Activist fund Jana Partners has cut back on its biggest bet

Activist investor Barry Rosenstein, the founder of $11 billion hedge fund Jana Partners, massively cut back its stake in Qualcomm in the fourth quarter.

Jana sold
19,338,683 shares of the wireless technology developer’s stock in the final three months of 2015, the fund’s latest 13F filing shows.

The fund held 9.21 million shares at the end of the quarter.

Jana first built its stake in Qualcomm at the beginning of 2015. At the end of the first quarter, the fund disclosed a position of 28.5 million shares, a position valued at around $1.93 billion. It was the fund’s largest equity holding.

Jana had been urging the company to spin off its chip business from its patent-licensing business, The Wall Street Journal reported at the time, citing the fund’s investor letter. Jana also wanted the company to cut costs and accelerate share repurchases.

In July, the company announced a Strategic Realignment Plan endorsed by Jana aimed at cutting $1.4 billion in costs and reviewing the company’s corporate structure among other things.

Qualcomm’s stock, however, took a beating in 2015, falling more than 27% from the end of the first quarter to the end of fourth quarter.

At the end of the third quarter, Jana still held the 28.5 million shares. Based on Qualcomm’s share price of $53.20 on September 30, the position was valued around $1.52 billion.

“We continue to believe the value embedded in QCOM far exceeds the price at which it is available in the market, and that the Strategic Realignment Plan being advanced by management and the board has the potential to drive substantial returns going forward,” Rosenstein wrote in the fund’s September performance update seen by Business Insider.

During the fourth quarter, Jana sold off approximately 67% of its stake. The hedge fund’s remaining position was valued at around $460 million at the end of the fourth quarter.

In 2016, Qualcomm has continued to get bruised, falling more than 10%.

Hedge funds only have to disclose their long equity holdings every quarter in these filings. What’s more, the filings aren’t published until 45 days after the end of the quarter, so it’s possible funds could have traded in and out of positions.

We’ve reached out to Jana for comment.

Here’s a chart of Qualcomm’s performance in the last year:


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