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Kyle Bass Gets In On Herbalife, Microsoft, J.C. Penney

Stocks in this article: BTU HLF PMT TPX VOD VVUS

Kyle Bass’ Hayman Capital got in on a few embattled and controversial stocks during the September quarter. His latest 13F filing shows that his new stocks for the September quarter included Herbalife Ltd (HLF), J.C. Penney Company, Inc. (JCP) and Microsoft Corporation (MSFT).

During the third quarter of the year, Kyle Bass’ firm bought 11 new stocks and increased its holdings in two other stocks. It also exited three stocks but did not cut its position in any companies.

Kyle Bass picks up embattled stocks Herbalife, J.C. Penney

Bass’ new position in Herbalife Ltd (HLF) is especially interesting because this stock is one that just keeps dragging investors in. Hedge fund manager and activist investor Bill Ackman announced a big short of Herbalife almost a year ago and called the company a pyramid scheme. Since then, other hedge fund managers have been lining up.

Bass is one of the most recent to get in on the action, according to his regulatory filing. In February, Bass said he hadn’t done any research on Herbalife and didn’t have any shares of it. Apparently he’s done his research since then. His position was worth more than $30.4 million at the end of September, and he owned more than 436,000 shares at that time. Stanley Druckenmiller also got in on the Herbalife action during the September quarter, according to his regulatory filing released today as well.

Another interesting new stock for Kyle Bass is J.C. Penney Company, Inc. (JCP). This is another one that’s been in the spotlight thanks to Bill Ackman. Unlike Herbalife Ltd (HLF) at least so far, Ackman actually backed off of J.C. Penney. During the September quarter, Bass snapped up almost 5.7 million shares of the retailer.

Bass’ other new stocks

Another big purchase during the third quarter was Microsoft Corporation (MSFT) of which Kyle Bass bought 1.5 million shares. The tech giant became his fourth biggest holding, making up 12% of his portfolio. He also picked up 1.3 million shares of Vodafone Group Plc ADR (VOD) and 3.6 million shares of PennyMac Mortgage Investment Trust (PMT), which became his largest position.

Bass' increased holdings and stock exits

During the third quarter of the year, Kyle Bass added to his position in Tempur Sealy International Inc (TPX), making it his second largest position. His other increased holding was Dex Media Inc (DXM).

All of Bass’ exits during the quarter were call options: Apple Inc. (AAPL), VIVUS, Inc. (VVUS) and Peabody Energy Corporation (BTU).

-By Michelle Jones


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