David Abrams’ Abrams Money Management Portfolio Tracker: Q3 2022 Update

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This article is part of a series that provides ongoing analysis of the changes made to the David Abrams 13F portfolio on a quarterly basis. It is based on the Abrams regulation. Form 13F filed on 11/10/2022. Visit our David Abrams Abrams Money Management Tracker article for an insight into his investment philosophy and our last update for fund movements during the second quarter of 2022.

This quarter, the value of Abrams’ 13F portfolio decreased from $3.72 billion to $3.47 billion. The number of positions was stable at 18. The top three holdings are at ~36% of the 13F portfolio, while the top five positions are at ~53%.

Participation decreases:

Change medical care: Change Healthcare held a whopping 12.61% (top three) of the established portfolio position during the first three quarters of 2021 at prices between ~$18 and ~$24. UnitedHealth (UNH) acquired Change Healthcare in an all-cash deal for $25.75 per share that closed in October.

Note: Abrams Capital Management had a ~5.4% ownership interest in Change Healthcare.

Alphabet Inc. (GOOG): GOOG is a large position (top five) ~8% bought in Q2 2018 at prices between ~$50 and ~$59. There was a ~20% share increase in Q1 2020 at prices between ~$53 and ~$76. The stock is now at ~$97. There was a marginal drawdown this quarter.

LP energy transfer (ET): The ~7% ET share was established in the first quarter of 2020 at prices between $4.55 and $13.75. There was a ~64% share increase in Q3 2020 at prices between $5.40 and $7.15. The stock is now at $12.20. This quarter saw a marginal reduction.

Coupang Inc. (CPNG): CPNG’s 6.44% stake was purchased in Q3 2021 at prices between ~$27 and ~$44.50. The next quarter saw a ~120% share increase at prices between ~$25.50 and ~$30.50. This was followed by a ~40% share increase in Q1 2022 at prices between ~$15.50 and ~$28.75. The stock is now at $19.14.

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Teva Pharmaceuticals (TEVA): TEVA is a 5.56% holding of the portfolio established in the third quarter of 2017 at prices between $15.50 and $33.50. The third quarter of 2019 saw a one-third share increase at prices between $6 and $9.60. The stock is currently trading at $9.48. This quarter saw a marginal reduction.

Kinder Morgan (KMI): KMI is 1.62% of the portfolio position purchased in the first quarter of 2018 at prices between $14.75 and $19.75. The first quarter of 2020 saw a ~15% share increase at prices between $10 and $22.25 and that was followed by a ~27% increase the next quarter at prices between $12.73 and $18. There was a ~73% reduction this quarter at prices between ~$16 and ~$19. The stock is currently trading at $18.69.

USCB Financial Holdings (USCB): USCB is a minutely small portfolio position of 0.32% established in the third quarter of 2021. The holding saw a marginal reduction during the quarter.

Kept stable:

Lithia Motors (LAD): LAD is currently the largest position at ~15% of the portfolio. It settled in the second quarter of 2018 at prices between $95 and $105 and nearly doubled the next quarter at prices between $81 and $99. There have been minor increases since then. The stock is now at ~$240.

Note: His ownership interest in Lithia Motors is ~9%.

Asbury Automotive (ABG): ABG is one of the top three 9.23% positions established in Q3 2017 at prices between $50 and $62 and increased by ~45% in Q3 2018 at prices between $67 and $77.50. The next quarter saw another 20% share increase at prices between $59 and $72. The first quarter of 2020 also saw an ~11% share increase at a 40-year average cost. The stock is currently trading at ~$181.

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Note: Your ownership interest in the business is ~9%.

TransDigm Group (TDG): TDG’s 8.16% large (top five) position was purchased in Q1 2020 at prices between $246 and $658 and the shares are currently trading at ~$626.

AMERCO (UHAL): UHAL is a 6.21% position bought in Q4 2016 at prices between $31 and $37 and increased ~160% the following quarter at prices between $37 and $39. There was a ~45% increase in the second quarter of 2017 at prices between $34 and $39, followed by a similar increase in the first half of 2018 at prices between $32 and $38. Q4 2021 saw a ~20% reduction at prices between ~$65 and ~$76. The next quarter also saw a minor cut of ~6%. The stock is now at ~$53.

Note: Prices quoted above are adjusted for the 10-for-1 stock split earlier this week.

Willis Towers Watson plc (WTW): WTW is a large position of 5.56% bought in the first quarter of 2017 at prices between $117 and $133. Since then, activity has been less. The stock is now at ~$234.

Meta Platforms (META) formerly Facebook: META is a 4.71% portfolio position purchased in Q4 2018 at prices between $124 and $163. The first quarter of 2020 saw a share increase of ~18% at prices between $146 and $223. The stock is currently trading at ~$113.

Camping World Holdings (CWH): CWH is a 3.73% position bought in the third quarter of 2018 at prices between $19 and $27 and increased by two-thirds the next quarter at prices between $11.25 and $22.50. The second quarter of 2019 saw a ~30% share increase at prices between $11 and $13 per share. Q4 2019 also saw a ~12% share increase to ~$7.90 per share, while Q3 2020 saw a similar sale at ~$37.50. The stock is now at $28.93. They control ~12% of the business.

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OI Glass (OI) formerly Owens-Illinois: OI is a 2.59% share of the portfolio established in Q4 2019 at prices between $8.50 and $12 and increased by ~42% next quarter at prices between $4.64 and $15. The stock is currently trading at $16.31.

Tempur Sealy International (TPX): TPX is a 2.51% holding of the portfolio set in Q3 2021 at prices between ~$37.50 and ~$49.60 and the stock is currently trading well below that range at $32.53.

Cantaloupe Inc. (CTLP) formerly USA Technologies: The very small CTLP position of 0.31% was bought in Q1 2021 at prices between ~$9.45 and ~$12.45 and is now well below that range at $3.23. The first quarter of 2022 saw a ~50% share increase at prices between ~$6.50 and ~$8.75.

Nuvation Bio (NUVB): Panacea Acquisition merged with Nuvation Bio in a de-SPAC transaction that closed in February 2021. The holding was established during that quarter when it was trading between ~$9 and ~$14.60. It is currently trading at ~$2, and the holding is 0.25% of the portfolio.

The following spreadsheet highlights the changes in Abrams’ 13F share holdings in the third quarter of 2022:

David Abrams - Abrams Capital Management Q3 2022 13F Report Q/Q Comparison

David Abrams – Abrams Capital Management Q3 2022 13F Report Q/Q Comparison (John Vincent (Author))

Source: John Vincent. Data compiled from Abrams Capital Management’s 13F filings for Q2 2022 and Q3 2022.

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