"Tracking John Paulsons Paulson & Company Portfolio  Q4 2015 Update"
"John Paulsons U.S. long portfolio decreased from $19.27B to $16.73B this quarter.Paulson & Company's largest three positions are Allergan plc, Shire plc, and Valeant Pharmaceuticals.Paulson increased Valeant Pharmaceuticals and Mallickrodt plc substantially during the 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 02/16/2016. Please visit our  to get an idea of his investment philosophy and our  highlighting the funds moves during Q3 2015.This quarter, Paulsons US long portfolio decreased ~13% from $19.27B to $16.73B. There are 77 13F securities in the portfolio although only 31 of them are significantly large equity holdings (more than 0.5% of the US long portfolio). The article is focused on the larger holdings. The top five positions are all pharmaceuticals: Allergan plc, Shire plc, Valeant Pharmaceuticals, Teva Pharmaceuticals, and Mylan NV and they together account for 42.16% of the entire portfolio. The largest holding is Allergan plc at 10.33% 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:Altera Corporation (ALTR), Cameron International (CAM), and Precision Castparts (PCP): These were merger arbitrage stakes established last quarter and eliminated this quarter. Intel (INTC) agreed to acquire ALTR for $54 per share cash in June 2015 and the transaction closed in December. In August 2015, Schlumberger (SLB) announced the acquisition of Cameron International ($14.44 cash and 0.716 shares of SLB for each share held). The CAM elimination this quarter happened at prices between $60.55 and $70.68. Berkshire Hathaway (BRK.A) (BRK.B) acquired PCP in a $235 per share cash deal that closed last month.Computer Sciences Corporation (CSC): CSC was a minutely small 0.22% of the US long portfolio position. It was purchased in Q1 2015 at prices between $60.68 and $71.74 and reduced by ~84% last quarter at prices between $59.81 and $67.90.Note: CSRA Inc. (CSRA) separated from CSC in a transaction that closed in November 2015.HCA Holdings (HCA): HCA was a small 0.83% of the US long portfolio position in Q2 2014. It was increased by almost 80% in Q3 2014 at prices between $54.52 and $73.48. Q4 2014 saw an about-turn as the position was reduced by ~22% at prices between $62.94 and $74.96. The remaining 1.89% portfolio stake was eliminated this quarter at prices between $64 and $79. The stock currently trades at $67.92.MGM Resorts (MGM): MGM was a huge position established in Q2 2010 at prices between $9.48 and $15.89. Q4 2014 saw a ~70% reduction at prices between $18.01 and $23.25 and that was followed with a ~11% reduction the following quarter at prices between $19.13 and $22.85. The remaining 0.52% stake was sold this quarter at prices between $18.45 and $24.14. The stock currently trades at $18.07.WhiteWave Foods (WWAV): The very small 0.54% portfolio position was sold this quarter at prices between $36.56 and $43.82. The stock is now at $38.31.New Stakes:Akorn Inc. (AKRX) and Lam Research (LRCX): AKRX & LRCX are significantly large new stakes this quarter. The 0.64% AKRX position was purchased at prices between $22.06 and $37.34 and the stock is now at $24.95. LRCX is a 2.37% stake established at prices between $64.44 and $80.75 and the stock currently trades at $69.77.Stake Decreases:Allergan plc (AGN) previously Actavis plc: AGN was a minutely small 0.29% of the US long portfolio position in Q2 2014. The following two quarters saw a ~420% increase at prices between $202 and $271. Q2 2015 saw a further ~27% increase at prices between $283 and $313. This quarter saw an about-turn: ~23% reduction at prices between $253 and $323. The stock is currently at $275 and the stake is still Paulsons largest at 10.33% of the portfolio.Note 1: In November 2015, Pfizer Inc. announced the acquisition of Allergan plc in a deal valued at $160B. Allergan shareholders will receive 11.3 shares of a new company (the new business will be domiciled in Ireland - tax inversion deal structure) for each share held. The deal is expected to close in H2 2016.Note 2: Q1 2015 had seen a ~260% increase in AGN (then Actavis). Part of that increase was due to the acquisition of Allergan by Actavis. Paulson held 6.37M shares of Allergan for which he received ~2.35M shares. That stake was established in Q2 2014 at prices between $117 and $174. Actavis plc agreed to acquire AGN in a cash-and-stock deal valued at $219 per share and that transaction closed in March 2015.American International Group (AIG): AIG is a fairly large 4.30% of the US long portfolio stake established in Q1 2015 at prices between $48.87 and $56.11. This quarter saw a ~21% reduction at prices between $56.82 and $64.12. The stock currently trades at $51.52.Note: Carl Icahn has a huge (42.24M shares - 3.42% of the business) activist stake in the business.AngloGold Ashanti (AU): AU is a very small ~1% position. It is a long-term stake that has been in the portfolio since 2009. The stock currently trades at $10.88. Paulson controls 5.65% of the business. This quarter saw a ~9% trimming.Bank of America (BAC) 2019 WTS: This is a very small 0.57% of the US long portfolio position. It was reduced by ~16% in Q4 2014 and another ~14% in Q2 2015. Last quarter also saw a further ~11% reduction. As the position size is very small, the activity does not indicate a clear bias. There was a marginal further decrease this quarter.Cablevision Systems (CVC): CVC is now a very small 0.59% of the US long portfolio stake. It was first purchased between Q4 2012 and Q2 2013 at prices between $13.65 and $18.52. Q4 2014 saw an about-turn: ~29% reduction at prices between $17.24 and $21.32 and that was followed with a ~39% reduction the following quarter at prices between $17.72 and $20.76. In Q2 2015, the pattern reversed again: ~48% increase at prices between $17.95 and $25.86. Last quarter saw a ~37% reduction at prices between $22.59 and $33.13 and that was followed with another ~60% reduction this quarter at prices between $29.46 and $33.19. The stock currently trades at $32.44.Note: In September 2015, Altice SA agreed to acquire CVC in a $34.90 all-cash deal.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. The stake was more than doubled in Q1 2014 at prices between $15.85 and $19.46 and the following quarter saw a further 52% increase at prices between $17.20 and $19.36. The stock currently trades well below his purchase price ranges at $2.10 and the position stands at 1.28% of the US long portfolio (9.59% of the business). This quarter saw a ~5% trimming.Extended Stay America (STAY): STAY is a fairly large 4.05% of the US long portfolio position. The stake came about as a result of the firms IPO in November 2013. STAY currently trades at $12.26 compared to the IPO offering price of $20.  This quarter saw a ~11% trimming. Paulson still controls ~21% of the business.Note: 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. At the time of the 11/2013 IPO, the firms already made more than three times their investment.Grifols S A (GRFS): GRFS is a medium-sized 2.40% of the US long portfolio position. There was a ~30% reduction this quarter at prices between $15.20 and $17.79. The stock is now at $15.16. The original stake is from 2011 and Paulsons cost-basis is very low.Perrigo plc (PRGO): The 2.30% portfolio stake was purchased last quarter at prices between $153 and $194 and the stock is now at $129. This quarter saw a ~9% trimming. It was originally a merger arbitrage stake: Mylan (MYL) made a hostile takeover bid for PRGO but the tender offer lapsed in November 2015.Realogy Holdings (RLGY): RLGY is a 1.15% of the US long portfolio (3.59% of the business) position that was reduced by ~56% over the last five quarters at prices between $35 and $49. The original investment was made prior to the October 2012 IPO. The stock currently trades at $31.06.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 and was reduced by ~45% in 2011 at much higher prices. This quarter saw a ~38% reduction at prices between $100 and $114. The stock currently trades at $118. The remaining stake is at 3.50% of the portfolio.Starwood Hotels & Resorts (HOT): HOT is a 4.81% of the US long portfolio position established in Q2 2015 at prices between $80.55 and $87.53 and increased by ~30% last quarter at prices between $64.53 and $85.62. This quarter saw a ~26% reduction at prices between $66 and $80. The stock currently trades at $66.30.Note: Following CEO exit in February 2015, Starwood said they were exploring strategic alternatives to increase shareholder value. In November, Marriott International (MAR) announced a merger with HOT in a deal valued at ~$80.Time Warner Cable (TWC): TWC is a large 6.51% of the US long portfolio stake established in Q3 2013 at prices between $107 and $118. The position was almost doubled the following quarter at prices between $110 and $138. Since then, there was a ~50% further increase at a cost-basis of around $140. This quarter saw a ~28% reduction at prices between $179 and $192. The stock currently trades at $189.Note: In May 2015, Charter Communications (CHTR) agreed to buy TWC in a cash-and-stock deal valued at $195 per share ($100 cash).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. Q1 2015 saw a ~55% increase at prices between $26.87 and $33.20. The stock currently trades at $34.95. This quarter saw a ~16% reduction at prices between $34.56 and $41.38.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. It has seen some selling since. Last quarter saw a ~23% reduction at prices between $14.59 and $33.60 and that was followed with a two-thirds further reduction this quarter at prices between $8.31 and $22.43. The stake is now at 0.18% of the portfolio (1.56% of the business). It currently trades well below his purchase price ranges at $4.31. Paulson realized losses from this position.CIT Group (CIT) and MGIC Investment (MTG): These very small positions (less than ~1% of the US long portfolio each) were further reduced this quarter.Stake Increases:Mallinckrodt PLC (MNK): MNK is a 3.85% of the US long portfolio position established in Q3 2013 at prices between $42 and $47.20. It was increased by ~20% in Q2 2014 at prices between $60.28 and $82.70 and an additional one-third the following quarter at prices between $68.12 and $90. Q1 2015 saw a ~6% trimming at prices between $93.89 and $133 and the following quarter saw another ~22% decrease at prices between $113 and $130. There was an about-turn this quarter: ~31% increase at prices between $53.41 and $76.66. The stock currently trades at $64.73. The current stake is at around 7.44% of the business.Note: MNK, a July 2013 spinoff from Covidien plc (COV) started trading at around $42.Mylan Inc. (MYL): MYL is a top-five 7.37% of the US long portfolio position. The original stake was purchased in Q1 2010 at prices between $17 and $23. Q1 2013 saw a 25% reduction at prices between $27.54 and $31 and the following quarter saw another one-third reduction at prices between $28.70 and $32. Q4 2014 saw an about-turn: ~20% increase at prices between $45.27 and $58.62 and that was followed with a ~47% increase in Q2 2015 at prices between $57.94 and $76.06. The stock trades currently at $45.34. This quarter saw a ~4% further increase.Shire PLC ADR (SHPG): SHPG is a top-three stake at 8.39% of the US long portfolio. It was established in Q3 2012 at prices between $85 and $94. In Q2 2013, the position was doubled at prices between $87 and $100. In Q2 2014, the stake was again increased by ~36% at prices between $142 and $236. The following quarter saw a whopping ~170% increase at prices between $232 and $263. In Q2 2015, the pattern reversed: ~15% reduction at prices between $227 and $260. The stock currently trades at $164. This quarter saw a marginal increase.Note: In August 2015, SHPG made a hostile bid for Baxalta (BXLT), the Baxter (BAX) spin-off. Last month, the businesses agreed on a $32B merger.Teva Pharmaceuticals (TEVA): TEVA was a very small 0.55% of the US long portfolio stake established in Q2 2015 at prices between $58.91 and $67.14. It was increased to a fairly large 5.28% position last quarter at prices between $55 and $72. This quarter saw a further ~13% increase at prices between $56 and $66. The stock currently trades at $56.63 and it is now a top-five stake at 8.01%. For investors attempting to follow Paulson, Teva is a good option to consider for further research.Valeant Pharmaceuticals (VRX): VRX position was increased by almost 300% in Q1 2015 at prices between $143 and $205 and another ~340% the following quarter at prices between $197 and $242. This quarter also saw another ~50% increase at prices between $70 and $182. The stock currently trades at $84.97. It is a top three stake at 8.06% of the portfolio.Endo International plc (ENDP), LivaNova plc (LIVN) previously Cybernics (CYBX), and Post Holdings (POST): These are very small (less than ~1.5% of the portfolio each) positions that saw increases this quarter. Paulson controls 7.29% of LIVN.Note: Cyberonics and Italy-based Sorin Spa combined to form LivaNova in a merger that closed in October 2015. Paulson had a position in Cyberonics.Kept Steady:Novagold (NG): NG is a very small 0.90% of the portfolio stake. As a percentage of the business, the position is very significant at 11.5%. It is a very long-term stake and Paulsons cost-basis is higher than the current price of $4.84.Note: A regulatory Form 4 filing on 2/11/2016 shows a minor 100K share disposal at $4.72 per share.Caesars Acquisition (CACQ), Caesars Entertainment (CZR), and Outfront Media (OUT): These are very small (less than ~0.5% of the portfolio each) stakes kept steady this quarter. Although the relative position sizes are small, it is very significant that Paulson has significant ownership stakes: 9.59% of CACQ, 9.98% of CZR, and 3.1% of OUT.Although the positions are relatively minute compared to the size of the portfolio, the following 13F stakes are significant as Paulson has sizable ownership: 13.92% of NovaCopper (NCQ), 9.22% of Vanda Pharmaceuticals (VNDA), 0.56% of Radian Group (RDN), 3.86% of Oasis Petroleum (OAS), 1.04% of Houghton Mifflin Harcourt (HMHC) thru warrants, 7.92% of Synergy Pharmaceuticals (SGYP), and 7.7% of Dex Media (DXMM).The spreadsheet below highlights changes to Paulsons US stock holdings in Q4 2015:"