4 2013, the position was increased by 12.5% at prices between $22.49 and $25. The stake was more than doubled in Q1 2014 at prices between $15.85 and $19.46. Last quarter, the position was again increased by 52% at prices between $17.20 and $19.36. This quarter saw marginal additional buying. The stock currently trades at $10.13 and the position stands at 2.36% of the US long portfolio. For investors attempting to follow Paulson, CIE is a good option to consider for further research.Equinix Inc. (EQIX): EQIX is a 1.92% of the US long portfolio position first purchased in Q2 2012 at prices between $147 and $175 and doubled in Q3 2012 at prices between $165 and $203. It had since been kept steady. Q2 2013 saw a reversal as the position was reduced by half at prices between $176 and $230. Q3 2013 saw a 20% stake increase at prices between $165 and $203 and that was followed-up with a 74% stake increase in Q4 2013 at prices between $155 and $184. This quarter saw marginal additional buying. The stock currently trades at $226. The aggressive stake build-up indicates a clear bullish bias.Mallinckrodt PLC (MNK): MNK is a 3.37% of the US long portfolio position established in Q3 2013 at prices between $42 and $47.20. It was increased by ~20% last quarter at prices between $60.28 and $82.70. This quarter saw an additional one-third increase at prices between $68.12 and $90. The stock currently trades at $85.98. Mallinckrodt was spun-off from Covidien plc (COV) on July 1, 2013 (one share of MNK for every eight shares of COV). Paulson took the position soon after - the stake is at around 7.9% of the entire business.Mylan Inc. (MYL): The 2.36% MYL stake was reduced by roughly one-third in Q2 2013 at prices between $28.70 and $32. The original stake was purchased in Q1 2010 at prices between $17 and $23. The position was kept relatively steady until Q1 2013 when it was reduced by a quarter at prices between $27.54 and $31. This quarter saw a minor increase. The stock trades currently at $55.68.Shire PLC ADR (SHPG): SHPG is Paulsons largest position at 9.73% of the US long portfolio. It was first established in Q3 2012 at prices between $85 and $94. In Q2 2013, the position was doubled at prices between $87 and $100. Last quarter, the stake was again increased by ~36% at prices between $142 and $236. This quarter saw a whopping ~170% increase at prices between $232 and $263. The stock currently trades at $208. On July 18, 2014, AbbVie Inc. (ABBV) agreed to buy Shire PLC for $53B but they called off the deal last month.Time Warner Cable (TWC): TWC is a large 4.37% of the US long portfolio stake established in Q3 2013 at prices between $107 and $118. The position was almost doubled in Q4 2013 at prices between $110 and $138. The aggressive stake build-up worked almost immediately as Comcast (CMCSA) agreed to buy TWC in an all-stock deal (announced 2/14/2014, 2.875 shares of CMCSA for each share of TWC held). Last quarter saw a 15% stake reduction at prices between $133 and $148. This quarter, the pattern reversed with a 42% increase at prices between $141 and $155. The stock currently trades at $144.T-Mobile USA (TMUS): The stake was acquired as a result of the reverse-merger and IPO transaction of MetroPCS with T-Mobile USA. MetroPCS was a 2.19% of the US long portfolio established in Q3 2012. This was a timely purchase for Paulson and he has large unrealized gains. The TMUS stake was increased by ~17% to a 3.25% of the US long portfolio position in Q3 2013 at prices between $23 and $26.12. Q1 2014 saw a ~17% stake reduction at prices between $29.53 and $33.64 and last quarter saw a further ~18% reduction at prices between $28.10 and $34.86. This quarter, the pattern reversed with a ~14% increase at prices between $28.44 and $33.91. The stock currently trades at $27.45.Actavis plc (ACT): ACT was a minutely small 0.29% of the US long portfolio position last quarter. It was increased by just over 250% this quarter to a ~1% stake at prices between $202 and $248. The stock currently trades at $266.HCA Holdings (HCA): HCA was a small 0.83% of the US long portfolio position last quarter. It was increased by almost 80% this quarter at prices between $54.52 and $73.48. The stock currently trades at $67.04. The activity indicates a bullish bias.Popular Inc. (BPOP): The 1.10% BPOP stake was marginally increased this quarter. The activity is very minor to indicate a clear bias.Covidien plc (COV) & DirecTV (DTV): These positions, established last quarter are merger arbitrage positions. The COV position was increased by ~80% this quarter at prices between $82.54 and $91.76 and the stock currently trades at $97.50. The stake is at 4.52% of the portfolio. DTV position was marginally increased to a 3.74% stake this quarter. COV is getting acquired by Medtronic (MDT) while AT&T (T) is acquiring DTV.Kept Steady:Caesars Acquisition Company (CACQ): CACQ is a 0.48% of the US long portfolio stake established in Q4 2013 and reduced marginally last quarter. Caesars Acquisition is a spin-off from Caesars Entertainment and the terms of the deal allowed existing shareholders to get CACQ shares at $9.43 (rights offering). Paulson probably took this option to establish the position. The stock currently trades at $10.19.Cablevision Systems (CVC): CVC is a 1.40% of the US long portfolio stake that was first purchased in Q4 2012 at prices between $13.65 and $18.52. In Q1 2013, the position was increased by around one-third at prices between $13.76 and $15.75. Q2 2013 saw an additional 24% stake increase at prices between $13.93 and $16.82. Q1 2014 saw an about-turn as around 8% of the position was sold at prices between $15.85 and $18.15. The stock currently trades at $18.93.Dollar General (DG): The ~1% of the US long portfolio DG position was established in Q1 2014 at prices between $55 and $63 and doubled last quarter at prices between $53.50 and $62.82. The stock currently trades at $66.10.Houghton Mifflin Harcourt (HMHC): HMHC is a 2.50% of the US long portfolio position established in Q4 2013 as a result of its November 2013 IPO. The company filed for Chapter 11 bankruptcy protection in March 2012. Paulson held senior debt that got converted into equity. The IPO was priced at $12 per share and it currently trades at $19.94.Kodiak Oil & Gas (KOG): KOG is a 1.46% position purchased in Q2 2013 at prices between $7.47 and $9.60. It was almost doubled in Q3 2013 at prices between $8.42 and $12.06. The stock currently trades at $9.76.Realogy Holdings (RLGY): RLGY is a 1.85% of the US long portfolio position that was kept steady in the last four quarters. The original investment was made prior to the October 2012 IPO. The stock is currently trading at $42.94 and shows a return of around ~28% since IPO.SPDR Gold Trust (GLD): GLD was Paulsons largest position by far at 19.03% of the US long portfolio as of Q1 2013. It was reduced by more than half in Q2 2013 at prices between $116 and $155. The original stake was established in Q1 2009 at prices between $82.71 and $97.80. It was reduced by ~45% in 2011 at much higher prices and since then had been kept relatively steady. The stock currently trades at $114. The position was kept steady in the last five quarters and it is currently his second-largest 13F position at 4.94% of the US long portfolio.Sprint (S): S was Paulsons largest position in Q2 2013 at 9.90% of the US long portfolio. The stake was established in Q4 2012 and doubled in Q1 2013. In Q3 2013, the position was reduced to a 2.27% position at prices between $5.50 and $7.25. Q4 2013 saw a 13% stake increase at prices between $5.97 and $10.79. The stock currently trades at $4.71.Radian Group (RDN), Novagold (NG), & MGIC Investment (MTG): These are small positions (less than 1.5% of the US long portfolio) that were left untouched this quarter.Other very small positions (less than 0.5% of the US long portfolio each) in the portfolio include Agnico Eagle Mines (AEM), Allied Nevada Gold (ANV), Auxilium Pharmaceuticals (AUXL), BAC 2018 WTS, Delphi Automotive (DLPH), Dex Media (DXM), Enzymotec Ltd. (ENZY), Felcor Lodging (FCH), Gold Fields Ltd. (GFI), Gulf Coast Ultra Deep Royalty (GULTU), Howard Hughes Corporation (HHC), International Tower Hill, Iamgold Corp. (IAG), Kamada Ltd. (KMDA), Measurement Specialties (MEAS), Move Inc. (MOVE), Novacopper Inc. (NCQ), Post Holdings Inc. (POST), Gold Res. Ltd. ADR, Repros Therapeutics (RPRX), Rock-Tenn Co. (RKT), Sibanye Gold (SBGL), Strategic Hotels & Resorts (BEE), Sunstone Hotel Investments (SHO), Taminco Corporation (TAM), Valeant Pharmaceuticals (VRX), Vanda Pharma (VNDA), Whitewave Foods (WWAV), and William Lyon Homes (WLH).The spreadsheet below highlights changes to Paulsons US stock holdings in Q3 2014:"