Brad Gerstner’s Altimeter Capital has an $8B profit on Snowflake. A new $450M tech SPAC. And annual 13F returns of 30% since 2011.

0
105

Back in 2013, Bloomberg ran a profile of Brad Gerstner’s Altimeter Capital that described the up-and-coming hedge fund manager as an adventurer — an amateur pilot and heli-skier who hangs out with big-time CEOs at Burning Man. The article said Gerstner wanted to build a Venture Capital Empire.

Fast forward seven years, and Gerstner has pretty much achieved his goal. Altimeter has seen successes like Priceline (BKNG), Expedia (EXPD), Uber (UBER), Twilio (TWLO) and Hubspot (HUBS). Then there’s Snowflake (SNOW). Altimeter was the lead investor for the software company’s $79 million Series C funding round in June 2015, according to Crunchbase. With SNOW currently trading at $242, that stake is now worth $8.8 billion.

Capitalizing on the fund’s VC success, Gerstner raised $450M for Altimeter Growth Corp (AGCUU), a blank check company IPO targeting the tech sector. AGCUU went public at $10 on Oct. 1, and closed Tuesday at $11.80.

But while Gerstner has built a VC juggernaut, Altimeter Capital’s public investments have been none-to-shabby. Gerstner has proven himself to be a world-class stock picker. Since 2011, holding an equal-weight portfolio of the fund’s top 20 13F positions, and rebalancing quarterly, would have generated average annual returns of 29.52%. That’s nearly 2.2x the annual return of the S&P 500 over that period.

WhaleWisdom gives Altimeter Capital a WhaleScore of 99 — meaning Gerstner’s fund ranks near the pinnacle of 13F performance among all hedge fund’s long portfolio performance.

Gerstner has maintained exceptional performance despite Altimeter’s 13F assets growing from $427M to $4.7 billion over the last eight years.

Altimeter Capital 13F performance since Q4 2011. Equal weighting of top 20 holdings, rebalanced quarterly.

Brad Gerstner’s Altimeter Capital. 13F holdings as of Q2 2010.

StockSectorShares HeldMarket Value% of PortfolioRank% Change sharesQtr 1stEstimated PriceSourceSource Date
SNOWINFORMATION TECHNOLOGY36,706,307$8,809,513,68064.91New13G9/18/20
UBERCONSUMER DISCRETIONARY28,911,000$898,554,0006.622-7%Q2 201930.8013F6/30/20
FBCOMMUNICATIONS3,753,400$852,285,0006.2830%Q1 2018141.6113F6/30/20
PDDCONSUMER DISCRETIONARY8,690,000$745,950,0005.540%Q3 201825.7113F6/30/20
CRMINFORMATION TECHNOLOGY3,153,823$590,806,0004.3550%Q4 2016145.8913F6/30/20
EXPECONSUMER DISCRETIONARY5,319,216$437,240,0003.22635%Q4 201397.2913F6/30/20
MSFTINFORMATION TECHNOLOGY1,097,135$223,278,0001.647108%Q1 2018155.4813F6/30/20
BKNGCONSUMER DISCRETIONARY136,402$217,198,0001.680%Q4 20111483.1213F6/30/20
UALTRANSPORTS4,803,279$166,241,0001.229-55%Q4 201154.5013F6/30/20
MDBINFORMATION TECHNOLOGY452,000$102,306,0000.751050%Q4 2017133.8113F6/30/20

Brad Gerstner’s Altimeter Capital. New holdings for Q2 2020.

StockSectorShares HeldMarket Value of portfolio% of portfolioRankChange in shares% Change% OwnershipSourceSource Date
SNOWINFORMATION TECHNOLOGY36,706,307$8,809,513,68064.9136,706,307New13.27%13G9/18/20
VRMCONSUMER DISCRETIONARY799,281$41,675,0000.3116799,281New0.67%13F6/30/20
DGNR.UFINANCE3,500,000$37,663,5000.28173,500,000NewN/A13G8/18/20
SEINFORMATION TECHNOLOGY223,000$23,915,0000.1820223,000New0.05%13F6/30/20
ZMINFORMATION TECHNOLOGY80,000$20,283,0000.152180,000New0.03%13F6/30/20
SFIXCONSUMER DISCRETIONARY250,000$6,235,0000.0525250,000New0.24%13F6/30/20

Here’s how Altimeter Capital describes its Analysis Methods in the fund’s ADV part II filed with the SEC.

In managing the Hedge Fund, Altimeter’s objective is to maximize compounded annual long-term net returns for the Hedge Fund investors. Altimeter takes a deep fundamental approach to security analysis. Each investment position stands on its own based on Altimeter’s assessment of whether a significant discrepancy exists between a company’s current market value and intrinsic business value. Altimeter intends to invest Hedge Fund assets in sectors and companies in which Altimeter believes it has differentiated expertise and understanding.

Disclaimer:

This investment blog (the “Blog”) is created and authored by Mark W. Gaffney (the “Content Creator”). The Blog is provided for informational and entertainment purposes only (collectively, the “Blog Service”). The information in the Blog constitutes the Content Creator’s own opinions. None of the information contained in the Blog constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. You understand that the Content Creator is not advising, and will not advise you personally concerning the nature, potential, value or suitability of any particular security, portfolio of securities, transaction, investment strategy or other matter. To the extent any of the information contained in the Blog may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person.

From time to time, the Content Creator or its affiliates may hold positions or other interests in securities mentioned in the Blog. The Content Creator or affiliates may trade for their own account(s) based on the information presented, and may also take positions inconsistent with the views expressed in its messages on the Blog.

The Content Creator may hold licenses with FINRA, the SEC or states securities authorities. These licenses may or may not be disclosed by the Content Creator in the Blog.

Investing in the investments discussed in the Blog may be risky and speculative. The companies may have limited operating histories, little available public information. The stocks discussed may be volatile and illiquid. Trading in such securities can result in immediate and substantial losses of the capital invested. You should only invest risk capital not required for other purposes, such as retirement savings, student loans, mortgages or education.

Full Disclaimer.