All investor eyes are on the shares of Apple after Steve Jobs’s announcement that he is stepping down as CEO of the computer and consumer electronics giant he co-founded. The 56-year-old Jobs, of course, is the visionary behind Apple’s enormously successful iPod, iPhone and iPad franchises, and investors are understandably concerned about how the company will fare without him.
One group with a keen interest in how the stock reacts to Jobs’s departure is hedge funds. Although Apple did not rank among the 15 stocks most overweighted by hedge funds at the end of the second quarter, according to an analysis by Credit Suisse Securities, it is perhaps the most widely held stock among these investors.
According to one estimate, more than 300 hedge funds have some sort of position in the shares. More than two dozen high-profile hedge funds alone count Apple as their No. 1 holding, including a large number of so-called Tiger Cubs and related felines.
Among them: Julian Robertson Jr.’s Tiger Management Corp. itself, as well as Stephen Mandel Jr.’s Lone Pine Capital, his buddy John Griffin’s Blue Ridge Capital, Lee Ainslie’s Maverick Capital, Robert Citrone’s Discovery Capital Management, Philippe Laffont’s Coatue Management and Patrick McCormack’s Tiger Consumer Management. In addition, Chase Coleman’s Tiger Global Management counted Apple as its second-largest holding.
Some of the biggest hedge funds without previous ties to Robertson and Tiger also singled out Apple as their top holding. They include James Simons’ Renaissance Technologies, Steven Cohen’s SAC Capital Advisors, Kenneth Griffin’s Citadel, David Shaw’s D.E. Shaw & Co., Mark Kingdon’s Kingdon Capital Management, Jeffrey Altman’s Owl Creek Asset Management and Jeffrey Vinik’s Vinik Asset Management.
In addition, David Einhorn’s Greenlight Capital cited Apple as its second-largest holding.
Although Apple is just one among many holdings for most of these hedge fund managers, don’t underestimate its potential impact. In July alone shares of Apple surged more than 16 percent thanks to astounding quarterly results reported during the month. (Einhorn said Greenlight’s strong July performance was led by Apple and gold.) Afterward several analysts raised their price targets on the stock. The stock, however, was down nearly 7 percent from its high before Jobs announced his resignation.
The big question is whether these savvy hedge fund managers keep their stakes intact, begin to trim their positions, dump the stock altogether or buy on likely dips. One thing is certain: Apple’s performance will have a major impact on the fortunes of many of the most successful hedge funds.
