This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Maverick Capital Goes Big on Bank of America

Stocks in this article: BAC FDO GLW MRVL QCOM JPM SVN

BOSTON ( TheStreet) -- Maverick Capital, the $9.4 billion hedge fund run by Lee Ainslie, initiated a big stake in Bank of America (BAC - Get Report) in the fourth quarter. The firm dumped Family Dollar Stores (FDO - Get Report), now the focus of a private-equity buyout.

The Maverick fund, which has a 76-stock portfolio, held 9.5 million shares of Family Dollar, a chain of self-service retail discount stores aimed at low- and middle-income consumers, at the end of the first quarter of 2010. The fund trimmed it to 2.9 million shares at the end of the third quarter and then eliminated it by year-end, according to a Securities and Exchange Commission filing.

Activist investor Nelson Peltz offered to buy Family Dollar for about $7 billion in cash this week, setting its shares on a run. Hedge fund manager John Paulson, who earned $5 billion for himself last year by betting on gold, also exited Family Dollar.

Lee Ainslie

But Maverick hasn't missed out on much. Family Dollar's shares rose 81% in 2010, so it took the cream off the top. This year they're down about 14%.

During the fourth quarter, the fund's managers also soured on upscale clothier Abercrombie & Fitch (ANF), dropping its stake from 6.7 million shares in the previous quarter to 2.2 million at year-end.

Coincidentally, the retailer just closed out one of its strongest quarters ever, reporting a profit increase of 95% to $92.6 million. It attributed that to sharply higher international sales and a continued recovery in the U.S., when it lost market share to lower-priced teen retailers during the recession.

Among the continued biggest holdings of the fund are Marvell Technologies (MRVL - Get Report), a manufacturer of mixed-signal and digital-signal processing integrated circuit for high-speed, high-density, digital data storage and broadband digital data networking markets, at 20 million shares, and Qualcomm (QCOM - Get Report), a maker of digital wireless communications products and services based on the company's patented CDMA digital technology, at 7.1 million shares.

Big holdings in the financial services sector include JPMorgan Chase (JPM - Get Report), at 8.5 million shares, and a new holding, Huntington Bancshares (HBAN), at 13 million shares.

Ainslie, based in Dallas, sent out his annual investors' newsletter summarizing 2010 activity within the past two weeks and in it he reported that Maverick's main fund returned 11.2% for 2010, while its Levered Fund returned 30.1%. The S&P 500 returned 15% last year.

On the following pages is a closer look at Maverick's holdings.

>>View Maverick Capital's Portfolio

1 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,672.60 -141.38 -0.79%
S&P 500 2,051.82 -11.33 -0.55%
NASDAQ 4,757.8790 +7.4820 0.16%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs