Einhorn’s Greenlight Sells Apple Shares, Buys Time Stake

Aug 14, 2014 6:54 pm ET

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Aug. 14 (Bloomberg) -- Greenlight Capital Inc., the hedge- fund firm run by David Einhorn, trimmed holdings in Apple Inc. and bought a new stake in Time Inc. during the second quarter.

Einhorn, who pressured Apple executives to use more of the company’s cash to reward investors, sold 4.5 million shares of the maker of iPhones and iPads, according to a filing with the U.S. Securities and Exchange Commission today. The stock, still Greenlight’s second-biggest holding, rallied 21 percent during the second quarter as Apple spent $18 billion buying its own shares.

Greenlight also cut its ownership in Micron Technology Inc., by 3.7 million shares. The memory chip manufacturer remains its largest holding, with a stake valued at $1.3 billion as of June 30. While Micron jumped 39 percent during the second quarter for the best performance in the Nasdaq 100 Index, the shares have fallen more than 10 percent from a 12-year high on July 16.

Jonathan Gasthalter, a Greenlight Capital spokesman at Sard Verbinnen & Co., declined to comment.

In May, Einhorn said he was bullish on the technology industry and that companies including Apple looked underpriced, refining his stance after warning of a bubble in technology stocks two weeks prior.

Earlier this month, Einhorn said he was struggling to find value amid a five-year stock market rally. The Standard & Poor’s 500 Index has almost tripled from its 2009 low, limiting options to buy stocks at attractive prices.

‘Difficult Time’

“We had a difficult time finding new investments this quarter,” he said on a conference call discussing results at Greenlight Capital Re Ltd., the Cayman Islands-based reinsurer where he is chairman. “As the market continues to rise in the face of conflicting economic data, global unrest, and looming overdue Fed exit from quantitative easing we remain cautiously positioned.”

Greenlight also took a new stake during the quarter in Time, the largest publicly traded magazine company. The hedge fund now owns 3.35 million shares, a holding worth $81.1 million, of the company, according to the SEC filing. Shares of New York-based Time have risen 12 percent since May 21, when the company that was spun off by Time Warner Inc. started trading.

Einhorn is best known for betting on a decline in Lehman Brothers Holdings Inc. before the bank collapsed in 2008. His strategy is to bet both on gains and drops in stocks.