August 13th, 2009
Last week HedgeTracker.com released its list of Top Solar-Focused hedge funds by percentage of assets. This week we look at the top hedge funds based on their total investment in the solar sector. The only hedge fund to make both of HedgeTracker’s lists is Partner Fund Management. The others on this week’s list include: Maverick Capital, Water Street Capital, Seasons Capital Management, Alkeon Capital Management and Galleon Management.
The top solar hedge fund investor is Lee Ainslie’s Maverick Capital. Mr. Ainslie is a “Tiger Cub,” or a former protégé of Julian Robertson of Tiger Management. As of Q1 ’09, the fund had $180.33mm of its $5,529mm, or 3.26% of its portfolio, invested in solar. However, Maverick Capital is not necessarily a believer in the solar sector overall, as the firm’s solar exposure is entirely concentrated in First Solar Inc. (FSLR) with 1,358,902 shares. Notably, over the first quarter, the firm purchased $85.29mm or 642,756 shares of FSLR.
Water Street Capital, a Jacksonville, Florida-based hedge fund manager, was the next largest solar sector investor with $67.61mm. Over the quarter, Water Street purchased $44mm in FSLR. Its solar holdings include:
First Solar Inc. (FSLR) - $44.03mm, 331,800 shares
Energy Conversion Devices Inc. (ENER) - $18.25mm, 1,375,600 shares
LDK Solar Co. (LDK) - $2.97mm, 468,900 shares
Next on the list is Long/Short equity manager Seasons Capital Management , with a total sector holding of $53.08mm. Like Maverick Capital, the only solar position held by Seasons Capital is First Solar Inc. (FSLR) - $53.08mm, 400,000 shares. The San Francisco-based firm was founded in 2003 by Ravi Kaza and focuses on the technology, media, telecom, consumer, and infrastructure sectors.
Partner Fund Management, another San Francisco-based investor, is fourth on the list, holding $49.49mm in solar equities. The firm’s holdings consist of:
First Solar Inc., (FSLR) - $38.96mm, 293,585 shares, Change $33.03mm
Suntech Power Holdings Co., (STP) - $8.12mm, 694,952 shares, Change $6.95mm
JA Solar Holdings Co., (JASO) - $2.30mm, 683,847 shares, Change $1.49mm
Partner Fund also sold out of $1.71mm of Yingli Green Energy Holding Co. (YGE), $1.05mm of LDK Solar Co., (LDK), and $0.26mm of Evergreen Solar Inc. (ESLR).
Fifth on the list is Takis Sparaggis’ Alkeon Capital Management with a total of $37.88mm invested in the solar sector. The technology-focused hedge fund’s exposure to the solar sector is concentrated in two equities, that of:
First Solar (FSLR) - $32.15mm, 242,301 shares, Change -$2.38mm and
Suntech Power (STP) - $5.73mm, 489,920 shares, Change $5.73mm.
Raj Rajaratnam’s Galleon Management , which also specializes in the technology sector, is the final hedge fund on the list with $36.45mm. Galleon’s solar exposure is spread across 6 solar stocks. Over the first quarter, the firm added to its FSLR, STP, JASO and ENER positions, while it trimmed its exposure to YGG and ESLR. The firm’s holdings were:
First Solar (FSLR) - $25.21mm, 190,000 shares, Change $8.48mm
Suntech Power (STP) - $3.92mm, 335,000 shares, Change $2.98mm
Yingli Green Energy (YGE) - $3.46mm, 575,000 shares, Change -$5.03mm
JA Solar (JASO) - $3.12mm, 925,000 shares, Change $1.08mm
Energy Conversion Devices (ENER) - $0.53mm, 40,000 shares, Change $0.53mm
Evergreen Solar (ESLR) - $0.21mm, 100,000 shares, Change -$0.05mm
During last quarter’s solar report, we noted that Chase Coleman’s Tiger Global Management was the largest buyer of solar stocks over the fourth quarter of 2008, when it purchased approximately $65 million in the sector. Like Maverick’s Lee Ainslie, Mr. Coleman is also a “Tiger Cub” and actually still shares an office with Julian Robertson. This quarter, Mr. Coleman reversed his solar bets, selling completely out of the sector. Tiger Global’s sells included: Yingli Green Energy (YGE) for $12.34mm, LDK Solar (LDK) for $16.01mm, and JA Solar (JASO) for $22.28mm
With the solar sector still in a nascent stage of development, hedge funds continue to actively adjust their sector investment bets. While FSLR seems to be the early favorite, the other emerging companies are still fostering great interest from top hedge fund managers seeking out growth opportunities.
The solar sector used for this analysis, included: First Solar Inc. (FSLR), Suntech Power Holdings (STP), SunPower Corp. (SPWRA & SPWRB), Yingli Green Energy Holding (YGE), LDK Solar Co. Ltd. (LDK), Energy Conversion Devices (ENER), JA Solar Holdings Co. (JASO), Evergreen Solar Inc. (ESLR), Trina Solar Ltd. (TSL), ReneSola Ltd (SOL), Canadian Solar Inc. (CSIQ), Solarfun Power Holdings (SOLF), and Ascent Solar (ASTI).
For more information on the hedge funds and portfolio managers mentioned in this article, please see their “Detailed Investor Profile” below. To see HedgeTracker’s Complete Hedge Fund Directory, click here.
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