This article is part of a series that provides an ongoing analysis of the changes made to Robert Karr’s 13F stock portfolio on a quarterly basis. It is based on Karr’s regulatory 13F Form filed on 02/14/2020. Please visit our Tracking Robert Karr’s Joho Capital Portfolio article for an idea on his investment philosophy and our last update for the fund’s moves during Q3 2019.
This quarter, Karr’s 13F stock portfolio value increased ~19% from $566M to $671M. The number of holdings remained steady at 11. The top three positions represent ~68% of the 13F assets: Floor & Décor Holdings (NYSE:FND), Alibaba Group Holdings (NYSE:BABA), and Microsoft (NASDAQ:MSFT).
Karr was one of the most successful among the “tiger cubs” (protégés of Julian Robertson and his legendary Tiger Fund). Although Karr’s main expertise is in Asian equities, ~30% of the assets are typically in US-listed 13F securities. The fund (1996 inception) closed to outside money and became a Family Office in 2014. To know more about Robert Karr and “tiger cubs”, check out the book Julian Robertson: A Tiger in the Land of Bulls and Bears.
New Stakes:
ServiceNow Inc. (NOW): NOW is a 2.78% of the portfolio stake established this quarter at prices between $220 and $290 and the stock currently trades well above that range at $330.
Stake Disposals:
The RealReal Inc. (REAL): REAL was a minutely small 0.14% position. They had an IPO last June. Shares started trading at ~$29 and currently goes for $14.97. The position was built in Q2 and Q3 2019 but was disposed this quarter.
Stake Increases:
Global Payments (GPN): GPN is a large ~19% of the portfolio stake established in Q2 2019 at prices between $136 and $163. It was increased by ~200% last quarter at prices between $154 and $175. The stock currently trades at $191. This quarter also saw a ~14% stake increase.
Livent Corp (LTHM): LTHM is a ~5% of the portfolio stake established last quarter at prices between $5.50 and $7.75 and increased by ~60% this quarter at prices between $6.45 and $8.95. Livent is a spin-off from FMC Corporation (FMC) that started trading in October 2018 at ~$16.25 per share. The stock currently trades at $9.54.
Estee Lauder (EL): EL is a very small 0.51% stake established during H1 2018 at prices between $128 and $158 and reduced by ~25% in Q4 2018 at prices between $122 and $153. Q1 2019 saw a ~55% stake increase at prices between $125 and $166 while next quarter there was a ~25% selling at prices between $161 and $184. There was a one-third increase this quarter at prices between $182 and $208. The stock currently trades at ~$191.
Stake Decreases:
Flood & Décor Holdings (FND): FND is currently the largest 13F stake at ~25% of the portfolio. It was established in Q1 2018 at prices between $44 and $52 and increased by ~60% next quarter at prices between $45 and $58. There was a stake doubling in Q3 2018 at prices between $30 and $52 and that was followed with a ~90% increase next quarter at prices between $24 and $34.50. The last four quarters have seen a ~40% selling at prices between $27 and $51. The stock currently trades at $56.80.
Note: Joho Capital’s ownership stake in FND is 3.3%.
Farfetch Ltd. (FTCH): FTCH was a ~17% of the portfolio stake established in Q4 2018. Farfetch had an IPO on September 21, 2018. Q1 2019 saw a ~30% stake increase at prices between $16.40 and $29.70. That was followed with a ~90% increase next quarter at prices between $19 and $27. The pattern reversed last quarter: position sold down by ~80% to a very small 1.55% portfolio stake at prices between $7.75 and $22. This quarter saw a further 60% selling to a 0.66% portfolio stake at prices between $7.50 and $11. The stock currently trades at $10.17.
Four Seasons Edu Cayman (FEDU): FEDU is now a very small ~0.50% of the portfolio stake. It was first purchased in Q1 2018 at prices between $6 and $10. Q2 2019 saw a ~5% trimming and that was followed with a ~12% trimming last quarter. There was a ~63% selling this quarter at prices between $1.55 and $2.20. The stock is now at $1.68. Karr realized losses.
Kept Steady:
Alibaba Group ADR (BABA): BABA is Karr’s second-largest position at ~22% of the portfolio. It was established in Q2 2015 at prices between $79.50 and $94 and almost doubled the following quarter at prices between $57 and $84. Q1 2016 saw another ~50% increase at prices between $60.50 and $81.50. The next two quarters had also seen a ~21% combined increase at prices between $74 and $109. There was an ~8% trimming in Q2 2017 and that was followed with a ~20% selling the following quarter at prices between $141 and $180. There was another similar trimming in Q4 2017 at prices between $169 and $191. The stock currently trades at ~$206. The last two years have seen only minor activity.
Microsoft Corp (MSFT): MSFT is a large (top three) 21% of the portfolio position purchased in Q1 2019 at prices between $97 and $120 and increased by ~90% next quarter at prices between $119 and $138. The stock currently trades well above those ranges at ~$168. The last quarter also saw a ~14% stake increase.
Spotify Technology (SPOT): The ~3% of the portfolio SPOT stake was established in Q1 2019 at prices between $109 and $151. The last quarter saw a one-third selling at prices between $112 and $158. The stock is now at ~$142.
Cognex Corporation (CGNX): Cognex was a large ~9% CGNX stake as of Q2 2019. It was first purchased in Q3 2015. The stake was increased by ~340% the following quarter at prices between $17 and $19. The position had since wavered. The last quarter saw the stake sold down by ~90% to a very small ~1% portfolio stake at prices between $42 and $51. The stock is now at $46.94. Karr harvested gains from this position.
Note: The prices quoted above are adjusted for the two-for-one stock split in December 2017.
The spreadsheet below highlights changes to Karr’s 13F stock holdings in Q4 2019:
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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