Wed, Dec 13, 2017
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Microsoft attracting major hedge funds - report

Tuesday, August 31, 2010
Opalesque Industry Update - Technology and software giant Microsoft Corp., has attracted the attention of major hedge fund managers in the second quarter. TPG-Axon Capital Management’s Dinakar Singh and Greenlight Capital’s David Einhorn, both raised their Microsoft shares, to take advantage of record low price-to-earning multiples, reported Reuters.

Microsoft shares fell 20% from May to June, but market analysts predict a major rebound in the last quarter of this year. Whitney Tilson, Managing Partner of T2 Partners LLC and the Tilson Mutual Funds, who also bought Microsoft shares in the second quarter, told Reuters that the software firm’s stocks are currently trading “insanely cheap for a company of this caliber and market position.”

Other hedge funds which saw an undervalued opportunity in Microsoft’s Windows 7 operating system and Office franchise, are John Griffin's Blue Ridge and Thomas Claugus's GMT Capital, the report said.

Patrick Becker Jr., at Becker Capital Management explained that although Microsoft is a lot more profitable than its rival Apple Inc., the latter it is rewarded with a higher multiple by investors excited by a stream of innovative products like the iPhone and iPad. Microsoft’s value is overlooked in comparison.

Early this month, Einhorn reported a major move into the technology sector when he doubled his stake in Microsoft to 66 million shares up from 3.4 million shares as of March 31, and in Xerox by more than 90%, from 6.5 million to 13.5 million shares. In his quarterly regulatory filing with the Securities and Exchange Commission, Einhorn added he also bought 312,500 shares in Apple Inc, according to another Reuters report.

Each of Einhorn's Greenlight Capital funds posted returns of 1.6%, 2.2% and 0.8%, respectively during the second quarter of this year, according to the firm’s quarterly letter to investors. By comparison, the benchmark Standard & Poor's 500 and Dow Jones industrials average each lost at least 6% in the period (see this month’s Opalesque Exclusive here).

Hedge funds also stocking up in steel broadcast towers
Hedge funds have also been seeking out surer ways to profit from the growing popularity of mobile web-surfing. According to Reuters yesterday, investors are hugely attracted to the low-risk, high-growth prospects of the steel broadcast towers operated by American Tower Corp, Crown Castle International and SBA Communications.

As a result, several of the largest equity-oriented hedge funds, including Andreas Halvorsen's Viking Global Investors, Julian Robertson's Tiger Global Management, Steve Mandel's Lone Pine Capital and Domenic Ferrante of Brookside Capital Investors, boosted their positions in one or more of the stocks in the second quarter, according to a Thomson Reuters survey of regulatory filings.

Microsoft to spend close to $1bn in marketing blitz for Windows Phone 7
In a bid to catch up against rivals Apple and Google, Microsoft has announced plans to spend at least $400m to market its Windows Phone 7 operating system, during the upcoming holiday season.

But a telecom analyst for Deutsche Bank Jonathan Goldberg predicted that Microsoft may end up spending $1bn to make and release the operating system as the firm continues to lose ground in the increasingly crowded smart-phone market by Apple's iPhone, Research in Motion's BlackBerry and Google's Android, which is the most popular smart-phone operating system in the U.S.
- Precy Dumlao
PD

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Mediobanca acquires majority stakes in Swiss hedge fund[more]

    Komfie Manalo, Opalesque Asia: Listed diversified banking group Mediobanca SpA said it has acquired a majority stake in Geneva-based hedge fund firm RAM Active Investments SA (RAM AI), an active and alternative asset manager offering a range of act

  2. North America - Miami could attract hedge funds if SALT deductions axed[more]

    From Law360.com: For years, inertia has been Nitin Motwani's greatest foe in his attempts to lure hedge fund owners in the northeast to Miami, which he has pitched as a tropical low-tax paradise. But with the Republican tax bill proposing to eliminate deductions for state and local taxes, he's sensi

  3. Northleaf Capital Partners closes debut private credit fund on $670M[more]

    Bailey McCann, Opalesque New York: Northleaf Capital Partners has closed its debut private credit fund - Northleaf Private Credit I - on $670 million. The vehicle will invest in private credit transactions in Europe and North America, with a primary focus on lending to private equity-backed compa

  4. ...And Finally - The ongoing gun saga in the U.S.[more]

    From Newsoftheweird.com: As elder members of the First United Methodist Church in Tellico Plains, Tennessee, gathered on Nov. 16 to discuss the recent church shooting in Sutherland Springs, Texas, one of those present asked if anyone had brought a gun to church. One man spoke up and said he c

  5. Opalesque Exclusive: Credit Suisse Asset Management's NEXT Investors leads $6M Series A round for LUX Technology and Services[more]

    Bailey McCann, Opalesque New York: Credit Suisse Asset Management's NEXT Investors has led a $6 million Series A funding round for LUX Technology and Services, a business and technology solutions provider for the alternative assets industry. The investment will be used to fuel growth of Trans