"Tracking David Einhorn’s Portfolio – Q3 2015 Update"
"David Einhorn's US long portfolio decreased from $7.97B to $6.03B this quarter.Greenlight's long/short ratio is at 91% long and 66% short compared to 103% long and 86% short last quarter.Greenlight substantially increased AerCap, Apple, and Michael Kors while dropping Citizens Financial Group.This article is part of a series that provides an ongoing analysis of the changes made to David Einhorn’s Greenlight Capital US long stock portfolio on a quarterly basis. It is based on Einhorn’s regulatory  filed on 11/16/2015. Please visit our  series for an idea on his investment philosophy and our  highlighting the fund’s moves during Q2 2015.Greenlight Capital’s US long portfolio stood at $6.03B this quarter. It is down ~24% compared to $7.97B as of last quarter. The long/short ratio shifted further to the long side this quarter: 91% long and 66% short compared to 103% long and 86% short as of Q2 2015 - net exposure at 25% compared to 17% last quarter. The top five holdings represent 44.72% of the US long portfolio. The number of 13F stakes decreased from 41 to 39.Einhorn’s Q3 2015 letter reported that the fund lost 14.3% in the quarter and 17.1% YTD 2015. Big losers among the longs include Apple, General Motors, Aercap, and Chicago Bridge & Iron. A short stake on athenahealth (ATHN) also showed losses. Winners in the quarter include short positions in Pioneer Natural Resources (PXD), Keurig Green Mountain (GMCR), and Mallinckrodt (MNK). The letter also revealed that the following short positions were covered in the quarter: a multi-year position in Robert Half International (RHI) for a loss, Intel (INTC) for a small gain, a decade-long position in St. Joe (JOE) for handsome gains, and United States Steel (X) for decent gains.To learn about David Einhorn and the perils of shorting, check-out his “”.New Stakes:CNX Coal Resources LP (CNXC), Garmin Ltd. (GRMN), Liberty Global LiLAC (LILA) (LILAK), Terraform Global (GLBL), and Vivint Solar (VSLR): These are very small (less than ~1% of the portfolio each) stakes established this quarter. All except Garmin were the result of recent spinoff transactions.Stake Disposals:Citizens Financial Group (CFG): CFG was a 4.3% position established at a cost-basis of $22.36 last year. This quarter, the entire stake was eliminated at $26.28. The stock currently trades at $26.12. Greenlight exited as the upside they anticipated to the company’s estimates did not materialize.Note: It is a carve-out from Royal Bank of Scotland (RBS) that debut on 9/23/2014.Halyard Health (HYH): HYH was a minutely small 0.06% of the US long portfolio position. It was established in Q4 2014 at prices between $35.82 and $48.30 and reduced by ~70% the following quarter at prices between $43.07 and $49.62. Last quarter, the remaining stake was almost eliminated at prices between $40 and $51. The stock currently trades at $31.16.Note: HYH, a surgical infection prevention products business is a spin-off from Kimberly Clark (KMB). It started trading in November 2014.Lam Research (LRCX): LRCX is a 1.67% of the US long portfolio position first purchased in Q1 2014 and more than doubled the following quarter. The selling started in Q1 2015 when there was a one-third reduction at prices between $70.24 and $84.48 and last quarter saw a marginal further reduction. Overall, Greenlight’s cost-basis was $54.07 and the exit was at $75.30. Greenlight sold as they expect the cycle to peak shortly thereby putting 2016 estimates at risk.Macys Inc. (M): M was a small 0.86% of the US long portfolio stake established in Q1 2015 at prices between $62.10 and $67.81. The position was sold down by ~39% last quarter at prices between $63 and $71 and eliminated this quarter at prices between $50.29 and $72.80. The stock currently trades at $38.54.NorthStar Asset Management (NSAM): The 0.71% NSAM position was established as a result of the spin-off of NSAM from NorthStar Realty Finance that was completed in July 2014.  It currently trades at $13.61 compared to an IPO price of $18.80. The original stake was reduced by ~30% in Q1 2015 at prices between $20.56 and $24.75. The exit this quarter happened at prices between $13.60 and $19.37.Spirit Aerosystems (SPR): SPR was a 1.48% position that had seen consistent buying since the stake establishment in Q1 2013. The position was increased by just over 40% in Q4 2013 at prices between $21.50 and $26 and another 20% in Q1 2014 at prices between $26.51 and $35.89. In Q3 2014, the pattern reversed as the stake was reduced by 29% at prices between $32.57 and $39.73. The elimination this quarter happened at prices between $47.62 and $57.16. The stock currently trades at $53.37. Einhorn has disclosed that the overall cost-basis on SPR was $20.28 & average exit price was $50.55.Hertz Global (HTZ): HTZ was a very small 1.23% stake established last quarter at prices between $18.12 and $22.37 and sold this quarter at prices between $15.79 and $21.17. The stock currently trades at $16.75.Note: Carl Icahn has a large activist stake in HTZ.Stake Increases:AerCap Holdings N.V. (AER): AER is a fairly large (top five) 5.29% position established in Q2 2014 at prices between $38.91 and $48.14. It was increased by ~68% in Q4 2014 at prices between $36.68 and $45.22 and another ~50% the following quarter at prices between $37.84 and $45.94. This quarter also saw another ~50% increase at prices between $37.71 and $48.49. The stock currently trades at $42.83.Apple Inc. (AAPL): AAPL is Einhorn’s largest position by far at 21.47% of the US long portfolio. The stake was first purchased in the low-40s price-range in 2010. It was reduced by 25% in Q3 2012 at prices between $82 and $100 but upped by 45% in Q4 2012 at prices between $72 and $96. In Q1 2013, the position was again increased by around 50% at prices between $60 and $78. Last six quarters had seen a combined ~55% reduction at prices between $72 and $133. This quarter, the pattern reversed: ~59% increase at prices between $103 and $132. The stock currently trades at $119.Chicago Bridge & Iron (CBI): CBI is a 4.92% of the US long portfolio position established in Q4 2014 at prices between $37.78 and $57.85 and increased by ~130% the following quarter at prices between $34.51 and $49.48. This quarter saw a ~11% further increase at prices between $37.24 and $53.26. The stock currently trades at $42.75.Consol Energy (CNX): CNX is a fairly large 4.81% stake (top-five) purchased in Q3 2014 at prices between $36.53 and $46.07.  In Q4 2014, the position was increased by over 170% at prices between $32.13 and $41.61 and the following quarter saw a further ~55% increase at prices between $26.56 and $34.34. Last quarter had also seen a ~11% increase at prices between $21.74 and $33.34 and that was followed by another ~30% increase this quarter at prices between $9.41 and $21.79. The stock currently trades at $7.83.Note 1: CNX completed an IPO for its coal business as CNX Coal Resources (CNXC) in July.Note 2: A regulatory Form 4 filing on 11/9/2015 shows the position was almost eliminated through the purchase of total return swaps (Jan 2017 expiry).General Motors (GM): GM is Greenlight’s second-largest position at 8.11% of the portfolio. The original stake was increased by ~55% last quarter at prices between $33.23 and $37.50 and another ~11% this quarter at prices between $27.28 and $33.23. The stock currently trades at $36.13. For investors attempting to follow Einhorn, GM is a good option to consider for further research.Note: GM was Greenlight’s third-largest position at 9.55% of the US long portfolio in Q4 2013. That stake was disposed of the following quarter at an average exit price of $35.76 compared to an average entry price of $23.87. Greenlight expected 2014 to be a break-out earnings year but the guidance disappointed and that resulted in the exit decision. The current thesis boils down to the expectation that GM will likely beat the 2015 earnings projection of $4.63 per share.Michael Kors Holdings (KORS): KORS is a fairly large (top five) 4.93% of the US long portfolio position established last quarter at prices between $42 and $66 and almost doubled this quarter at prices between $38.06 and $45.37. The stock currently trades at $40.88. For investors attempting to follow Einhorn, KORS is a good option to consider for further research.Time Warner Inc. (TWX): TWX is a fairly large 4.35% of the US long portfolio stake established in Q4 2014 at a cost-basis of $72.72. The stock currently trades at $70.98. This quarter saw a marginal increase.UIL Holdings Corporation (UIL): UIL is a medium-sized 2.87% of the portfolio stake. It was established in Q1 2015 at prices between $42 and $52 and increased by ~92% last quarter at prices between $45.82 and $51.42. The stock currently trades at $48.10. Greenlight’s overall cost-basis is at $49.57. This quarter saw a very minor increase. For investors attempting to follow Greenlight, UIL is a good option to consider for further research.Note: UIL is combining with Iberdrola USA. UIL shareholders are to get $10.50 per share cash and one share of the newly listed entity for each share held.Dillard’s (DDS), Owens Illinois (OI), Santander Consumer USA Holdings (SC), Twenty First Century Fox (FOXA), and Vodafone Group (VOD): These are small (less than ~2% of the portfolio each) stakes that were increased this quarter.Note 1: Alex Roepers has a huge activist position in Owens Illinois.Note 2: Twenty First Century Fox is a popular stake among super-investors: Donald Yacktman, Wallace Weitz, and Leon Cooperman among others have substantial positions.Stake Decreases:Aecom Technology (ACM): ACM is a 2.95% stake first purchased in Q3 2014 at prices between $31.66 and $38.13 and more than doubled the following quarter at prices between $28.12 and $33.91. Last two quarters have seen marginal decreases. The stock currently trades at $31.22.Applied Materials (AMAT): AMAT is a small 1.22% stake purchased last quarter at a cost-basis of $20.31. This quarter saw a ~38% reduction at prices between $14.37 and $19.61. The stock currently trades at $18.20.IAC Interactive (IACI): IACI was a minutely small 0.30% of the US long portfolio position established in Q1 2013. In Q2 2013, the stake was substantially increased at prices between $43.50 and $51.50. The position has wavered since. Last quarter saw a ~37% reduction at prices between $67 and $81. The stock currently trades at $62.26 and the stake is at 1.62% of the US long portfolio. This quarter saw a ~6% trimming.Kapstone Paper & Packaging (KS): KS is a minutely small 0.08% of the US long portfolio stake. The original position was increased by ~60% in Q1 2015 at prices between $28.82 and $35.43. Last quarter saw an about-turn: one-third reduction at prices between $23 and $33. This quarter saw a further ~70% reduction at prices between $16.34 and $25. The stock currently trades at $23.38.Micron Technology (MU): MU was Einhorn’s third-largest 13F position at 8.97% of the US long portfolio as of last quarter. It was reduced by around two-thirds this quarter at prices between $14.06 and $20.12. The original stake was purchased in Q4 2013 at an average cost-basis of $16.49. Q1 2014 saw a ~8% trimming at prices between $20.67 and $25.49 and the following quarter saw an additional ~8% trimming at prices between $21 and $32.50. In Q3 2014, almost 25% of the remaining position was sold at prices between $29.68 and $34.64. Last quarter saw a ~13% increase at prices between $18.73 and $29.52. The stock currently trades at $15.87.Sunedison Inc. (SUNE): The very small 0.23% of the US long portfolio position in SUNE established in Q4 2013 was increased to a fairly large 3.34% position in Q1 2014 at an average entry price of $15.55. In Q2 2014, the stake was increased by another 79% at prices between $16.74 and $22.87. Q1 2015 saw a further ~18% increase at prices between $14.30 and $22.86. This quarter saw a ~25% reduction at prices between $6.66 and $31.84. The stock currently trades at $2.87. Greenlight controls ~5.9% of the business.Note: SUNE completed the IPO of its yield-co TerraForm Power (TERP) in July 2014 and TerraForm Global (GLBL) in August 2015.Sunedison Semiconductor (SEMI): SEMI is a small 0.33% of the US long portfolio stake established in Q1 2015 at prices between $15.19 and $27.14. It was increased by 37% last quarter at prices between $17.27 and $26.46. This quarter saw a ~49% reduction at prices between $10 and $18.14. The stock currently trades at $8.68. Einhorn controls ~4.5% of the business.Note: Seth Klarman (Baupost Group) also has a large ~20% stake in the business.Voya Financial (VOYA) previously ING US: The 2.35% VOYA position was established in Q2 2013 at a cost-basis of $20.29. Q4 2014 saw a 37% increase at prices between $35.23 and $43.07. This quarter saw a ~38% reduction at prices between $38.25 and $47.87. The stock has more than doubled from his original purchase and currently trades at $41.60.Fifth Street Asset Management (FSAM): FSAM is a minutely small 0.07% of the portfolio stake that had a marginal reduction this quarter.Kept Steady:Bank of New York Mellon (BK) and Ingram Micro (IM): These two positions were established in Q1 2015 and increased last quarter. BK saw a more than 10x increase at prices between $40 and $44. It is now at 2.60% of the portfolio. The stock currently trades at $43.83. The IM position saw a ~9% increase last quarter but is still very small at 0.55%.Green Brick Partners (GRBK): The 4.33% of the US long portfolio GRBK stake was acquired as a result of BioFuel Energy’s JGBL Builder Finance acquisition and rename transaction. The deal closed with Greenlight owning 49% of the business. David Einhorn was appointed Chairman of the Board following the transaction.Liberty Global Class A & Class C (LBTYA) (LBTYK): Liberty Global position accounts for 2.94% of the US long portfolio. Einhorn had a position in Virgin Media (VMED) from Q2 2012 onwards and the Liberty Global position was established as a result of the acquisition of VMED by Liberty Global.Market Vectors Gold Miner ETF (GDX): GDX stake is currently at 1.94%. It is a very long-term position and has wavered over the years. Last significant activity was a ~35% increase in Q4 2014 at prices between $16.59 and $21.94. The stock currently trades at $13.97.Note: Einhorn also has a large holding (top-five) in physical gold.Oil States International (OIS): OIS was a fairly large stake established in Q1 2013 at an average purchase price of $77.16. In Q4 2014, the position was almost eliminated at prices between $42.42 and $61.90. The stock currently trades at $29.90.Note: The performance implied by the quoted prices above understates the actual performance due to the effect of the spin-off of CVEO from OIS. The spin-off terms called for OIS shareholders to receive two shares of CVEO for every share of OIS held.ON Semiconductor (ON): ON is a 2.70% position established in Q3 2014 at prices between $8.34 and $9.91 and increased by ~18% the following quarter at prices between $6.94 and $10.22. Last two quarters had seen minor reductions. The stock currently trades at $10.10.Take-Two Interactive (TTWO): TTWO was first purchased in Q4 2013 at prices between $18.81 and $22.38. The position was decreased by ~11% last quarter at prices between $23.70 and $28.62 and the stock currently trades at $34.63. The stake is at 1.98% of the US long portfolio and Einhorn controls ~4.9% of the business.Tri Pointe Homes (TPH): TPH is a very small ~1% of the US long portfolio stake established in Q4 2014 at prices between $12.73 and $15.34 and increased by ~9% the following quarter at prices between $13.59 and $16.03. The stock currently trades at $13.56.Note: TPH, a homebuilder with significant exposure to the California market is a spin-off from Weyerhaeuser Company (WY). It started trading in February 2013. The stock is still below the IPO price of $19.Scientific Games Corp. (SGMS) and Yahoo Inc. (YHOO): These are very small (less than ~1% of the US long portfolio each) stakes that were kept steady this quarter.Per Greenlight’s Q3 2015 letter, the top disclosed long positions in the partnership are Apple, Consol Energy, General Motors, gold, and Resona Holdings.  In addition to partner stakes, the fund also invests the float of Greenlight Capital RE (GLRE).The spreadsheet below highlights changes to Greenlight’s US stock holdings in Q3 2015:: H1 2015 return is (3.3%) net of fees. CNU & MU were the big losers and SUNE was a winner. NEW LONGS: AMAT @ 20.31, BK @ 40.61. EXITS: Altice (good profit), Conn’s (small profit), EMC (small profit), ISRG Short (small gain), MRVL (15% compounded over several years), NOK (healthy profit), Playtech (23% compounded), Vale Short (good profit - down ~50% since entry). Largest disclosed longs: AAPL, CNX, GM, gold, MU, and SUNE. Long/Short Ratio: 103% long and 86% short.5/15/2015 13G: CVEO - 3.11M shares, 2.9% of business.: Q1 2015 return is (1.5%) net of fees. H1 2015 at (3.3%). S&P 500 H1 2015 return was +1.2%.  NEW LONGS: AER @ $41.02, CBI @ $42.93, GM @ $34.62. EXITS:AET with 44% IRR, DOX with 24% IRR, Also closed the following shorts at a loss as they were acquired: SWY @ (31%) IRR, FSL @ (71%) IRR, and LO @ (25%) IRR. LO short rolled to RAI as well. The largest disclosed long positions in the Partnerships were Apple, Consol Energy, gold, ISS A/S, Micron Technology and SunEdison. The Partnershipshad an average exposure of 102% long and 88% short - Net exposure down from 30% to 14% in the quarter - they believe there is a good chance that earnings will shrink this year."