BEKE - Tracking David Tepper's Appaloosa Management Portfolio - Q3 2023 Update

2023-12-04 10:36:51 ET

Summary

• Tepper’s 13F portfolio value decreased from ~$5.39B to ~$5.07B this quarter.
• Meta Platforms, Microsoft, Amazon.com, Nvidia, and Alphabet are the largest holdings.
• Alibaba Group Holdings, Qualcomm, Baidu, and Taiwan Semi were reduced while increasing Meta Platforms, Microsoft, and Amazon.com.

This article is part of a series that provides an ongoing analysis of the changes made to David Tepper’s 13F portfolio on a quarterly basis. It is based on Appaloosa Management’s regulatory 13F Form filed on 11/14/2023. Please visit our Tracking David Tepper’s Appaloosa Management Portfolio series to get an idea of his investment philosophy and our previous update for the fund’s moves during Q2, 2023.

This quarter, Tepper’s 13F portfolio value decreased from ~$5.39B to ~$5.07B. The number of holdings decreased from 38 to 30. The top five positions are Meta Platforms, Microsoft, Amazon.com , Nvidia, and Alphabet. They add up to ~47% of the portfolio. To know more about Tepper's distress investing style, check out the book Distress Investing: Principles and Technique.

New Stakes:

KE Holdings ( BEKE ): BEKE is a small 0.74% of the portfolio position established this quarter at prices between $13.88 and $18.30. The stock currently trades at $15.76.

Stake Disposals:

Apple Inc. ( AAPL ), Broadcom Inc. ( AVGO ), Cadence Design Systems ( CDNS ), Constellation Energy ( CEG ), iShares China Large-Cap ETF ( FXI ), KraneShares China Internet ETF ( KWEB ), Marvell Technology ( MRVL ), and Synopsys ( SNPS ): These small (less than ~2% of the portfolio each) stakes were dropped during the quarter.

Stake Increases:

Meta Platforms ( META ) : META is now the largest position at ~12% of the portfolio. It was established in Q3 2016 at prices between $114 and $131 and increased by ~50% in the following quarter at prices between $115 and $133. H2 2017 saw a stake doubling at prices between $148 and $183. The position has since wavered. Recent activity follows: Q1-Q3 2020 had seen a ~40% selling at prices between $146 and $304 while the next quarter saw a ~14% stake increase. The five quarters through Q1 2022 had seen a ~55% selling at prices between ~$187 and ~$382. There was a one-third selling during Q4 2022 at prices between ~$89 and ~$142 while Q1 2023 saw a ~22% increase at prices between ~$125 and ~$212. That was followed by a ~115% increase last quarter at prices between ~$208 and ~$289. This quarter also saw a ~30% increase at prices between ~$283 and ~$326. The stock is currently at ~$325.

Microsoft ( MSFT ) : The large (top three) ~10% MSFT stake was built in 2020 at prices between $152 and $232. The two quarters through Q2 2021 had seen a ~45% selling at prices between ~$212 and ~$272. Q1 2022 saw a ~25% stake increase at prices between ~$275 and ~$335 while the next quarter there was a roughly one-third reduction at prices between ~$242 and ~$315. There was a whopping ~375% stake increase last quarter at prices between ~$275 and ~$348. That was followed by a one-third increase this quarter at prices between ~$312 and ~$358. The stock currently trades at ~$375.

Amazon.com ( AMZN ) : The large (top three) 9.41% AMZN stake was initiated in Q1 2019 at prices between ~$75 and ~$91. The next three quarters saw a ~75% stake increase at prices between ~$84.50 and ~$101. There was a ~50% selling from Q1 to Q3 2020 at prices between ~$84 and ~$177. Q4 2020 saw an about turn: ~40% stake increase at prices between ~$150 and ~$172. There was a two-thirds selling over the next three quarters at prices between ~$148 and ~$187. Q1 2022 saw a ~20% stake increase, while during Q3 2022 there was similar selling. There was a one-third increase during Q1 2023 at prices between ~$83 and ~$113. That was followed by a ~60% increase last quarter at prices between ~$98 and ~$130. This quarter also saw a ~20% increase at prices between ~$126 and ~$145. The stock currently trades at ~$147.

NVIDIA Corp ( NVDA ) : NVDA is now a large top five position at ~9% of the portfolio. It was purchased during Q1 2023 at prices between ~$143 and ~$280. The position was increased by a whopping ~600% last quarter at prices between ~$262 and ~$438. The stock currently trades at ~$468. There was a marginal increase this quarter.

Alphabet Inc. ( GOOG ) : GOOG is currently at ~7% of the portfolio. It has been a significant presence in the portfolio since Q1 2012 and the original purchase was at prices between ~$14.50 and ~$16.25. The stake has wavered. Recent activity follows: Q1-Q3 2020 saw a ~40% reduction at prices between ~$53 and ~$86. That was followed with a ~60% reduction over the six quarters through Q2, 2022 at prices between ~$87 and ~$151. There was a ~20% stake increase this quarter at prices between ~$117 and ~$139. The stock currently trades at ~$133.

Uber Technologies ( UBER ) : UBER is now a 6.58% of the portfolio position. The original large stake was purchased in Q2 2021 at prices between ~$44 and ~$61. Q4 2021 saw that stake almost sold out at prices between ~$36 and ~$48. The position was rebuilt the following quarter at prices between ~$29 and ~$44.50, but was again sold down in Q2 2022 at prices between ~$20.50 and ~$36.50. The last three quarters saw the stake rebuilt at prices between ~$24.40 and ~$44. The stock currently trades at $57.35. There was a marginal increase this quarter.

Caesars Entertainment ( CZR ), and PDD Holdings ( PDD ) : The small 1.40% CZR stake saw a ~25% increase this quarter at prices between ~$46 and ~$59. The stock currently trades at $46.75. PDD is a 2.71% of the portfolio stake that saw the position almost double this quarter at prices between ~$68 and ~$103. The stock is now well above that range at ~$145.

Stake Decreases:

Alibaba Group Holding ( BABA ) : The ~6% BABA stake was primarily built last quarter at prices between ~$79 and ~$103. There was a ~20% selling this quarter at prices between ~$84 and ~$102. The stock currently trades at ~$74.

Advanced Micro Devices ( AMD ) : The 4.62% AMD position was purchased last quarter at prices between ~$82 and ~$129 and the stock currently trades at ~$121. There was minor trimming this quarter.

Intel Corp ( INTC ) : INTC is a 4.39% of the portfolio stake established last quarter at prices between ~$27 and ~$36, and it is now at $43.74. There was a ~8% trimming this quarter.

Qualcomm Inc. ( QCOM ) : The ~3% QCOM position was purchased last quarter at prices between ~$103 and ~$128 and the stock currently trades at ~$130. There was a ~30% selling this quarter at prices between ~$106 and ~$131.

Baidu ( BIDU ) : The 1.76% BIDU position was purchased last quarter at prices between ~$117 and ~$151 and the stock is now at ~$117. There was a ~50% reduction this quarter at prices between ~$125 and ~$156.

Taiwan Semi ( TSM ) : TSM is a 1.72% of the portfolio stake established last quarter at prices between ~$82 and ~$107, and it now goes for ~$99. There was a ~45% selling this quarter at prices between ~$84 and ~$105.

JD.com ( JD ) : The very small ~1% stake in JD saw a ~11% trimming this quarter.

Kept Steady:

FedEx Corp ( FDX ) : FDX is a 3.40% of the portfolio position purchased during Q1 2023 at prices between ~$177 and ~$229. There was an ~85% stake increase last quarter at prices between ~$217 and ~$250. The stock currently trades at ~$264.

Energy Transfer LP ( ET ) : Energy Transfer Partners merged with Energy Transfer Equity and the resulting entity was renamed Energy Transfer LP ((ET)). The transaction closed during 2018, and terms were 1.28 shares of ETE for each ETP. Tepper held shares in both, and those got converted to ET shares. There was a stake doubling in Q4 2019 at prices between $11 and $13. Next three quarters saw the stake again doubled at prices between $4.55 and $13.75 while Q2 2021 saw a ~45% selling at prices between ~$7.70 and ~$11.35. The stock is now at $13.89, and the stake is at 2.71% of the portfolio. There was a ~4% trimming last quarter.

UnitedHealth ( UNH ) : UNH is now a ~2% of the portfolio position. The stake was built in Q4 2020 and Q1 2021 at prices between ~$305 and ~$377. The next five quarters saw a ~45% selling at prices between ~$367 and ~$546. There was a one-third stake increase last quarter at prices between ~$458 and ~$526. The stock currently trades at ~$547.

EQT Corp ( EQT ) : EQT is a 1.65% of the portfolio position built over the two quarters through Q3 2021 at prices between ~$16 and ~$23. There was a ~50% reduction over the three quarters through Q3 2022 at prices between ~$20 and ~$50. That was followed by a ~20% trimming last quarter. The stock is now at $40.24.

Antero Resources ( AR ) : The ~1% stake in AR was established in Q1 and Q3 2021 at prices between ~$6 and ~$19. There was a ~55% reduction over the three quarters through Q4 2022 at prices between ~$17 and ~$48. The stock currently trades at $23.88. The last quarter saw a ~50% stake increase at prices between ~$20 and ~$24.

Arista Networks ( ANET ), ASML Holdings ( ASML ), Chesapeake Energy ( CHK ) & wts, Enterprise Products Partners ( EPD ), Lam Research ( LRCX ), MPLX LP ( MPLX ), Macy’s Inc. ( M ), Micron Technology ( MU ), and Southwestern Energy ( SWN ): These small (less than ~2% of the portfolio each) stakes were kept steady this quarter.

The spreadsheet below highlights changes to Tepper’s 13F stock holdings in Q3 2023:

Source: John Vincent. Data constructed from Appaloosa’s 13F filings for Q2 2023 and Q3 2023.

For further details see: