In this article, we discuss 10 new stock picks of billionaire Stanley Druckenmiller. If you want to skip our detailed analysis of these stocks, go directly to 5 New Stock Picks of Billionaire Stanley Druckenmiller.
Policymakers in the United States have been charting a course of action over the past few months that is adequate enough to fight inflation without pushing the economy towards a recession. Stanley Druckenmiller, the chief of Duquesne Capital, has lauded the moves that the Fed has made in this regard. In a recent interview with news platform CNBC, the investor praised the decision of the central bank to drop forward guidance, noting that this would allow the market to “follow the data” and make the right decisions.
Druckenmiller also highlighted that as the Fed stopped buying treasury bonds and mortgage-backed securities, the bond market could act as a “useful economic signal” once again. Federal Reserve Chief Jerome Powell in January indicated that the central bank would end an asset-purchasing program in March and also hike interest rates. Druckenmiller has been warning of a market slowdown for months, last doing so in November 2021 while underlining that the “bubble” had creeped into many sectors of the market.
The latest moves of the famed investor shed more light on his overall economic outlook as the Fed prepares to raise interest rates. Some of the top stocks in the portfolio of Duquesne Capital at the end of December 2021 included Snap Inc. (NYSE:SNAP), Lockheed Martin Corporation (NYSE:LMT), and Sunrun Inc. (NASDAQ:RUN), among others discussed in detail below.
Our Methodology
These were picked from the investment portfolio of Duquesne Capital at the end of the fourth quarter of 2021. Only those companies that were new additions to the portfolio in the fourth quarter, compared to filings for the third, feature on the list.
Data from around 900 elite hedge funds tracked by Insider Monkey in the third quarter of 2021 was used to identify the number of hedge funds that hold stakes in each firm.
Stan Druckenmiller
New Stock Picks of Billionaire Stanley Druckenmiller
10. Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI)
Number of Hedge Fund Holders: 18
Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) owns and runs general merchandise stores. Latest filings show that Duquesne Capital opened a new position in the company during the fourth quarter of 2021, consisting of 158,200 shares worth more than $8 million, representing 0.29% of the total portfolio.
Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) also has the backing of other elite hedge funds. Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI), with 296,420 shares worth more than $15 million.
Just like Snap Inc. (NYSE:SNAP), Lockheed Martin Corporation (NYSE:LMT), and Sunrun Inc. (NASDAQ:RUN), Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) is one of the stocks that hedge funds are buying.
In its Q3 2021 investor letter, Harding Loevner, an asset management firm, highlighted a few stocks and Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) was one of them. Here is what the fund said:
“Ollie’s Bargain Outlet, a US-based discount retailer, detracted. The company reported a 21% year-over-year decline in revenue compared to a very strong quarter a year ago, when the first wave of US government stimulus checks led to a burst of consumer spending.”
9. TaskUs, Inc. (NASDAQ:TASK)
Number of Hedge Fund Holders: 18
TaskUs, Inc. (NASDAQ:TASK) is a Texas-based firm that provides outsourcing services. Top hedge funds hold large stakes in the company. At the end of the third quarter of 2021, 18 hedge funds in the database of Insider Monkey held stakes worth $230 million in TaskUs, Inc. (NASDAQ:TASK), compared to 20 in the previous quarter worth $77 million.
Regulatory filings show that TaskUs, Inc. (NASDAQ:TASK) was a new addition to the Duquesne portfolio between October and December 2021. The fund owns a stake in the firm consisting of 181,000 shares worth $9.7 million, representing 0.35% of the portfolio.
In its Q4 2021 investor letter, Alger, an asset management firm, highlighted a few stocks and TaskUs, Inc. (NASDAQ:TASK) was one of them. Here is what the fund said:
“TaskUs is a modern customer care company that manages digital customer experience exclusively for highly innovative “technology Disruptor” clients. The company’s services include managing end-consumers’’ needs for its clients, such as sales, after sales-support, complaint management, trust and safety and transaction processing. It also provides content security and operations services driven by artificial intelligence.
The stock underperformed in the final three months of 2021 despite the company providing a strong third quarter earnings report. We think the underperformance resulted from the company issuing 25% year-over-year earnings growth guidance for fiscal year 2022, which implies a meaningful deceleration. Additionally, an agreement preventing certain insiders from selling shares expires in the middle of January. The company’s shares, furthermore, have significant ownership by hedge funds, making them subject to year-end rebalancing. Despite the recent weakness, we think the fiscal year 2022 guidance is extremely conservative and the company is currently well positioned for future upward revisions to its earnings estimates.”
8. Compass, Inc. (NYSE:COMP)
Number of Hedge Fund Holders: 23
Compass, Inc. (NYSE:COMP) provides real estate brokerage services. Securities filings show that Druckenmiller bought a new stake in the company during the fourth quarter of 2021. This stake comprises 399,100 shares worth $3.6 million, representing 0.13% of the portfolio.
There is positive hedge fund sentiment around Compass, Inc. (NYSE:COMP). At the end of the third quarter of 2021, 25 hedge funds in the database of Insider Monkey held stakes worth $708.3 million in Compass, Inc. (NYSE:COMP), up from 23 in the previous quarter worth $708.4 million.
In its Q3 2021 investor letter, Artisan Partners, an asset management firm, highlighted a few stocks and Compass, Inc. (NYSE:COMP) was one of them. Here is what the fund said:
“We added several new GardenSM positions in Q3 including Compass. Compass is a real estate brokerage firm which provides its agents with a proprietary, end-to-end cloud-based platform. The company helps address the needs of buying and selling homes from client prospecting to closing, which includes customer relationship management, AI-driven prospecting, marketing (digital, social, email, video, print, signage, lead generation), market analysis and collaboration tools. The platform also uses machine learning, artificial intelligence and other advanced data analytics strategies to draw insights across the platform, allowing agents to be more efficient and informed in their selling efforts. We believe this technology advantage is key to the company continuing to disrupt and capture real estate commission market share. We have been impressed with the company’s ability to capture 4% market share since it was founded in 2012 (vs. Redfin, founded in 2002, holding a 1% market share). The company’s profit cycle can also be boosted by adding on additional services such as title insurance referral and escrow services, real estate marketing, home renovation referrals, home insurance and home warranty referrals—all of which we believe have a significantly larger addressable market than commissions (~7X).”
7. Guidewire Software, Inc. (NYSE:GWRE)
Number of Hedge Fund Holders: 26
Guidewire Software, Inc. (NYSE:GWRE) provides software products for the insurance industry. The company has many admirers in the finance world. Among the hedge funds being tracked by Insider Monkey, California-based investment firm Stockbridge Partners is a leading shareholder in Guidewire Software, Inc. (NYSE:GWRE), with 4.7 million shares worth more than $538 million.
Latest data reveals that Druckenmiller opened a new position in Guidewire Software, Inc. (NYSE:GWRE) between October and December 2021. The company had last featured in the Duquesne portfolio during the second quarter of 2020. The latest stake comprises 88,250 shares worth $10 million, representing 0.36% of the portfolio.
In its Q1 2021 investor letter, Wasatch Global Investors, an asset management firm, highlighted a few stocks and Guidewire Software, Inc. (NYSE:GWRE) was one of them. Here is what the fund said:
“Guidewire Software, Inc. (GWRE) was another large detractor. The company provides enterprise software for the property and casualty insurance industry. The software supports collaborative workflow, cooperation with external partners and rule-based decision making—all of which characterize modern underwriting and claims operations. Guidewire’s InsuranceSuite platform allows insurance-industry customers to manage claims, policies and billing functions. Other modules can be added to assist in data management, analytics and digital engagement. We believe Guidewire will eventually be well-positioned to benefit as insurance companies increasingly replace their core (usually on-premises) legacy software with centralized, cloud-based offerings. In the shortterm, however, Guidewire has seen some challenges with its move to the cloud. We think these challenges, along with the broad correction among technology names, accounted for the stock-price decline.”
6. Cazoo Group Ltd (NYSE:CZOO)
Number of Hedge Fund Holders: 32
Cazoo Group Ltd (NYSE:CZOO) operates as an online car retailer. The firm comprised just 0.03% of the Duquesne portfolio at the end of the fourth quarter of 2021. The stake consists of 140,100 shares worth $845,000.
Other hedge fund managers are also bullish on Cazoo Group Ltd (NYSE:CZOO). At the end of the third quarter of 2021, 32 hedge funds in the database of Insider Monkey held stakes worth $312 million in Cazoo Group Ltd (NYSE:CZOO).
In addition to Snap Inc. (NYSE:SNAP), Lockheed Martin Corporation (NYSE:LMT), and Sunrun Inc. (NASDAQ:RUN), Cazoo Group Ltd (NYSE:CZOO) is one of the stocks that institutional investors are flocking to.
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Disclosure. None. 10 New Stock Picks of Billionaire Stanley Druckenmiller is originally published on Insider Monkey.
