While many investors, including Warren E. Buffett, were selling energy stocks in the final three months of 2014, several hedge funds sought to profit on the turmoil, regulatory filings showed on Tuesday. Third Point, the firm run by Daniel S. Loeb, acquired a sizable stake in the oil refinery company Phillips 66, while Leon G. Cooperman’s Omega Advisors amassed a new position in Laredo Petroleum, and Viking Global Investors, led by Andreas Halvorsen, increased its stake in Cheniere Energy by several million shares.
At the same time, other hedge funds reduced their holdings of technology stocks, including Apple and Alibaba, which had recently attracted investors in droves.
These moves, by some of Wall Street’s most prominent investors, were disclosed in filings with the Securities and Exchange Commission, providing a partial snapshot of hedge funds’ holdings as of the end of the year. The filings, submitted by a Tuesday deadline, shed some light on which companies and sectors were attracting the affection — or the skepticism — of the so-called smart money.
Investing in energy in recent months has required a strong stomach. The price of a barrel of crude oil, after trading around $100 in June, fell to about $43 in January, putting pressure on a range of oil and gas companies and funds that invested heavily in energy stocks. The filings show Mr. Buffett’s Berkshire Hathaway sold its 41 million shares of Exxon Mobil during the fourth quarter, while Greenlight Capital, David Einhorn’s hedge fund, sold its entire two million-share stake in the British oil giant BP. Barry Rosenstein’s Jana Partners sold its 3.4 million shares in the Apache Corporation, the oil and gas company.
To some hedge fund managers, the rout apparently provided an opportunity for bottom-fishing. Mr. Loeb’s Third Point acquired five million shares of Phillips 66, a stake worth $384.5 million as of Tuesday. Omega Advisors, meanwhile, acquired 2.1 million shares of Laredo Petroleum and 652,500 shares of Sanchez Energy Corporation. But at the same time, Omega sold about 29 percent of its big stake in SandRidge Energy, ending the quarter with 32.2 million shares.
ValueAct Capital, an activist hedge fund, acquired big new positions in Halliburton and Baker Hughes, two oil field services companies that agreed to a $34.6 billion merger in November. The two stakes, each worth more than $900 million, could make ValueAct a forceful advocate for the deal, which will be subject to shareholder votes in March.
While it is far from certain that these energy bets will pay off, some stocks in the sector are showing signs of improvement. Fairholme Capital Management, the fund founded by Bruce R. Berkowitz, bought a stake in the oil and gas company Canadian Natural Resources, whose shares fell 20.5 percent in the fourth quarter but are up 3.6 percent so far this year. Similarly, Eton Park Capital Management, which was started by a Goldman Sachs alumnus, Eric Mindich, bought shares of the natural gas producer EQT. That company’s stock fell 17.3 percent in the fourth quarter but is up 7.8 percent this year.
Some hedge funds showed caution in the technology sector. One longtime fan of Apple, Mr. Einhorn, who once took the company to court over a plan to eliminate preferred shares, reduced Greenlight Capital’s stake in Apple by about 6 percent, to 8.6 million shares, which were worth more than $1 billion as of Tuesday. Another hedge fund, Coatue Management, which focuses on technology, reduced its Apple holdings by about 15 percent, to 8.9 million shares, as of the end of 2014.
Appaloosa Management, David Tepper’s hedge fund, sold its entire 1.2 million-share stake in Apple, as well as its holdings in Facebook and the Chinese Internet giant Alibaba, which became a hedge fund darling after going public in September. Mr. Tepper’s move on Alibaba appears well-timed, since the stock fell this year after peaking in the fall. With Apple, however, Mr. Tepper and his rivals have been confounded by the stock’s rally so far this year.
These disclosures are limited in important ways. Backward-looking and static, they show only the holdings of United States-listed stocks at the end of the fourth quarter. And they do not include any short positions, or bets against particular stocks.
What’s more, any apparent trends among the hedge funds fail to capture the diversity of the moves. Mr. Loeb, for example, increased his fund’s existing stake in Alibaba during the quarter, while Mr. Einhorn acquired a new stake in Yahoo, an older technology giant. Greenlight Capital also bought 1.25 million shares of Green Dot, one of the nation’s largest sellers of prepaid debit cards. This month, Green Dot, as previously announced by the company, stopped selling its popular MoneyPak prepaid product over concerns about it being misused by online swindlers.
In addition to showing what stocks are getting attention, the filings help reveal how upstart hedge funds are mapping their strategies.
Among the most closely watched of these funds are those run by disciples of Steven A. Cohen, the head of the former SAC Capital Advisors. That firm pleaded guilty to securities fraud in 2013 and has since rebranded itself as Point72 Asset Management, a $10 billion family office that manages mainly Mr. Cohen’s personal fortune.
Gabriel Plotkin, who was one of the top portfolio managers at SAC, set out on his own last year, raising about $1 billion, including a $200 million commitment from Mr. Cohen, for his own hedge fund, Melvin Capital Management.
And Mr. Plotkin did not waste much time putting that money to work, taking positions in more than 40 stocks with an estimated value of $900 million, according to the fund’s regulatory filing. Mr. Plotkin specialized in investing in consumer stocks at SAC, and Melvin Capital appears to be no different, with the fund buying stakes in Amazon.com, the Del Frisco’s Restaurant Group, Deere & Company, Dick’s Sporting Goods, Foot Locker and Yum Brands.
Other relatively new hedge funds led by former disciples of Mr. Cohen are Aaron Cowen’s Suvretta Capital Management and Jason Karp’s Tourbillon Capital Partners. In the fourth quarter, Suvretta reported selling a 467,000-share position in Anadarko Petroleum and a 223,890-share position in Ashland, a specialty chemical company. The fund acquired a new 629,600-share position in Facebook in the period.
Tourbillon, in the fourth quarter, purchased a new 1.45 million share stake in Applied Materials and increased its stake in Cheniere Energy by about 630,000 shares. The fund exited a 280,000-share position in Zebra Technologies.