"Tracking David Einhorn’s Portfolio – Q4 2018 Update"
"David Einhorn's 13F stock portfolio value decreased from $2.37B to $1.38B this quarter.Greenlight decreased Brighthouse Financial, Voya Financial, and General Motors while increasing Altice USA and Tempur Sealy.2018 was Greenlight’s worst year since their 1996 inception returning negative 34%.This article is part of a series that provides an ongoing analysis of the changes made to David Einhorn’s Greenlight Capital 13F portfolio on a quarterly basis. It is based on Einhorn’s regulatory  filed on 02/14/2019. Please visit our  series for an idea on his investment philosophy and our  for the fund’s moves during Q3 2018.Greenlight Capital’s 13F portfolio value stood at $1.38B this quarter. It is down ~42% compared to $2.37B as of last quarter. Einhorn’s Q4 2018 letter reported that the fund returned negative 34% for 2018. This is compared to negative 4.4% for the S&P 500 Index. In addition to partner stakes, the fund also invests the float of Greenlight Capital RE (GLRE). Despite the availability of relatively permanent capital from that source, AUM went down from ~$7B to ~$2.5B during 2018 due to huge redemptions. Partly in response, Greenlight reopened the fund to new investors. To learn about David Einhorn and the perils of shorting, check-out his “”.Note: Greenlight maintains a hefty short book. Short positions in Core Labs and some frackers were covered last quarter. Short stakes currently held include Tesla (TSLA) and Assured Guaranty (AGO).New Stakes:Hilton Grand Vacations (HGV) and Echostar (SATS): HGV is a 2.14% of the portfolio stake established this quarter at prices between $24.50 and $33 and the stock currently trades at $31.82. The 1.59% SATS position was purchased at prices between $34 and $46 and it is now at $42.81.Dillard’s Inc. (DDS), Chemours (CC), Consol Energy (CEIX), and Shutterfly Inc. (SFLY): These four small positions (less than ~1.5% of the portfolio each) purchased this quarter have seen previous roundtrips in the portfolio. Dillard’s was a medium sized position exited in Q2 2018 at a modest profit after three years of ownership. Chemour’s had a very successful roundtrip (~4x returns) during the two year period that ended in Q1 2018. Consol Energy and Shutterfly were very small positions disposed in H1 2018.Stake Disposals:Altaba Inc. (AABA) previously Yahoo: The 4.24% AABA stake saw a huge ~120% stake increase in Q1 2016 at prices between $27 and $37. Q4 2017 saw a ~50% reduction at prices between $65.40 and $73 and that was followed with a ~20% selling next quarter at prices between $69 and $80. There was a ~17% further reduction last quarter at prices between $64 and $77.50 and the disposal this quarter was at prices between $55.50 and $67. The stock is currently at $69.11. Greenlight harvested gains.IAC/InteractiveCorp (IAC): IAC was a ~4% of the portfolio stake established in Q1 2018 at prices between $129 and $165 and increased by ~31% next quarter at prices between $131 and $165. There was another one-third increase last quarter at prices between $146 and $223. The position was eliminated this quarter at prices between $166 and $212. The stock currently trades at ~$218.Note: IAC had a previous round-trip: a long-term stake from Q1 2013 was disposed in Q2 2017 at substantial gains.Perrigo plc (PRGO): A fairly large ~4% portfolio position was built during the first three quarters of 2017 at prices between $66 and $84. The first three quarters of 2018 saw a ~90% selling at prices between $69 and $95 and the remaining stake was disposed this quarter. The stock is now at $49.55.Tractor Supply (TRCO), Sherwin Williams (SHW), and Michael Kors (KORS): These are minutely small (less than 0.20% of the portfolio each) positions purchased last quarter but disposed this quarter.Stake Increases:AerCap Holdings N.V. (AER): AER is a large (top three) ~11% position. It was established in Q2 2014 at prices between $39 and $48. Q4 2014 thru Q3 2015 saw a combined ~270% increase at prices between $36.50 and $48.50. First three quarters of 2016 had also seen another ~70% increase at prices between $25.50 and $42. The four quarters thru Q3 2018 saw the stake reduced by ~70% at prices between $49 and $57.50. The stock currently trades at $48.29. There was a marginal increase this quarter.Altice USA (ATUS) and: ATUS is a ~5% portfolio stake established last quarter at a cost-basis of $18.38 and increased by ~40% this quarter at prices between $14.50 and $19. The stock is currently just above those ranges at $21.46.Tempur Sealy International (TPX): A very small 0.34% of the portfolio stake in TPX was purchased in Q2 2017. The following quarter saw a whopping 600% increase to a fairly large position at a cost-basis of $56.11. Q4 2017 saw a ~30% selling at prices between $51 and $68 and that was followed with a ~70% reduction next quarter at prices between $44 and $64.50. This quarter saw the pattern reverse: ~70% increase at prices between $39 and $54. The stock is now at $57.54.Adient plc (ADNT): ADNT is a ~2% portfolio stake that saw a ~300% increase in Q3 2017 at prices between $64 and $86. There was a roughly one-third selling in Q1 2018 at prices between $57.50 and $84. Next quarter saw another ~50% reduction at prices between $47.50 and $66. There was an about turn last quarter: position almost doubled at prices between $38 and $51 and that was followed with a ~75% increase this quarter at prices between $15 and $38. The stock is now at $20.05.Stake Decreases:General Motors (GM): GM is Greenlight’s second-largest position at ~29% of the portfolio. The position was established during the first three quarters of 2015 at prices between $28.50 and $39. The three quarters thru Q2 2016 had also seen a combined ~22% increase at prices between $27 and $34. The position was increased by around four-times during Q4 2016 & Q1 2017 at prices between $31 and $38.50. The next three quarters saw a ~65% reduction at prices between $32.50 and $46.50. Last year saw another ~55% selling at prices between $30.50 and $45. GM currently goes for $39.53.Note 1: In March 2017, Greenlight proposed GM shares be split into two classes (one with dividend & the other without) but management rejected the plan. In response, Greenlight nominated three members to the board but GM shareholders rejected the proposal and the nominations in June.Note 2: Greenlight had a previous successful roundtrip with GM: A ~10% stake was disposed in Q1 2014 at an average exit price of $35.76 compared to an average entry price of $23.87.Brighthouse Financial (BHF): BHF is a large (top five) stake at 7.26% of the portfolio. The position was established in Q3 2017 and increased by ~60% in the following quarter at an overall cost-basis of $57.92. The stock is currently well below that at $42.76. There was a ~70% selling this quarter at prices between $29 and $46.50. Greenlight realized losses.Note: BHF is a spinoff of MetLife’s (MET) U.S. Retail business (annuities and life insurance) that started trading in July 2017.Voya Financial (VOYA) previously ING US: The 3% VOYA position was established in Q2 2013 at a cost-basis of $20.29. Last year saw a ~60% combined increase at prices between $24 and $41. The stock currently trades at $49.67. Last four quarters have seen a ~80% selling at prices between $37 and $55. Greenlight is harvesting gains.CNX Resources (CNX) previously Consol Energy: CNX is a ~3% stake purchased in Q3 2014 and built up over the next several quarters. The three quarters thru Q4 2016 had seen a ~50% combined reduction at prices between $8 and $19. The pattern reversed in Q1 2017: ~50% increase at prices between $12 and $16.50. The stock currently trades at $10.32. Last four quarters have seen a ~80% selling at prices between $11 and $18.Note: The prices quoted above are adjusted for the coal spinoff Consol Energy (CEIX) in November 2017.Kept Steady:Green Brick Partners (GRBK): The large (top three) 12.64% of the 13F portfolio GRBK stake was acquired as a result of BioFuel Energy’s JGBL Builder Finance acquisition and rename transaction. The deal closed (October 2014) with Greenlight owning 49% of the business. David Einhorn was appointed Chairman of the Board following the transaction.Ensco plc (ESV): ESV is a fairly large ~5% portfolio position. It was established in Q4 2017 at a cost-basis of $5.72. There was a stake doubling in Q1 2018 at prices between $4.34 and $7.43 and the stock is now at $4.77.Consol Coal Resources LP (CCR) and Exela Technologies (XELA): These two positions were kept steady this quarter. Greenlight controls ~35% of CCR. In July 2017, Quinpario Acquisition (a SPAC that had an IPO in January 2015) merged with HOV LLC and Novitex Holdings (financial technology services provider) to form Exela Technologies. Greenlight has a 5.5% ownership stake in Exela.Medicines Company (MDCO) and Seadrill Ltd. (SDRL): These two very small (less than ~1.3% of the portfolio each) stakes were kept steady this quarter.The spreadsheet below highlights changes to Greenlight’s 13F stock holdings in Q4 2018:: Performance – negative 25.7% YTD compared to 10.6% for the S&P 500 index. AAPL – Last shares sold at $228 - $1B profit since first purchased at $36 in 2010 – 26% overall IRR. GM long and Tesla short – comparison of GM Cruise which has Robo-taxi plans and decent valuation with Honda partnership – Tesla bull valuation was based on RoboTaxis accounting for much of Tesla’s valuation in 2023. Parallels to Lehman (going private, threatening short-sellers, etc.). Speculates Musk secretly want out of Tesla as he cannot make at $35K that is profitable, although he has taken deposits. NEW POSITIONS: Altice USA (ATUS) @ $18.38 cost-basis. Medium-sized position in BT Group (UK listed) at 2.19 pounds. EXITS – MLM 11-year short covered at a mid-single-digit IRR loss, MU – 66% gain over a year – DRAM pricing weakness sensed. MYL – multi-year position exited at small loss – lower price points for new products and generic industry overall decline. TDG Short – exited at medium loss – suspects price gouging but us-military is not doing anything. TWTR – exited with a ~78% gain over six months. Largest Disclosed Longs - AerCap, Brighthouse Financial, General Motors, Green Brick Partners and gold. Long/Short Ratio: The Partnerships had an average exposure of 106% long and 74% short compared to 96% long and 75% short last quarter.Regulatory Filings thru 11/18/2018: None."