10 Best Stocks to Buy According to Billionaire David Einhorn

8. Alight Inc. (NYSE:ALIT)

Greenlight Capital’s Stake Value: $87.66 Million

Number of Hedge Fund Holders: 40

Alight Inc. (NYSE:ALIT) is a technology company that provides cloud-based integrated digital human capital and business solutions. It offers employee well-being, integrated benefits administration, healthcare navigation, and optimization services for cloud platforms. The stock is down by about 16.05% for the year; its sentiments in the market hurt by lower volumes and reduced commercial activity. The winding down of the Hosted business operations has also weighed significantly on its operations.

Nevertheless, Alight Inc. (NYSE:ALIT) has moved to strengthen its long-term prospects through cloud migration transformation. Consequently, it is on course to receive $75 million in annualized savings as it focuses on technology-rich benefit services business. Expectations are high that Alight will return to robust growth and could see double-digit annual recurring revenue bookings growth.

In its third quarter, revenue was only down by 0.4% to $555 million, as recurring revenue accounted for 91% of the total revenue. On the other hand, contracted revenue was up by 9%. Gross profit increased to $174 million from $166 million delivered last year in the same quarter. However, net loss increased to $44 million from $40 million a year ago.

Alight Inc. (NYSE:ALIT) uses AI and machine learning to improve its business. Their AI engine, Alight LumenAI, enhances the Alight Worklife platform, making HR and financial tasks easier. This helps attract and keep clients by predicting patterns and spotting problems early. Alight is a leader in HR technology, benefiting from businesses wanting better employee experiences and streamlined HR processes.

Polen U.S. Small Company Growth Strategy stated the following regarding Alight, Inc. (NYSE:ALIT) in its Q3 2024 investor letter:

“We exited four positions during the quarter, including SiTime, AppFolio, RH, Doximity, and Alight, Inc. (NYSE:ALIT). Our position in Alight, a benefits outsourcing and business process-as-a-service company, was an unsuccessful investment. We decided to move on due to activist pressure that led to a breakup of the business. We were dissatisfied with both the plan and the new standalone business. This culminated with the CEO leaving and uncertainty over the company’s long-term strategic direction. As a result, we felt it was time to move on with better investment ideas in our pipeline.”