In this article, we discuss 10 stocks to buy according to Canyon Capital Advisors. If you want to skip our detailed analysis of Friedman and Julis’ history, investment philosophy, and hedge fund performance, go directly to 5 Stocks to Buy According to Canyon Capital Advisors.
Canyon Capital Advisors is a Dallas-based hedge fund founded in 1990 by Joshua S. Friedman and Mitchell R. Julis. It’s a risk-adjusted asset management fund that aims to outperform bond and stock market indices while lowering volatility. Canyon Capital Advisors invests in both debt and equity, including high-yield financing.
Canyon Capital Advisors has $19 billion in assets under management, and between 2002 and 2011, its flagship fund returned 10.4% annually, compared to 3.3% for the S&P 500 index. Special-purpose acquisition corporations, according to Friedman, exemplify the breakdown of market discipline. Therefore the hedge fund stocked up on investment-grade bonds and structured securities at considerable discounts during the early stages of the pandemic’s challenges. Canyon Capital Advisors was able to cut losses in its flagship fund by 4% in 2020 due to this strategy. In 2021, the $8.6 billion fund was up 9.3%.
In the fourth quarter of 2021, Canyon Capital Advisors 13F public stock portfolio was valued at $2.94 billion, with a top 10 holdings concentration of 42.95%. As of the end of the fourth quarter of 2021, some notable stocks of Canyon Capital Advisors portfolio include Dell Technologies Inc. (NYSE:DELL) and VMware, Inc. (NYSE:VMW).
Joshua Friedman of Canyon Capital Advisors
The hedge fund has a $128.29 million stake in Dell Technologies Inc. (NYSE:DELL). Canyon Capital Advisors’ bet on Dell Technologies Inc. (NYSE:DELL) is paying off. Dell Technologies Inc. (NYSE:DELL) shares are up 22.79% over the last 12 months as of March 27.
Another notable stock in Canyon Capital Advisors’ portfolio is VMware, Inc. (NYSE:VMW). On February 25, Barclays analyst Raimo Lenschow reduced his price objective on VMware, Inc. (NYSE:VMW) from $140 to $135 but maintained an Overweight rating on the shares. Lenschow told investors in a research report that the company had an outstanding performance but the Q1 and fiscal 2023 outlooks were below estimates.
Our Methodology
We used Canyon Capital Advisors’ 13F portfolio for Q4 2021 for this analysis. All hedge fund data comes from Insider Monkey’s distinct group of 900+ funds that filed 13Fs for the fourth quarter of 2021.
Stocks to Buy According to Canyon Capital Advisors
10. Boyd Gaming Corporation (NYSE:BYD)
Canyon Capital Advisors’ Stake Value: $89,595,000
Percentage of Canyon Capital Advisors’ 13F Portfolio: 3.04%
Number of Hedge Fund Holders: 34
Boyd Gaming Corporation (NYSE:BYD) is a gaming company that manages gaming and entertainment assets. Boyd Gaming (NYSE:BYD) declared a quarterly dividend of $0.15 per share on February 7. In December 2019, the firm issued its last dividend of $0.07.
Canyon Capital Advisors increased its stake in Boyd Gaming Corporation (NYSE:BYD) in the second quarter by 63%. Its stake in the company is worth about $89.60 million in the fourth quarter of 2021.
According to Insider Monkey’s third quarter database, 34 hedge funds were bullish on Boyd Gaming Corporation (NYSE:BYD), with stakes totaling $1.10 billion. HG Vora Capital Management holds the most significant stake in Boyd Gaming Corporation (NYSE:BYD) as of Q4 2021, with 4.10 million shares worth $268.84 million.
Just like Dell Technologies Inc. (NYSE:DELL) and VMware, Inc. (NYSE:VMW), Boyd Gaming Corporation (NYSE:BYD) is one of the stocks that hedge funds are buying.
Ariel Investments, an investment management firm, in its fourth quarter 2021 investor letter mentioned Boyd Gaming Corporation (NYSE:BYD). Here is what the fund said:
“We also added casino and entertainment operator, Boyd Gaming Corporation (BYD), which derives most of its revenue from high loyalty and repeat customer base. BYD also owns a minority position in online daily fantasy sportsbook FanDuel. Throughout the pandemic, the company focused on improving operations to permanently lower its expense structure. These initiatives have resulted in margin expansion, strong free cash flow, and accelerated debt repayments. While we expect margins to decline somewhat from currently elevated levels, we believe the market is underestimating the earnings power of the company.”
9. Ardagh Metal Packaging S.A. (NYSE:AMBP)
Canyon Capital Advisors’ Stake Value: $90,723,000
Percentage of Canyon Capital Advisors’ 13F Portfolio: 3.08%
Number of Hedge Fund Holders: 30
Ardagh Metal Packaging S.A. (NYSE:AMBP) is a company that develops, produces, and sells metal beverage cans. It also provides technical and customer support. Following the Q4 results, Barclays analyst Michael Leithead decreased his price objective on Ardagh Metal Packaging S.A. (NYSE:AMBP) to $10 from $12 and maintained an Equal Weight rating.
Canyon Capital Advisors strengthened its position in Ardagh Metal Packaging S.A. (NYSE:AMBP) by buying 6.05 million additional shares in Q4 2021. This makes the fund’s stake in Ardagh Metal Packaging S.A. (NYSE:AMBP) total 10.05 million shares worth $90.72 million.
Among the hedge funds tracked by Insider Monkey, 30 funds were long Ardagh Metal Packaging S.A. (NYSE:AMBP) at the end of December 2021, with stakes totaling $398.27 million, as compared to 27 funds in the preceding quarter, holding stakes in Ardagh Metal Packaging S.A. (NYSE:AMBP) worth $400.20 million.
8. Shaw Communications Inc. (NYSE:SJR)
Canyon Capital Advisors’ Stake Value: $105,166,000
Percentage of Canyon Capital Advisors’ 13F Portfolio: 3.57%
Number of Hedge Fund Holders: 19
Shaw Communications Inc. (NYSE:SJR) is a cable telecommunications and satellite television service provider. On January 25, CIBC analyst Robert Bek maintained an Outperform rating on Shaw Communications Inc. (NYSE:SJR), raising his price objective to C$40.50 from C$27.
According to the hedge funds monitored by Insider Monkey in Q4 2021, 19 funds reported owning stakes in Shaw Communications Inc. (NYSE:SJR), equaling $731.09 million, down from 21 funds in the previous quarter, holding stakes in Shaw Communications Inc. (NYSE:SJR) worth $892.63 million.
In the fourth quarter, Canyon Capital Advisors increased its stake in Shaw Communications Inc. (NYSE:SJR) by 335,300 shares, boosting its position by 11%. The hedge fund first invested in Shaw Communications Inc. (NYSE:SJR) in the third quarter of 2021. Canyon Capital Advisors owns more than 3.46 million shares of the company, worth more than $105.17 million as of Q4 2021.
7. Valaris Limited (NYSE:VAL)
Canyon Capital Advisors’ Stake Value: $115,137,000
Percentage of Canyon Capital Advisors’ 13F Portfolio: 3.91%
Number of Hedge Fund Holders: 30
Valaris Limited (NYSE:VAL) provides offshore contract drilling services to Bermuda and international oil and gas industries. Evercore ISI analyst James West began coverage of Valaris Limited (NYSE:VAL) on February 8 with an Outperform rating and a $72 price target.
In the fourth quarter of 2021, 30 hedge funds were bullish on Valaris Limited (NYSE:VAL), up from 26 funds in the quarter earlier. Canyon Capital Advisors holds more than 3.20 million shares in Valaris Limited (NYSE:VAL) worth over $115.14 million, representing 3.91% of its portfolio. In the fourth quarter of 2021, the hedge fund cut its stake in the company by 7%.
6. Xilinx, Inc. (NASDAQ:XLNX)
Canyon Capital Advisors’ Stake Value: $116,617,000
Percentage of Canyon Capital Advisors’ 13F Portfolio: 3.96%
Number of Hedge Fund Holders: 68
Xilinx, Inc. (NASDAQ:XLNX) creates highly adaptable and flexible computing platforms that enable fast innovation across many technologies, including cloud, edge, and endpoint. On the other hand, Canyon Capital Advisors revealed a 70% reduction in his holdings in Xilinx, Inc. (NASDAQ:XLNX). The investment has a value of $116.62 million and 550,000 shares as of the fourth quarter of 2021.
According to Insider Monkey’s Q4 database, 68 hedge funds were long Xilinx, Inc. (NASDAQ:XLNX), down from 62 funds in the preceding quarter. Matthew Halbower’s Pentwater Capital Management is one of the leading stakeholders of Xilinx, Inc. (NASDAQ:XLNX), with 4.05 million shares worth almost $857.87 million.
On February 14, Advanced Micro Devices (NASDAQ:AMD) announced the completion of its acquisition of Xilinx, Inc. (NASDAQ:XLNX) and the appointment of Dr. Lisa Su as the new chairperson of the board.
In addition to Dell Technologies Inc. (NYSE:DELL) and VMware, Inc. (NYSE:VMW), Xilinx, Inc. (NASDAQ:XLNX) is a notable stock from Canyon Capital Advisors’ Q4 portfolio.
Click to continue reading and see 5 Stocks to Buy According to Canyon Capital Advisors.
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Disclosure: None. 10 Stocks to Buy According to Canyon Capital Advisors is originally published on Insider Monkey.
