The latest 13F season is here, when many money managers issue required reports on their holdings. It can be worthwhile to pay attention to these reports, as you might get an investment idea or two by seeing what some major investors have been buying and selling.
For example, consider George Soros, known to some folks these days for his politics and philanthropy. His fame initially stemmed from his wealth, which is a result of his outstanding investing prowess. He founded Soros Fund Management in 1973, and under its umbrella the Quantum funds reportedly averaged close to 20% annual growth over four decades As The New York Times has explained: "His huge gains have come from macro bets, which aim to profit from global economic trends by trading currencies, commodities, bonds and other securities. Mr. Soros made his name, however, betting on currencies." Soros has noted, though, that hedge funds can't beat the market due to their fees.
Soros Fund Management's reportable stock portfolio totaled $10.1 billion in value as of March 31, 2014. Its latest 13F report shows that it established or added to positions in Yamana Gold (AUY), Magnum Hunter Resources (NYSE: MHR), and RF Micro Devices (NASDAQ: RFMD).
Yamana Gold has lost a third of its value over the past year, and it yields about 2%. (The yield reflects a 42% dividend cut in February.) Its last quarter was mixed, in part due to lower gold prices and higher costs, though management has explained that it is front-loading many expenses and expects improvement down the line. Recently, Yamana joined with Agnico Eagle Mines to acquire Osisko Mining. The deal will boost Yamana's production, but its debt load is now considerably larger -- though its overall debt profile is still better than many peers. Still, bulls like the company's prospects, especially now with Osisko's relatively low-cost, low-risk assets.
Yamana Gold has also been working to increase production while focusing on quality, and has initiated "cost containment and margin reclamation initiatives." Some worry, though, that cost-cutting will lead to lower production.
Magnum Hunter Resources is a Texas-based oil and natural-gas company. It aims to boost its natural-gas drilling in the Utica and Marcellus shale regions, and has raised additional funds for this effort by selling some oil assets and a private placement of stock. The company has more pipeline access than some rivals, which will help it turbocharge growth. Its first quarter featured a 59% pop in adjusted production. Magnum Hunter nearly doubled production between 2012 and 2013, and it intends to more than double production this year.
RF Micro Devices specializes in high-performance radio-frequency technology. Its performance numbers have deteriorated a bit in recent years, but its merger this year with TriQuint Semiconductor (TQNT.DL) should deliver cost savings and add management expertise. The new, bigger company may also wield more pricing power with the companies it supplies, such as Apple and Samsung. TriQuint's gross margin has surged, and it has increased its projections. RF Micro Devices is involved in a wide variety of promising areas, such as the Internet of Things, automotive Wi-Fi, and wearable gadgets. It also offers geographic diversification, with its low-cost products likely to sell well in emerging markets.
