David Einhorn’s Greenlight Drops 15% In 1st Half 2018

&l;p&g;David Einhorn&l;span&g;&a;nbsp;&l;/span&g;ended June down 5.8% as some of his largest holdings slumped.

&l;img class=&q;dam-image bloomberg size-large wp-image-40770029&q; src=&q;https://specials-images.forbesimg.com/dam/imageserve/40770029/960×0.jpg?fit=scale&q; data-height=&q;640&q; data-width=&q;960&q;&g; David Einhorn, president of Greenlight Capital Inc., has battled against a market where his style of value investing has underperformed. Photographer: Christopher Goodney/Bloomberg

The June decline pushed the Greenlight Capital founder&a;rsquo;s portfolio to a 15.2% loss year to date, the lowest since his worst-ever year in 2015 when he saw returns dip 20.2%. Einhorn returned 1.5% in 2017 and 7.2% in 2016.

Greenlight has a portfolio of only 35 positions valued around $3.99 billion, not including short positions. One of the biggest weights on his returns is what he has called a &a;ldquo;bubble basket&a;rdquo; of short sales in high-flying tech stocks including Amazon, Netflix&a;nbsp;and Tesla.

The stocks are proving problematic once again for Einhorn this year as some rank among the best performers of the S&a;amp;P 500. Netflix has rocketed 107.4% year to date with the second-highest return of the index. Amazon has the 11th loftiest at 46.5%.

With the stocks trading at precariously lofty valuations, Einhorn&a;rsquo;s fortunes could turn around at some disturbance. Their price-earnings ratios are 262.1 for Netflix, the highest in the S&a;amp;P 500, and 213.1 for Amazon, the third highest.

Tesla has been friendlier to his short thesis, declining 3%. A short in Caterpillar, down 15%, also offered some mitigation.

Einhorn, one of the most respected figures in the industry, rose to fame by shorting the defunct Lehman Brothers during the financial crisis and has built a strong record spotting undervalued equities.

While he has not reported his second-quarter portfolio, he listed his largest positions as of June 30 in his returns report: Bayer, Brighthouse Financial, CNX Resources, General Motors, gold and Mylan. The following share figures were accurate as of the first quarter.

&l;strong&g;No. 1: Bayer AG&l;/strong&g;

Bayer shares have declined 7% year to date.

Bayer AG has a market cap of $82.26 billion; its shares were traded around 94.92 euros with a P/E ratio of 11.41 and P/S ratio of 2.17. The trailing 12-month dividend yield of Bayer AG stock is 2.90%. The forward dividend yield of Bayer AG is 2.90%. Bayer AG had an annual average earnings growth of 4.50% over the past 10 years. GuruFocus rated Bayer AG&l;span&g;&a;nbsp;&l;/span&g;the business predictability rank of 3-star.

&l;strong&g;No. 2: Brighthouse Financial Inc. at 11.04 million shares&l;/strong&g;

Shares of Brighthouse have declined 30% year to date.

Brighthouse Financial Inc. has a market cap of $4.86 billion; its shares were traded around $40.60 with and P/S ratio of 0.64.

&l;strong&g;No. 3: CNX Resources at 6,552,162 shares&l;/strong&g;

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Shares of CNX Resources have risen 16% year to date.

CNX Resources Corp. has a market cap of $3.82 billion; its shares were traded around $17.51 with a P/E ratio of 4.20 and P/S ratio of 4.22.

&l;strong&g;No. 4: General Motors Co. at 22,614,400 shares&l;/strong&g;

Shares of General Motors have declined 7% year to date.

&a;nbsp;

General Motors Co has a market cap of $54.93 billion; its shares were traded around $38.97 with a P/S ratio of 0.40. The trailing 12-month dividend yield of General Motors Co. is 3.91%. The forward dividend yield of General Motors Co. is 3.85%. General Motors Co. had an annual average earnings growth of 20.1% over the past five years.

&l;strong&g;No. 5: Gold&l;/strong&g;

The SPDR Gold Trust (GLD) has declined 5% year to date.

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&l;strong&g;No. 6: Mylan NV at 7,652,000 shares&l;/strong&g;

Shares of Mylan have declined 17% year to date.

&a;nbsp;

Mylan NV has a market cap of $18.54 billion; its shares were traded around $35.96 with a P/E ratio of 26.85 and P/S ratio of 1.60. Mylan NV had an annual average earnings growth of 7.3% over the past 10 years. GuruFocus rated Mylan NV&l;span&g;&a;nbsp;&l;/span&g;&l;a href=&q;http://www.gurufocus.com/predictable.php&q; target=&q;_blank&q;&g;the business predictability rank of 2.5-star&l;/a&g;.

This article first appeared &l;a href=&q;https://www.gurufocus.com/news/703693/david-einhorns-greenlight-drops-15-in-1st-half-2018&q; target=&q;_blank&q;&g;HERE&l;/a&g;.&l;/p&g;

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