In this article, we will be taking a look at some of the top stocks in the portfolio of billionaire Chris Rokos. To skip our analysis of Chris Rokos’s profile, investment strategy, and 13F holdings, you can go directly to see the 5 Best Stocks to Buy Now According to Billionaire Chris Rokos.
Christopher Rokos, the CEO & founder of Rokos Capital Management, has a net worth of $1.5 billion as of September 2022, according to Forbes. Rokos is a macro investor who deals in commodities, currencies, interest rates, and equities. Rokos established his London-based firm Rokos Capital Management in 2015, which currently manages about $12 billion and has more than 200 employees. Rokos, a founding partner of Brevan Howard Asset Management, parted ways with his colleague Alan Howard after a disagreement. He was one of the most vocal participants in Brevan’s morning investment meetings. A January report from Financial Times cited an individual acquainted with his thinking, who said Rokos promoted a strict approach to fund management, claiming that unsuccessful traders should be promptly removed and that the first year of a trader’s employment should be treated as a job interview. According to the report, Rokos is one of the world’s most adept managers at managing very sizable debt and option holdings. The FT source said: “When he gets it right, he gets it really, really right”.
Rokos Capital’s Portfolio
Rokos Capital Management LLP manages $138.426 billion in discretionary assets. Their most recent 13F filing for Q2 2022 showed managed 13F securities valued at $3.413 billion with a top 10 holdings concentration of 60.71%. With 1.597 million shares held, Invesco QQQ Trust, Series 1 is the largest holding of Rokos Capital Management LLP. During Q2, 2022, the fund made a portfolio rebalance by selling 26 stocks and acquiring 30 new stocks. The fund also decreased its holdings in 11 equities while increasing its purchases in 16 of them. The information technology sector comprises 32.86% of the fund’s 13F portfolio.
Photo by Chris Liverani on Unsplash
Our Methodology
Below is a list of the 10 best stocks to buy according to billionaire Chris Rokos. The equities were chosen from the hedge fund’s second-quarter regulatory filings. To help our readers assess each stock’s appeal to seasoned hedge funds, we’ve supplied hedge fund sentiment using Insider Monkey’s database of 895 elite hedge funds.
These are the top ten stock picks from Rokos’s latest portfolio.
Best Stocks to Buy Now According to Billionaire Chris Rokos
10. salesforce.com, inc. (NYSE:CRM)
Rokos Capital Management’s Stake Value: $30.797 million
Rokos Capital Management’s 13F Portfolio: 0.9%
Number of Hedge Fund Holders: 116
On September 2, Salesforce, Inc. (NYSE:CRM) was upgraded by Guggenheim analyst John DiFucci from Sell to Neutral with a $150 price target, saying that the company has been down 20% since he started following it on August 11, while the S&P 500 has fallen 7% during that time.
In its Q1 2022 investor letter, Vulcan Value Partners mentioned Salesforce, Inc. (NYSE:CRM) and explained its insights for the company. Here is what the fund said:
“Salesforce.com Inc. is the dominant provider of customer relationship management software and technology. Salesforce has high retention rates, pricing power, high free cash flow, and a competitive moat. The company continues to execute well. Margins decreased slightly during the fourth quarter but continue to be on path for material expansion over the long term. Salesforce is seeing increased spending as employees are returning to the office, and we believe the global pandemic has only improved its prospects.”
09. ASML Holding N.V. (NASDAQ:ASML)
Rokos Capital Management’s Stake Value: $34.453 million
Rokos Capital Management’s 13F Portfolio: 1%
Number of Hedge Fund Holders: 47
ASML Holding N.V. (NASDAQ:ASML) was established in 1984 and has its headquarters located in Veldhoven, the Netherlands. For memory and logic chip manufacturers, ASML Holding N.V. develops, produces, promotes, sells, and services sophisticated semiconductor equipment solutions that include lithography, metrology, and inspection-related systems. Rokos Capital Management started investing in ASML during the previous quarter. It currently holds 72,783 shares of ASML worth roughly $34.453 million.
ASML Holding N.V. (NASDAQ:ASML) is one of the most competitive manufacturers of machinery and equipment for the semiconductor industry. The business is a market leader in photolithography equipment used to imprint circuitry layouts onto silicon wafers. ASML Holding N.V. (NASDAQ:ASML) has maintained a net profit margin of about 30% while growing revenues at a rate greater than 20% CAGR throughout the recent years. However, as the focus moved from growth to value, ASML is down more than 40% year to date.
Francois-Xavier Bouvignies, an analyst with UBS, is bullish on ASML. On August 31, the analyst raised his rating from Neutral to Buy and price target from EUR 630 to EUR 665 for ASML, respectively. In the current unsteady macro climate, ASML is one of the “most desirable names,” according to Bouvignies’ research letter to investors. Given the company’s great visibility and pricing power, the analyst thinks there is little room for the shares to fall.
08. Denbury Resources Inc. (NYSE:DEN)
Rokos Capital Management’s Stake Value: $35.619 million
Rokos Capital Management’s 13F Portfolio: 1.04%
Number of Hedge Fund Holders: 31
Founded in 2003, Denbury Resources Inc. (NYSE:DEN) has its corporate headquarters in Plano, Texas. Being an independent energy business, Denbury Inc. specializes in oil production from established oil fields in the Gulf Coast and Rocky Mountain regions.
According to the latest quarter’s earnings report released on August 4, Denbury Resources Inc. (NYSE:DEN) reported an EPS GAAP actual of $2.83 and revenue of $482.16 million, both above the market consensus. Considering the company’s Q2 earnings release “somewhat favorable,” Stifel analyst Michael Scialla increased his price target on Denbury Resources Inc. (NYSE:DEN) to $132 from $126 and maintained a Buy rating on the shares. Scialla informs investors that although he expects the capex projection increase to fully offset the Q2 beat and the favorable return of capital, he expects the stock to continue to rise if the Inflation Reduction Act is passed.
07. Alphabet Inc. (NASDAQ:GOOG)
Rokos Capital Management’s Stake Value: $39.582 million
Rokos Capital Management’s 13F Portfolio: 1.15%
Number of Hedge Fund Holders: 153
During Q2, Rokos Capital Management reduced its stake in Alphabet Inc. (NASDAQ:GOOG) by 21%, holding 18,127 of its shares, worth roughly $39.582 million. Google’s main advertising business gained just 11.6% year over year during the three months ended June 30, in contrast to the roughly 69% growth it reported during the same period last year. In July of this year, Alphabet Inc. (NASDAQ:GOOG) published its financial results for the second quarter of 2022. For the three months ending June 30, 2022, its sales climbed by 13% year over year to reach $69.7 billion, but its net income fell by 16% year over year to $16 billion. It announced EPS of $1.21, $0.08 below the expectations.
In an uncertain economic climate made worse by a slowdown in ad expenditure, Alphabet and Google CEO Sundar Pichai is hinting at potential job cuts.
In its Q2 2022 investor letter, Baron Durable Advantage Fund mentioned Alphabet Inc. (NASDAQ:GOOG) and explained its insights for the company. Here is what the fund said:
“Alphabet Inc. is the parent company of Google, the world’s largest search and online advertising company. Shares of Alphabet declined 21.6% in the quarter due to concerns about slower global growth impacting the company’s core advertising business. We retain conviction in Alphabet’s merits as it continues to benefit from growth in mobile and online video advertising, which accrues to its core assets of search, YouTube, and the Google ad network. We are further encouraged by Alphabet’s investments in Cloud, AI, and Autonomous Driving (through its Waymo subsidiary).”
06. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Rokos Capital Management’s Stake Value: $41.068 million
Rokos Capital Management’s 13F Portfolio: 1.2%
Number of Hedge Fund Holders: 87
Advanced Micro Devices, Inc. operates as a semiconductor company worldwide. Advanced Micro Devices, Inc. (NASDAQ:AMD) was incorporated in 1969 and is headquartered in Santa Clara, California. Although Advanced Micro Devices, Inc. (NASDAQ:AMD)’s Q2 2022 earnings and FY 2022 forecast were satisfactory, its recent share price performance has been negatively impacted by the sluggish semiconductor industry conditions. In July 2022, global semiconductor sales dropped by 2.3% MoM. Hedge funds are still bullish on Advanced Micro Devices, Inc. (NASDAQ:AMD), as it has just touched the peak of its popularity during Q2 among the hedge funds tracked by Insider Monkey. A total of 87 hedge funds are holding a stake in Advanced Micro Devices, Inc. (NASDAQ:AMD) as compared to 83 in the previous quarter.
On September 7, with a Buy rating and a $122 price target, Stifel analyst Ruben Roy began covering Advanced Micro Devices, Inc. (NASDAQ:AMD), praising its “strong product roadmap” and ongoing advantage against Intel (INTC). According to Roy, the current value “appears acceptable,” especially in comparison to other product cycle businesses like Nvidia (NVDA).
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Disclosure: None. 10 Best Stocks to Buy Now According to Billionaire Chris Rokos is originally published on Insider Monkey.