CPNG - Tracking David Abrams' Abrams Capital Management Portfolio - Q3 2023 Update

2023-11-28 23:26:48 ET

Summary

• Abrams' 13F portfolio value decreased from $3.48B to $3.03B this quarter, with the number of holdings decreasing from 16 to 14.
• The top three stakes make up approximately 49% of the portfolio, while the top five holdings account for around 67%.
• TransDigm Group stake was disposed, and Meta Platforms stake was reduced during the quarter.

This article is part of a series that provides an ongoing analysis of the changes made to David Abrams' 13F portfolio on a quarterly basis. It is based on Abrams' regulatory 13F Form filed on 11/13/2023. Please visit our Tracking David Abrams' Abrams Capital Management article for an idea on his investment philosophy and our last update for the fund's moves during Q2 2023.

This quarter, Abrams' 13F portfolio value decreased from $3.48B to $3.03B. The number of holdings decreased from 16 to 14. The top three stakes are at ~49% of the 13F portfolio while the top five holdings are at ~67%.

Stake Disposals:

Horizon Therapeutics: Horizon Therapeutics was a merger-arbitrage stake established last quarter. Amgen ( AMGN ) acquired Horizon Therapeutics in a $116.50 cash deal announced last December. The acquisition closed last month thereby eliminating this stake.

TransDigm Group (TDG): The large ~8% TDG position was purchased in Q1 2020 at prices between $246 and $658 and the stock currently trades at ~$956. There was a roughly one-third reduction during Q4 2022 at prices between ~$510 and ~$640. That was followed by a ~15% trimming last quarter. The stake was disposed this quarter at prices between ~$843 and ~$914.

Stake Increases:

Lithia Motors (LAD): LAD is currently in the largest position at ~23% of the portfolio. It was established in Q2 2018 at prices between $95 and $105 and almost doubled the next quarter at prices between $81 and $99. The stock is now at ~$268. There was a minor ~2% stake increase this quarter.

Note: Their ownership stake in Lithia Motors is at ~9%.

Stake Decreases:

Meta Platforms (META): META is a large (top five) 9.21% portfolio position purchased in Q4 2018 at prices between $124 and $163. Q1 2020 saw a ~18% stake increase at prices between $146 and $223. Q4 2022 saw another ~80% stake increase at prices between ~$89 and ~$140. There was a ~47% selling last quarter at prices between ~$208 and ~$289. That was followed by a ~18% reduction this quarter at prices between ~$283 and ~$325. The stock currently trades at ~$339.

Kept Steady:

Asbury Automotive (ABG): ABG is a top-three ~16% position established in Q3 2017 at prices between $50 and $62 and increased by ~45% in Q3 2018 at prices between $67 and $77.50. Next quarter saw another 20% stake increase at prices between $59 and $72. Q1 2020 also saw a ~11% stake increase at an average cost in the high 40s. The stock currently trades at ~$209.

Note: Their ownership stake in the business is ~9%.

Alphabet Inc. (GOOG): GOOG is a large ~10% position purchased in Q2 2018 at prices between ~$50 and ~$59. There was a ~20% stake increase in Q1 2020 at prices between ~$53 and ~$76. Q4 2022 saw a ~20% selling at prices between ~$83.50 and ~$105. The stock is now at ~$139. There was marginal trimming last quarter.

Energy Transfer LP (ET): The 8.27% ET stake was established in Q1 2020 at prices between $4.55 and $13.75. There was a ~64% stake increase in Q3 2020 at prices between $5.40 and $7.15 while in Q4 2022 there was a ~20% selling at prices between ~$11 and ~$12.75. The stock is now at $13.67.

Coupang, Inc. (CPNG): The 7.31% CPNG stake was purchased in Q3 2021 at prices between ~$27 and ~$44.50. Next quarter saw a ~120% stake increase at prices between ~$25.50 and ~$30.50. That was followed with a ~40% stake increase in Q1 2022 at prices between ~$15.50 and ~$28.75. The stock is now at $16.08. The last quarter saw a minor ~3% trimming.

U-Haul Holding Company (UHAL): UHAL is a ~7% position purchased in Q4 2016 at prices between $31 and $37 and increased by ~160% the following quarter at prices between $37 and $39. There was a ~45% increase in Q2 2017 at prices between $34 and $39 and that was followed with a similar increase in H1 2018 at prices between $32 and $38. Q4 2021 saw a ~20% reduction at prices between ~$65 and ~$76. The stock is now at ~$56.

Note: the prices quoted above are adjusted for the 10-for-1 stock-split last November.

Willis Towers Watson plc (WTW): WTW is a 5.57% position purchased in Q1 2017 at prices between $117 and $133. Since then, the activity has been minor. Q4 2022 saw a ~25% selling at prices between ~$201 and ~$248. The stock is now at ~$242.

Tempur Sealy International (TPX): TPX is a ~5% of the portfolio stake established in Q3 2021 at prices between ~$37.50 and ~$49.60 and the stock currently trades at $39.28.

Camping World Holdings (CWH): CWH is a 3.45% position purchased in Q3 2018 at prices between $19 and $27 and increased by two-thirds next quarter at prices between $11.25 and $22.50. Q2 2019 saw a ~30% stake increase at prices between $11 and $13 per share. Q4 2019 also saw a ~12% stake increase at ~$7.90 per share while in Q3 2020 there was similar selling at ~$37.50. The stock is now at $21.50. They control ~12% of the business.

Teva Pharmaceutical (TEVA): TEVA is a 2.68% of the portfolio stake established in Q3 2017 at prices between $15.50 and $33.50. Q3 2019 saw a one-third stake increase at prices between $6 and $9.60. Q4 2022 saw a one-third reduction at prices between ~$8 and ~$9.50. That was followed with a ~50% selling in the next quarter at prices between ~$8.35 and ~$11.40. The stock currently trades at $9.80.

Cantaloupe, Inc. (CTLP): The small 1.48% CTLP position was purchased in Q1 2021 at prices between ~$9.45 and ~$12.45. Q1 2022 saw a ~50% stake increase at prices between ~$6.50 and ~$8.75. That was followed with a ~130% increase during Q1 2023 at prices between ~$4.35 and ~$6.20. The stock is now at $7.05.

USCB Financial Holdings (USCB): USCB is a minutely small 0.23% portfolio position established in Q3 2021. The stake saw a ~23% selling during Q4 2022.

Nuvation Bio (NUVB): Panacea Acquisition merged with Nuvation Bio in a de-SPAC transaction that closed in February 2021. The stake was established during that quarter when it traded between ~$9 and ~$14.60. It currently trades at $1.27, and the stake is at 0.17% of the portfolio.

The spreadsheet below highlights changes to Abrams' 13F stock holdings in Q3 2023:

For further details see: