In this article, we discuss the 10 stocks Stanley Druckenmiller is selling. If you want to skip our detailed analysis of Druckenmiller’s history, investment philosophy, and hedge fund performance, go directly to the 5 Stocks Stanley Druckenmiller is Selling.
Stanley Druckenmiller, the chief of New York-based hedge fund Duquesne Capital, is one of the most renowned names on Wall Street with a personal net worth of over $5.5 billion and a portfolio value of more than $3 billion. Most of his investments are concentrated in the technology and services sector of the economy, with basic materials, finance and healthcare comprising the rest of his holdings. In 2010, when Druckenmiller announced he would be closing Duquesne Capital to new investors, he had never had a losing year in three decades.
Despite not accepting new investors, the billionaire still issues regulatory filings publicly. According to these filings, some of the top holdings in the Duquesne Capital portfolio at the end of the first quarter of 2021 were Amazon.com, Inc. (NASDAQ: AMZN), Microsoft Corporation (NASDAQ: MSFT), and PayPal Holdings, Inc. (NASDAQ: PYPL), among others. Together, these represent close to 20% of the entire investment portfolio of Duquesne Capital, with Microsoft Corporation (NASDAQ: MSFT) occupying the top position.
Druckenmiller became famous after he helped George Soros, the chief of Soros Fund Management, short the British pound in 1992, making the hedge fund more than $1 billion in the process. While working closely with Soros for most of his finance career, Druckenmiller developed expertise in currencies and interest rates. This has helped him achieve success with Duquesne Capital. During the financial crisis of 2009, his fund was one of the few that posted positive returns, although it failed to match the record returns posted in the preceding years.
Druckenmiller, along with Soros, has over the years perfected the art of macro trading. This involves blending two types of investment strategies into one. One is betting on global currencies, keeping in mind political trends, and the other is conventional stock trading through research on basic business fundamentals. The success of Druckenmiller is an exception in the industry that is reeling from the rise of fintech and a dramatic shift in market dynamics spurred by retail traders that actively spoil hedge fund bets.
The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
Stan Druckenmiller
With this context in mind, here is our list of the 10 stocks Stanley Druckenmiller is selling. These were ranked keeping in mind the investment portfolio of Duquesne Capital at the end of the first quarter of 2021. Druckenmiller’s fund sold off their entire stakes in these companies during the first three months of the year.
Stocks Stanley Druckenmiller is Selling
10. Hess Corporation (NYSE: HES)
Number of Hedge Fund Holders: 26
Hess Corporation (NYSE: HES) is placed tenth on our list of 10 stocks Stanley Druckenmiller is selling. The stock has returned 85% to investors in the past year. The company explores, develops, and produces oil, gas, and other fossil fuels. Duquesne Capital has sold-off stake in the firm over the past few months and at the end of March, did not own any shares in the company.
Hess Corporation (NYSE: HES) on June 11 declared a quarterly dividend of $0.25 per share, in line with previous.
Out of the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Hess Corporation (NYSE: HES) with 3.3 million shares worth more than $235 million.
Unlike Amazon.com, Inc. (NASDAQ: AMZN), Microsoft Corporation (NASDAQ: MSFT), and PayPal Holdings, Inc. (NASDAQ: PYPL), Hess Corporation (NYSE: HES) is one of the stocks Stanley Druckenmiller is selling.
In its Q2 2020 investor letter, Massif Capital, an asset management firm, highlighted a few stocks and Hess Corporation (NYSE: HES) was one of them. Here is what the fund said:
“We took a short position in Hess (HES) during the first quarter due to what we believed to be a weakness in their assertion that the Bakken would serve as a cash engine, along with their Gulf of Mexico assets, to pay for the development of their offshore Guyana fields. Our analysis suggested that not only was their fracking in the Bakken unprofitable but that it was unlikely ever to be so. The market very quickly told us that although we might be right in our analysis of the fundamentals, it did not care. We suspect that much of this has to do with the fact that Hess had hedged nearly 100% of their production in 2020 during the relatively high priced 2019 period, but we cannot be certain. Since we closed out the position, the stock has rallied a further 45%. We take this as directional evidence (perhaps) of a good decision. Hess contributed -0.19% to the portfolio during the quarter.
We have mostly avoided shorting oil companies in the last few years. The opportunity is appealing but extremely tricky to evaluate. Hess remains an interesting short. We have little confidence in the long-term viability of operations in the Bakken, and Hess remains a large player. Yet as the firm moves further along in their development and monetization of assets in Guyana, the weight of the Bakkens failure to play a meaningful role in producing positive free cash flow becomes increasingly difficult to determine by looking at the financials and perhaps less significant to the market. One thing that seems increasingly true of the environment we are investing in is that bad capital allocation by management teams can be easily forgiven if there is plenty of liquidity, even if access to liquid capital imperils long-term solvency.”
9. Live Nation Entertainment, Inc. (NYSE: LYV)
Number of Hedge Fund Holders: 37
Live Nation Entertainment, Inc. (NYSE: LYV) is an entertainment company that promotes and sells tickets for different live events worldwide. It is ranked ninth on our list of 10 stocks Stanley Druckenmiller is selling. The company’s shares have returned 83% to investors in the past twelve months. Druckenmiller has sold off the entire Duquesne stake in the firm over the past few months.
On May 14, investment advisory Wolfe initiated coverage on Live Nation Entertainment, Inc. (NYSE: LYV) stock with an Outperform rating and a year-end price target of $97, implying 13% upside potential for the stock that is soaring as the economy reopens and public events resume.
Out of the hedge funds being tracked by Insider Monkey, Virginia-based investment firm Akre Capital Management is a leading shareholder in Live Nation Entertainment, Inc. (NYSE: LYV) with 5.4 million shares worth more than $462 million.
Unlike Amazon.com, Inc. (NASDAQ: AMZN), Microsoft Corporation (NASDAQ: MSFT), and PayPal Holdings, Inc. (NASDAQ: PYPL), Live Nation Entertainment, Inc. (NYSE: LYV) is one of the stocks Stanley Druckenmiller is selling.
In its Q4 2020 investor letter, Oakmark Funds, an asset management firm, highlighted a few stocks and Live Nation Entertainment, Inc. (NYSE: LYV) was one of them. Here is what the fund said:
“In 2006, we initiated our position in Live Nation, the global entertainment company that handles promotion, venue management and ticket sales for live events. Live Nation was spun out of the former Clear Channel Communications in late 2005. In our view, spinoffs often represent attractive opportunities because investors frequently undervalue the new company. We believed this was the case with Live Nation, especially given its initially small market capitalization. As well, when spinoffs are freed from their parents, they typically benefit from intensified management focus and more flexible capital allocation policies. In Live Nation’s case, the spinoff helped make possible the merger with Ticketmaster in 2010, which materially improved the business franchise. Although these factors alone might have made Live Nation a good holding for the Fund, an unexpected technology helped to boost the company’s fortunes: streaming. As the advantages of streaming convinced consumers to reduce or even eliminate their purchases of media, such as CDs and DVDs, artists began to tour more, thereby providing a tailwind to Live Nation’s operations. This accelerated growth in the company’s intrinsic value per share, which in turn generated numerous increases in our sell target for the holding, enabling us to continue to own the shares in the Fund for 14 years. We typically target a three- to five-year holding period for our equity investments, but we love opportunities like Live Nation, which achieve unanticipated intrinsic value growth.”
8. BioMarin Pharmaceutical Inc. (NASDAQ: BMRN)
Number of Hedge Fund Holders: 43
BioMarin Pharmaceutical Inc. (NASDAQ: BMRN) stock has returned 8% to investors over the past three months. It is a biotechnology company that develops therapies for rare diseases. It is placed eighth on our list of 10 stocks Stanley Druckenmiller is selling. Duquesne Capital no longer holds any stake in the firm, according to the latest filings.
On April 29, BioMarin Pharmaceutical Inc. (NASDAQ: BMRN) posted earnings for the first quarter of 2021, reporting earnings per share of $0.09, beating market predictions by $0.19. The revenue over the period was $486 million, down 3% year-on-year.
At the end of the first quarter of 2021, 43 hedge funds in the database of Insider Monkey held stakes worth $1.2 billion in BioMarin Pharmaceutical Inc. (NASDAQ: BMRN), down from 51 the preceding quarter worth $1.6 billion.
Unlike Amazon.com, Inc. (NASDAQ: AMZN), Microsoft Corporation (NASDAQ: MSFT), and PayPal Holdings, Inc. (NASDAQ: PYPL), BioMarin Pharmaceutical Inc. (NASDAQ: BMRN) is one of the stocks Stanley Druckenmiller is selling.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and BioMarin Pharmaceutical Inc. (NASDAQ: BMRN) was one of them. Here is what the fund said:
“The Strategy closed out of five positions (including BioMarin). We sold BioMarin Pharmaceutical after a number of its clinical catalysts had played out.”
7. Carnival Corporation & plc (NYSE: CCL)
Number of Hedge Fund Holders: 44
Carnival Corporation & plc (NYSE: CCL) is ranked seventh on our list of 10 stocks Stanley Druckenmiller is selling. The company’s shares have offered investors returns exceeding 58% over the course of the past year. It is a Miami-based leisure travel firm. At the end of March, Druckenmiller had sold off his entire stake in the firm.
On July 4, Carnival Corporation & plc (NYSE: CCL) celebrated a major milestone as The Carnival Vista, one of the cruise offerings of the firm, set sail from a Texas port. This is the first cruise of the firm to set sail in almost a year and a half.
At the end of the first quarter of 2021, 44 hedge funds in the database of Insider Monkey held stakes worth $593 million in Carnival Corporation & plc (NYSE: CCL) , down from 47 in the previous quarter worth $1.1 billion.
Unlike Amazon.com, Inc. (NASDAQ: AMZN), Microsoft Corporation (NASDAQ: MSFT), and PayPal Holdings, Inc. (NASDAQ: PYPL), Carnival Corporation & plc (NYSE: CCL) is one of the stocks Stanley Druckenmiller is selling.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Carnival Corporation & plc (NYSE: CCL) was one of them. Here is what the fund said:
“Several of our better performers in the first quarter were purchased while their business models were under stress from COVID restrictions or the macro environment the pandemic created. What gave us confidence in purchasing Carnival was the actions the company took to extend out their balance sheets until travel resumed. Both should benefit as a broader vaccination rollout prompts cruise lines to resume operations and consumers to start traveling again and are positioned to deliver better margins and gain pricing power as the economy normalizes due to the cost controls implemented during the downturn.”
6. Analog Devices, Inc. (NASDAQ: ADI)
Number of Hedge Fund Holders: 50
Analog Devices, Inc. (NASDAQ: ADI) is a company that makes and sells integrated circuits, software, and subsystems. It is placed sixth on our list of 10 stocks Stanley Druckenmiller is selling. The stock has offered investors returns exceeding 41% over the course of the past twelve months. Duquesne no longer owns any shares in the firm.
On June 24, investment advisory Needham initiated coverage on Analog Devices, Inc. (NASDAQ: ADI) stock with a Buy rating and a price target of $195, noting the margins of the company that were the best in the industry.
At the end of the first quarter of 2021, 50 hedge funds in the database of Insider Monkey held stakes worth $4.8 billion in Analog Devices, Inc. (NASDAQ: ADI), down from 58 the preceding quarter worth $5.3 billion.
Unlike Amazon.com, Inc. (NASDAQ: AMZN), Microsoft Corporation (NASDAQ: MSFT), and PayPal Holdings, Inc. (NASDAQ: PYPL), Analog Devices, Inc. (NASDAQ: ADI) is one of the stocks Stanley Druckenmiller is selling.
In its Q4 2020 investor letter, Weitz Investment Management, an asset management firm, highlighted a few stocks and Analog Devices, Inc. (NASDAQ: ADI) was one of them. Here is what the fund said:
”Analog Devices benefited from several global, long-wave trends such as automation, electric vehicles and the 5G network build-out. The company’s quarterly sales into the auto, industrial and communications sectors exceeded expectations, giving the stock a lift.”
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Disclose. None. 10 Stocks Stanley Druckenmiller is Selling is originally published on Insider Monkey.
