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This Stock Is Driving Dan Loeb’s Third Point

The multistrategy hedge fund’s equity strategy led the way last month, kicking in 5.2 percent to net returns.

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Illustration by II

Third Point posted a strong 5.6 percent gain in May, more than doubling its performance for the year. As a result, the hedge fund headed by Dan Loeb is up 10.5 percent over the first five months of 2024, according to its May monthly report, seen by Institutional Investor. For comparison, the S&P 500 rose 5 percent in May and 11.3 percent for the year, including dividends reinvested.

The multistrategy hedge fund’s equity strategy led the way last month, kicking in 5.2 percent to net returns. The long book accounted for a 6.9 percent increase, but the short book detracted from performance by 1.7 percent. Most of the gains were generated by the fundamental and event-driven book.

Most of Third Point’s non-equity strategies also were profitable or broke even, led by credit, which added 0.30 percent to May performance. Equities also accounted for most of the year-to-date gains.

Third Point’s biggest winner this year is energy company Vistra Corp., which led in May as well as year-to-date. The stock was up about 30 percent last month alone and approximately 157 percent this year through May. This, stunningly, is even better than Nvidia’s performance over the same five-month period. On March 1, Vistra completed the acquisition of Energy Harbor, boosting its retail electricity business.

Third Point’s other top performers in May were utility Pacific Gas and Electric, consumer goods company Bath & Body Works, investment bank UBS, and cloud computing giant Microsoft. Other winners for the year so far are e-commerce giant Amazon, Microsoft, Bath & Body Works, and Facebook parent Meta Platforms. Third Point expanded its stake in Amazon by more than 21 percent in the first quarter, according to the most recent 13F filing.

The firm’s biggest losers in May were Corpay, a business payments and spend management company, and four different undisclosed short positions. For the year, the biggest losers were chemicals giant DuPont, health care insurance giant Humana, chip company Marvell Technology, and two different undisclosed short positions. Third Point fully liquidated its stake in DuPont in the first quarter, according to a regulatory filing.

Heading into June, Third Point turned even more bullish, boosting net long exposure in its equities strategy to nearly 87 percent from 77 percent in April. Virtually all of the difference is thanks to an increase in the firm’s long exposure. Its five biggest long positions are unchanged from April: PG&E, Amazon, Microsoft, Bath & Body Works, and Meta.

In the first quarter, Third Point also established a new, three million–share position in Google parent Alphabet, making it the firm’s seventh-largest U.S. common stock long position, per a regulatory filing.