Tracking John Armitage’s Egerton Capital Portfolio – Q4 2017 Update

• John Armitage’s 13F portfolio value increased from $11.18B to $11.42B this quarter.
• Egerton Capital added Alphabet, United Health, and Salesforce.com during the quarter. 
• Applied Materials, Charter Communications, and Activision Blizzard are the largest three positions in the portfolio.

John Arimitage’s 13F portfolio value increased ~2% this quarter from $11.18B to $11.42B. The portfolio is very concentrated with recent 13Fs listing around 30 positions. The largest five individual stock positions are Applied Materials, Charter Communications, Activision Blizzard, Praxair, and Constellation Brands and they add up to ~30% of the entire portfolio.

Below is a summary:

Bank of America (BAC): BAC is a fairly large ~4% position established in Q4 2016 at prices between $15.50 and $23 and the stock is now at $32.17. There was marginal increase this quarter.

Applied Materials (AMAT): The ~7% AMAT stake is the largest position. It was established in Q1 2017 at prices between $32 and $40 and increased by ~18% the following quarter at prices between $37.50 and $47.50. There was another ~23% increase last quarter at prices between $41 and $52. The stock currently trades at $59.44. This quarter saw a ~8% trimming.

Alphabet Inc. (GOOG): GOOG is back in the portfolio after a quarter’s gap. The fairly large ~4% stake was established at prices between $968 and $1077 and the stock currently trades at $1136.

Note: Alphabet Inc. has seen several roundtrips in the portfolio going back to 2011.

Activision Blizzard (ATVI): is a top-three position at 6.13% of the portfolio. The original position was built up in 2015 at prices between $19 and $39. Q1 2016 saw a one-third reduction at prices between $28 and $39 while the following quarter saw the exact reverse: one-third increase at prices between $33.50 and $39.50. Q4 2016 saw a two-thirds reduction at prices between $35.50 and $45.50. The pattern reversed again in Q1 2017: 225% increase at prices between $37 and $50. The stock is now at $71.68. There was a ~19% selling in Q2 2017 and that was followed with a ~9% trimming last quarter. This quarter saw the pattern reverse: ~22% increase at prices between $58.50 and $67.

Constellation Brands (STZ): STZ is a 5.21% portfolio stake established in Q2 2016 at prices between $138 and $165 and increased by ~20% the following quarter at prices between $161 and $171. The stock is now at $229. There were ~10% increases in the last three quarters while this quarter saw a ~15% reduction.

MasterCard (MA): MA was first purchased in Q2 2014 at prices between $69 and $78. The position has wavered since. Last three quarters of 2016 had seen the stake more than doubled at prices between $87 and $107. There was a ~40% reduction in Q1 2017 at prices between $105 and $113. The pattern reversed in Q2 2017: ~60% stake increase at prices between $111 and $126. The stock currently trades at $183. There was a ~40% selling this quarter at prices between $140 and $155.

Below is a spreadsheet that highlights the changes to John Armitage's Egerton Capital US long stock portfolio as of Q4 2017. For a look at how the portfolio has progressed, see our previous update:

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