"Tracking David Abrams’ Abrams Capital Management Portfolio – Q3 2020 Update"
"David Abrams’ 13F portfolio value increased this quarter from $3.09B to $3.16B. The number of positions decreased from 20 to 19.Abrams Capital Management increased Energy Transfer LP during the quarter.The top three positions are Lithia Motors, Facebook, and TransDigm Group and they add up to one third of the portfolio.This article is part of a series that provides an ongoing analysis of the changes made to David Abrams’ 13F portfolio on a quarterly basis. It is based on Abrams’ regulatory  filed on 11/13/2020. Please visit our  article for an idea on his investment philosophy and our  for the fund's moves during Q2 2020.This quarter, Abrams’ 13F portfolio value increased from $3.09B to $3.16B. The number of holdings decreased from 20 to 19. The top three stakes are at ~34% of the 13F portfolio while the top five holdings are at ~50%. The largest position is Lithia Motors and it accounts for ~16% of the 13F portfolio.Stake Disposals:Pacific Drilling SA (PACD): The very small 0.13% PACD stake got established in Q4 2018 as the company emerged from Chapter 11 bankruptcy that November - Abrams had ~$200M in Pacific Drilling debt when the company filed for bankruptcy in November 2017. Last quarter saw the position almost eliminated at prices between $0.35 and $1. The remainder stake was disposed this quarter.Note 1: Pacific Drilling SA filed for Chapter 11 bankruptcy at the end of October.Note 2: Abrams Capital had a ~10% ownership stake in Pacific Drilling as of Q1 2020.New Stakes:None.Stake Decreases:Franklin Resources (BEN): BEN is a large 5.28% of the 13F portfolio stake established in Q4 2015 at prices between $35 and $42 and increased by ~50% the following quarter at prices between $31.50 and $39. There was another ~25% stake increase in Q3 2018 at prices between $30 and $34.50. The stock currently trades well below the low end of those ranges at $22.37.  This quarter saw a ~15% trimming at prices between ~$19 and ~$23.Camping World Holdings (CWH): CWH is a ~5% position purchased in Q3 2018 at prices between $19 and $27 and increased by two-thirds next quarter at prices between $11.25 and $22.50. Q2 2019 saw a ~30% stake increase at prices between $11 and $13 per share. Q4 2019 saw a ~12% stake increase at ~$7.90 per share while this quarter there was similar selling at ~$37.50. The stock is now at $31.20. Abrams is starting to realize gains. They still control ~13% of the business.Bristol Myers Squibb Rights (BMY.RT): It is a ~1% position that came about in Q1 2020 as a result of the acquisition of Celgene. Terms called for CELG shareholders to receive $50 cash, 1 share of Bristol Myers Squibb (BMY), and a tradeable Contingent Value Right that could pay out $9 cash in 2021 based on achieving milestones. Abrams held 6.75M shares of CELG for which they received the same number of BMY shares and the Rights. In Q4 2019, the BMY position was sold but the Rights were increased substantially. This quarter saw a one-third reduction in the Rights. It currently trades at ~$1.19.Sculptor Capital (SCU) previously Och-Ziff Capital Management: SCU is a 0.59% portfolio stake established in Q2 2016 at prices between $33 and $43.50 and increased by ~11% in the following quarter at around the same price range. There was another similar increase in Q4 2016 at a cost-basis of ~$32. Q1 2017 also saw a ~17% increase at prices between $22 and $36.30. There was a ~23% selling this quarter at prices between ~$10.50 and ~$14.50. The stock is now at $14.80.Note 1: Regulatory filings from last week show them owning 1.12M shares (4.96% of business). This is compared to 1.59M shares in the 13F report.Note 2: The prices quoted above are adjusted for the 1 for 10 reverse stock-split in January. Abrams has a ~10% stake in the business.Stake Increases:Energy Transfer LP (ET): The 3.79% ET stake was established in Q1 2020 at prices between $4.55 and $13.75 and it is now at $6.71. There was a ~64% stake increase this quarter at prices between $5.40 and $7.15.Kept Steady:Lithia Motors (LAD): LAD is currently the largest position at ~16% of the portfolio. It was established in Q2 2018 at prices between $95 and $105 and almost doubled next quarter at prices between $81 and $99. Q4 2018 also saw a ~15% stake increase. The stock has tripled over the two-year holding period and is now at ~$309.Note: Their ownership stake in Lithia Motors is at ~10%.Facebook (FB): FB is a large (top three) ~10% portfolio position purchased in Q4 2018 at prices between $124 and $163 and the stock currently trades at ~$277. Q1 2020 saw a ~18% stake increase at prices between $146 and $223.TransDigm Group (TDG): The large (top three) ~8% TDG position was purchased in Q1 2020 at prices between $246 and $658 and the stock currently trades at ~$615.PG&E Corp (PCG): The PCG stake is now a top five 7.42% of the portfolio position. It was purchased at ~$7 per share and it currently goes for $12.82. PG&E shares price dropped sharply in mid-January as they announced plans to file for bankruptcy. Abrams along with two other hedge funds stepped in and bought 45M shares near the lows.Willis Towers Watson plc (WLTW): WLTW is a large 7.22% position purchased in Q1 2017 at prices between $117 and $133. The stock is now well above that range at ~$209. There was a ~6% trimming in Q4 2018 and since then the activity has been minor.Note: Aon plc (AON) is acquiring Willis Towers Watson plc in an all-stock deal (1.08 shares of Aon for each share held) announced in March.Teva Pharmaceutical (TEVA): TEVA is a large 6.85% of the portfolio stake established in Q3 2017 at prices between $15.50 and $33.50. Q3 2019 saw a one-third stake increase at prices between $6 and $9.60. The stock currently trades at $9.86.Alphabet Inc. (GOOG): GOOG is a 6.78% position purchased in Q2 2018 at prices between $1005 and $1175 and the stock is now well above that range at ~$1769. There was a ~20% stake increase in Q1 2020 at prices between $1057 and $1527.Asbury Automotive (ABG): ABG is a 6.52% position established in Q3 2017 at prices between $50 and $62 and increased by ~45% in Q3 2018 at prices between $67 and $77.50. Next quarter saw another 20% stake increase at prices between $59 and $72. The stock currently trades at ~$127. Q1 2020 also saw a ~11% stake increase at an average cost in the high 40s.Note: Their ownership stake in the business is ~11%.AMERCO (UHAL): UHAL is a 6.32% position purchased in Q4 2016 at prices between $314 and $374 and increased by ~160% the following quarter at prices between $367 and $391. There was a ~45% increase in Q2 2017 at prices between $341 and $393 and that was followed with a similar increase in H1 2018 at prices between $323 and $384. The stock is now at ~$415.Kinder Morgan (KMI): KMI is a 4.86% of the portfolio position purchased in Q1 2018 at prices between $14.75 and $19.75. Q1 2020 saw a ~15% stake increase at prices between $10 and $22.25 and that was followed with a ~27% increase last quarter at prices between $12.73 and $18. The stock currently trades at ~$15. For investors attempting to follow, KMI is a good option to consider for further research.O-I Glass (OI) previously Owens-Illinois: OI is a 2.32% of the portfolio stake established in Q4 2019 at prices between $8.50 and $12 and increased by ~42% next quarter at prices between $4.64 and $15. The stock currently trades at $12.96.TransMedics Group (TMDX): TMDX is a 1.52% of the 13F portfolio stake that came about as a result of its IPO last May. Abrams was an early investor who led funding rounds going back to 2012. The stock started trading at ~$25 and currently goes for $14.51. Abrams has a ~17% ownership stake in the business.Akebia Therapeutics (AKBA): AKBA was a 2.48% portfolio stake as of Q3 2018. Akebia merged with Keryx Pharmaceuticals in a transaction that closed in December 2018. Keryx shareholders received 0.37433 common shares of AKBA for each share held. Abrams had ~9.1M shares of Keryx for which he received 3.4M shares. Abrams also increased the overall position by ~20% during Q4 2018 at prices between $5.40 and $9.15. AKBA currently trades at $3.08 and the stake is at 0.45% of the portfolio.Note: Their ownership stake in Akebia is at ~5%.Clear Channel Outdoor Holdings (CCO): CCO is a very small 0.11% of the 13F portfolio stake. It is a very long-term position that has been in the portfolio since 2009. The stake has been kept almost steady since. In March 2012, CCO paid a special-dividend of $6.08 per share and that recouped almost the entire outlay on this investment. The stock currently trades at $1.55.The spreadsheet below highlights changes to Abrams’ 13F stock holdings in Q3 2020:Regulatory filings thru 8/14/2020: Form 4 – 8/5 – CWH – 500K disposed at 40.18 – 5.1M shares remain. Form 4 – 7/20 – 500K shares disposed at 35.13 – 5.6M shares remain."