Third Point slumps as growth firms drag investment titan down

Third Point posted a shaky set of results this morning as the investment giant rides out “countervailing forces”.

It said it generated a net asset value (NAV) return of -22.6 per cent during the half year, compared with a 20.3 per cent fall in the MSCI World Index and a 20.0% decline in the S&P 500 Index.

The company also returned a – 18.0 per cent share price performance.

In the first six months of 2022, 1.2 million shares were repurchased at a value of approximately $28.2 million, adding 12 cents per share to NAV.

The share price discount to NAV reduced noticeably from 14 per cent to 9 per cent, helped in part by accretive discount control management measures.

On this, Third Point, which is headed by notorious investor Daniel Loeb as its CEO, said that growth-oriented investments, such as cyberfirm SentinelOne and EV maker Rivian were top detractors for the first half of the year, while the likes of Shell and EQT, along with portfolio interest rate hedges, were the top contributors for the period.

Chair of the firm Rupert Dorey said: “Daniel Loeb and his team are known for their ability to pivot when market circumstances shift, and it certainly feels like regime change is in progress now that global economies are facing such countervailing forces.

While Third Point, as a more directional investment manager, is not immune from the initial fallout that accompanies these pivotal moments, it has a 27-year history of deploying capital thoughtfully in their aftermath.”

Loeb’s Third Point hedge fund bought a $1bn stake in the media giant in August, putting increasing pressure on Disney’s ongoing strategy.

In an interview with the Financial Times, Bob Chapek has resisted activist investor Dan Loeb’s ambitions to reduce Disney’s debtload by offloading the sports network.

“If everyone wants to come in and buy it . . . I think that says something about its potential,” Chapek said. “I think its potential is within the Disney company.”

The top exec said he was confident in Disney’s ability to restore growth at ESPN, a service best known for showing US live sports like National Football League and Major League Baseball.

Third Point shares are down 25 per cent in the year to date.

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