"Tracking David Einhorn’s Portfolio – Q4 2012 Update"
"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 02/14/2013. Please visit our  series for an idea on how his holdings have progressed over the years and our  highlighting the fund’s moves during Q3 2012.Greenlight Capital’s US long portfolio stood at $6.38B this quarter. It is about 6% higher than the ~$6B as of last quarter. The number of holdings dropped from 40 to 37. The fund added three new holdings but sold out of six stocks in the quarter. The top five holdings now represent around 40% of the US long portfolio, about the same as last quarter. Two of the top-five changed during the quarter: Computer Sciences Corp (CSC) and Marvell Technology (MRVL) replaced Market Vectors Gold Miner ETF (GDX) and Seagate Technology (STX).New Stakes:Google Inc. (GOOG), Vodaphone Group PLC (VOD), and Western Digital (WDC): These are very small (less than 1% of the US long portfolio) stakes established this quarter: GOOG is a 0.70% stake established at prices between $647 and $768. The stock currently trades outside that range at over $790. VOD is a 0.63% stake established at prices between $25 and $29. The stock currently trades near the low end of that range at around $26. WDC is a 0.40% stake established at prices between $33 and $42. The stock currently trades well outside that range at $48.59. The position sizes are too small to indicate a clear bias. Einhorn established a position in Seagate Technology (STX), a WDC competitor in Q2 2011 at an average purchase price of $16.07 and that position has more than doubled. The new WDC position is already showing a nice return.Stake Disposals:Huntington Ingalls Industries Inc. (HII): HII was a 1.5% stake that was reduced by around 20% last quarter at prices between $38.17 and $42.27. The original stake was purchased in Q2 2011 at prices between $34.50 and $40.98. It was disposed of this quarter at prices between $39.87 and $45. The stock currently trades at $45.35. The stake elimination indicates a bearish bias.Humana Inc. (HUM) and Wellpoint Inc. (WLP): HUM and WLP were similar sized ~0.9% positions first purchased in Q2 2012. The HUM stake was purchased at prices between $74 and $92 and the WLP stake at prices between $64 and $74. Both positions were reduced last quarter and eliminated this quarter. HUM stake elimination happened at prices between $61 and $76 while WLP was sold at prices between $53 and $62. The about-turns indicate a clear bearish bias toward both these companies. Einhorn simultaneously increased his stake in two other businesses in the same space (Aetna and Cigna), thus confirming the bearish bias toward HUM and WLP.Liberty Media Capital (LMCA): LMCA was a 1.69% position purchased in Q4 2011 at prices between $61 and $80. It was disposed of at much higher prices this quarter and the stock currently trades at around $110. The stake elimination indicates a bearish bias.Genworth Financial (GNW) & Knight Capital Group (KCG) NOTES: These two very small stakes were eliminated this quarter. As the positions were minute, they do not indicate a clear bias.Stake Increases:Aetna Inc. (AET) & Cigna Corporation (CI): AET and CI positions were increased substantially this quarter. AET stake was increased by almost 50% at prices between $39.60 and $47 while the CI stake was increased by around 15% at prices between $47 and $54.50. AET is a 4.72% position while CI is a 6.86% position. AET stake was increased by ~40% last quarter as well at prices between $35.30 and $40.29. The original stake was purchased in Q2 2012 at prices between $38.77 and $50.23. The stock currently trades at $49.20. CI stake was increased by ~10% last quarter as well at prices between $39.66 and $47.80. The original stake was purchased in Q2 2012 at prices between $42.58 and $49.43. The stock currently trades at $61.08. The pattern of trades indicates a clear bullish bias toward AET and CI. For investors attempting to follow Einhorn, these are good candidates for further research.Apple Inc. (AAPL) and CALLs: AAPL is Einhorn’s largest position accounting for 13.19% of the US long portfolio. It is one of Einhorn’s biggest winners in recent times with the first purchases made in the high-200s price-range in 2010. The position was reduced by 25% last quarter at prices between $574.88 and $702.10 but upped by 45% this quarter at prices between $509 and $671. The stock currently trades at around $460. The aggressive purchases against falling prices indicate a clear bullish bias.CBS Corporation (CBS): CBS is a 3.21% of the US long portfolio stake first purchased in Q3 2011 at an average purchase price of $20.79. The stake was upped by 25% this quarter at prices between $32 and $38 and the stock currently trades well outside that range at around $45. The substantial stake increase indicates a bullish bias.Marvell Technology Group (MRVL): MRVL is a large 5.89% of the US long portfolio stake that was increased by almost 60% this quarter at prices between $7 and $9.40. The original MRVL position was acquired at around $13 in Q3 2011. The position size was increased by over 25% last quarter at prices between $9.16 and $12.28. The stock currently trades at around $9.35. For investors attempting to follow Einhorn, MRVL is a good option to consider.Computer Sciences Corporation (CSC) and DST SYS INC (DST): These are medium-sized positions (1-5%) increased incrementally this quarter. Einhorn purchased the initial stake in CSC in Q1 2012 at prices between $23.37 and $33.26. The stake was almost doubled last quarter at prices between $22.50 and $34.68 and by an additional ~12% this quarter at prices between $30 and $41. The stock currently trades at around $48. The DST stake was first purchased in Q4 2011 at prices between $41.23 and $50.77. It was marginally increased last quarter and by ~10% this quarter at prices between $50.11 and $63. The stock currently trades at around $68.Microsoft Corporation (MSFT): MSFT is a 4.53% position that was increased by over 40% this quarter at prices between $26 and $30. The stake was reduced by roughly the same amount last quarter at prices between $26.76 and $32.85. The stock currently trades at $28. The quick about-turn indicates a bullish bias. For investors attempting to follow Einhorn, MSFT is a very good option to consider.NCR Corporation (NCR) and Aspen Insurance Holdings (AHL): These are medium sized long-term positions that were substantially increased this quarter after keeping them steady in the last quarter. The NCR position was increased by 24% this quarter at prices between $21 and $25.50. The stock currently trades outside that range at around $29. The AHL position was increased by 22% this quarter at prices between $29.75 and $33.60. The stock currently trades at around $36. Einhorn is still very bullish on these two positions. For investors attempting to follow Einhorn, they are good options, although better entry points should be sought.Babcock & Wilcox (BWC): BWC is 1.67% of the US long portfolio stake that was established last quarter and increased by a whopping 372% this quarter at prices between $23 and $27. The stock currently trades just inside that range at around $26.70. The major stake increase indicates a bullish bias. For investors attempting to follow Einhorn, BWC is a good option to consider.Aecom Technology (ACM): ACM is a very small 0.44% of the portfolio stake initiated last quarter and increased by around 50% this quarter. The position size is still too small to indicate a clear bias.Stake Decreases:Coventry Health Care Inc. (CVH): CVH is 0.58% position that was reduced by over 70% this quarter. The position was purchased in Q2 2012. The quick turnaround and simultaneous build-up of positions (AET and CI) in other businesses in the same sector indicates a clear bearish bias.Delphi Automotive PLC (DLPH): DLPH is a large 4.79% of the US long portfolio position that was reduced marginally this quarter. The stake was established in 2011 prior to the IPO. The stock currently trades at around $40. The minor activity does not indicate a clear bias.General Motors Company (GM): GM is Einhorn’s second largest position at 9.56% of the US long portfolio. The stake was increased by 20% last quarter at prices between $18.80 and $24.80. The position was marginally reduced this quarter. The original stake was purchased in Q1 2011 at prices between $30.74 and $38.98 with the bulk of the current stake acquired in Q3 2011 at prices between $20.18 and $31.80. The stock currently trades at around $28. For investors attempting to follow Einhorn, GM is a good option to consider.NVR Corporation (NVR): NVR is a small 0.81% of the portfolio position that was reduced by around 13% this quarter. It is a long-term position and the stake disposal indicates a mild bearish bias.Seagate Technology (STX): The large STX stake was reduced by half to a 3.99% stake this quarter at prices between $25 and $32. It was reduced by ~28% last quarter as well at prices between $24.56 and $35.67. The bulk of the stake was purchased in Q2 2011 at an average purchase price of $16.06. The stock currently trades at around $34.50. The pattern of sales indicates a bearish bias.Sprint Nextel Corporation (S): S is a 1.91% stake that was reduced by around 20% this quarter at prices between $4.90 and $5.76. The stake was reduced by around two-thirds at prices between $3.19 and $5.70 last quarter. The stock currently trades at around $5.90. The large stake reductions indicate a clear bearish bias.Yahoo Inc. (YHOO): YHOO is a 1.48% of the US long portfolio stake purchased last quarter at prices between $14.65 and $16.22 and reduced marginally this quarter. The stock currently trades at $21. Einhorn previously acquired a 3M share stake in YHOO in Q4 2011 at prices between $13.53 and $16.71 only to dispose it off the next quarter at prices between $14.42 and $16.28. The activity this quarter does not indicate any clear bias.The rest of the positions were kept steady during the quarter:Xerox Corporation (XRX): XRX is a fairly large 2.78% position first purchased at around $7.5 in Q4 2011. The stake was increased by over 70% in Q2 2012 at prices between $6.38 and $7.94. The stock currently trades at around $8. For investors attempting to clone Einhorn’s trades, XRX is a good option to consider.Virgin Media Inc. (VMED): VMED is a 2.83% of the US long portfolio stake purchased in Q2 2012 at prices between $21.50 and $25. The position is already a homerun for Einhorn as the stock currently trades at $45, around double his cost-basis. VMED stock spiked more than 10% earlier this month following the merger announcement with Liberty Global for a cash-and-stock deal at $47.87 per share.Oaktree Capital Group (OAK) and Barrick Gold Corporation (ABX): These are similar sized ~1% positions that were kept steady this quarter. The OAK position was established in Q2 2012 following its IPO at around $39 per share. The stock currently trades at $50. The 1.08% of the US long portfolio ABX position was kept steady this quarter although the stake was doubled in Q2 2012 at prices between $35.24 and $44.21. The stock currently trades below that range at around $31.63. Einhorn is very bullish on gold and also has large positions in Market Vectors Gold Miners ETF (GDX) and physical gold. The position in ABX signifies a clear bullish bias. For investors attempting to follow Einhorn, ABX is a good position to consider.Biofuel Energy (BIOF), Chipotle Mexican Grill (CMG) PUT, Einstein Noah (BAGL), Ensco PLC (ESV), Fifth Street Bank (FSC), Legg Mason Inc. (LM), Market Vectors Gold Miner ETF (GDX), Republic Awys Hldgs Inc. (RJET), State Bank Financial (STBZ), Symmetricom Inc. (SYMM), and Tessera Technologies (TSRA): These positions remained untouched during the quarter.The spreadsheet below highlights changes to Greenlight’s US stock holdings in Q4 2012:"