In this article, we discuss 10 stocks under $25 to buy according to billionaire Philippe Laffont. If you want to skip our detailed analysis of these stocks, go directly to 5 Stocks Under $25 to Buy According to Billionaire Philippe Laffont.
Coatue Management, a technology-themed investment management company, was founded by Philippe Laffont in 1999. Philippe Laffont is an American billionaire hedge fund manager and venture capitalist, with a Bachelor’s in computer science from MIT.
Laffont currently serves as the portfolio manager of Coatue Management, and oversees a 13F portfolio worth $24.5 billion as of Q3 2021. His hedge fund’s investment activity is largely concentrated in the healthcare, information technology, consumer discretionary, communications, and finance sectors, with the top ten holdings making up 45.48% of the total portfolio.
Philippe Laffont began his career in 1992 with McKinsey & Company as an analyst, staying with the firm till 1994. For the next two years, he worked as an independent consultant, before joining Julian Robertson’s Tiger Management in 1996 as a research analyst. Laffont is one of the so-called Tiger Cubs who ventured out on their own, successfully establishing their own hedge funds.
As per the 13F filings from September, Coatue Management purchased 13 new stocks, reduced holdings in 37 equities, sold out of 13 companies, and bought additional stakes in 11 securities. The hedge fund’s top buys for the third quarter included JD.com, Inc. (NASDAQ:JD), Microsoft Corporation (NASDAQ:MSFT), and Confluent, Inc. (NASDAQ:CFLT). Whereas, Coatue Management reduced holdings in Amazon.com, Inc. (NASDAQ:AMZN), Block, Inc. (NYSE:SQ), and PayPal Holdings, Inc. (NASDAQ:PYPL). Laffont’s portfolio also consists of value stocks and affordably priced equities, in addition to expensive blue chip stocks.
The most notable stocks from Philippe Laffont’s Q3 portfolio include Tesla, Inc. (NASDAQ:TSLA), Meta Platforms, Inc. (NASDAQ:FB), and Netflix, Inc. (NASDAQ:NFLX).
Philippe Laffont of Coatue Management
Our Methodology
We used the third quarter portfolio of Philippe Laffont’s Q3 portfolio to select the billionaire’s top 10 stocks priced under $25, ranking the companies according to Laffont’s stake value in each holding.
The analyst ratings, Q3 earnings, and the hedge fund sentiment around each stock is also discussed to provide readers with some additional context regarding their investment decisions.
Stocks Under $25 to Buy According to Billionaire Philippe Laffont
10. RLX Technology Inc. (NYSE:RLX)
Coatue Management’s Stake Value: $64,210,000
Percentage of Coatue Management’s 13F Portfolio: 0.26%
Number of Hedge Fund Holders: 11
Share Price as of January 12: $3.82
RLX Technology Inc. (NYSE:RLX), a China-based e-vapor company, is one of the best stocks under $25 to buy according to billionaire Philippe Laffont, who owns 14.2 million shares of RLX Technology Inc. (NYSE:RLX) as of the third quarter, worth $64.2 million, representing 0.26% of his total Q3 investments.
RLX Technology Inc. (NYSE:RLX), on December 3, posted its Q3 results. The company announced earnings per diluted average share of $0.05. Revenue over the period totaled $260.2 million, down 34% year-over-year, owing to the COVID-19 restrictions in China, which had a negative impact on sales and channel inventory management.
On December 8, RLX Technology Inc. (NYSE:RLX) announced that its board of directors has authorized a share repurchase program under which the company may repurchase up to $500 million of its shares over a period until December 31, 2023.
11 hedge funds monitored by Insider Monkey were bullish on RLX Technology Inc. (NYSE:RLX) in the third quarter, with total stakes valued at $251.8 million. Wildcat Capital Management is the largest RLX Technology Inc. (NYSE:RLX) stakeholder as of September, increasing its stake in the company by 2762%, holding a $107.7 million position.
Citi analyst Lydia Ling on December 6 lowered the price target on RLX Technology Inc. (NYSE:RLX) to $11.50 from $15.10 and kept a Buy rating on the shares post the Q3 results.
In addition to Tesla, Inc. (NASDAQ:TSLA), Meta Platforms, Inc. (NASDAQ:FB), and Netflix, Inc. (NASDAQ:NFLX), RLX Technology Inc. (NYSE:RLX) is a top stock pick of billionaire Philippe Laffont.
9. Stitch Fix, Inc. (NASDAQ:SFIX)
Coatue Management’s Stake Value: $64,867,000
Percentage of Coatue Management’s 13F Portfolio: 0.26%
Number of Hedge Fund Holders: 30
Share Price as of January 12: $18.33
Stitch Fix, Inc. (NASDAQ:SFIX) is a California-based digital styling service which uses different algorithms to customize clothes according to an individual’s style, budget, and personal preferences. The company serves customers in the United States and the United Kingdom.
Philippe Laffont, as of September 2021, owns 1.62 million Stitch Fix, Inc. (NASDAQ:SFIX) shares, worth $64.8 million, accounting for 0.26% of the billionaire’s total 13F portfolio.
On December 7, Stitch Fix, Inc. (NASDAQ:SFIX) posted its financial results for Q1 2022. The company reported a loss per share of $0.02, beating estimates by $0.11. Revenue for the quarter jumped 18.52% year-over-year to $581.24 million, exceeding estimates by $10.76 million.
JPMorgan analyst Cory Carpenter lowered the price target on Stitch Fix, Inc. (NASDAQ:SFIX) to $20 from $25 and kept a Neutral rating on the shares on December 15. In 2022, the analyst expects the internet group to be in a stronger position than pre-pandemic levels due to increased digitization of the economy, and he prefers e-commerce and subscription based names over online advertising.
A total of 30 hedge funds reported owning stakes worth $600.6 million in Stitch Fix, Inc. (NASDAQ:SFIX) during Q3 2021, as compared to 35 funds in the preceding quarter, holding stakes in the company amounting to $702.7 million.
Slate Path Capital, the leading Stitch Fix, Inc. (NASDAQ:SFIX) stakeholder, boosted its position in the company by 18% in the third quarter, holding 2.98 million shares worth $119.1 million.
Here is what Baron Funds has to say about Stitch Fix, Inc. (NASDAQ:SFIX) in its Q3 2021 investor letter:
“Weakness in Consumer Discretionary was largely due to share price declines in online personal styling service Stitch Fix, Inc. Stitch Fix’s shares fell in the aftermath of poorly communicated changes to its stylist employment program.”
8. Nikola Corporation (NASDAQ:NKLA)
Coatue Management’s Stake Value: $81,084,000
Percentage of Coatue Management’s 13F Portfolio: 0.32%
Number of Hedge Fund Holders: 15
Share Price as of January 12: $10.70
Nikola Corporation (NASDAQ:NKLA), an Arizona-based manufacturer of electric vehicles, is one of the top stocks under $25 to buy according to billionaire Philippe Laffont. Laffont’s Coatue Management owns 7.59 million Nikola Corporation (NASDAQ:NKLA) shares, worth over $81 million, representing 0.32% of the firm’s Q3 investments.
In the third quarter earnings report published on November 4, Nikola Corporation (NASDAQ:NKLA) posted a loss per share of $0.22, beating estimates by $0.04.
Wedbush analyst Daniel Ives raised the price target on Nikola Corporation (NASDAQ:NKLA) to $15 from $10 and kept a Neutral rating on the shares on November 8. The analyst observed that Nikola Corporation (NASDAQ:NKLA) has taken important steps towards regaining its Wall Street credibility as the company’s Arizona factory build-out, key partnerships, and settling the SEC issues are “all positives in the eyes of the Street.”
Jeff Ubben’s Inclusive Capital is the biggest Nikola Corporation (NASDAQ:NKLA) stakeholder as of the third quarter, with 10.2 million shares worth $109.6 million. Overall, the Q3 database of Insider Monkey suggests that 15 hedge funds were bullish on the stock.
7. Oscar Health, Inc. (NYSE:OSCR)
Coatue Management’s Stake Value: $107,702,000
Percentage of Coatue Management’s 13F Portfolio: 0.43%
Number of Hedge Fund Holders: 17
Share Price as of January 12: $7.26
Oscar Health, Inc. (NYSE:OSCR) is an American health insurance company from New York, priced at $7.26 as of January 12, which made it to our list of the best stocks under $25 to buy according to billionaire Philippe Laffont. Coatue Management owns 6.1 million Oscar Health, Inc. (NYSE:OSCR) shares in the third quarter, valued at $107.7 million, representing 0.43% of the firm’s total investments.
Publishing its Q3 results on November 10, Oscar Health, Inc. (NYSE:OSCR) posted a loss per share of $1.02, missing estimates by $0.37. The quarterly revenue equaled $668.38 million, outperforming estimates by $27.38 million.
The Q3 database of Insider Monkey reported that 17 hedge funds were long Oscar Health, Inc. (NYSE:OSCR), up from 16 funds in the prior quarter. Joshua Kushner’s Thrive Capital is the largest Oscar Health, Inc. (NYSE:OSCR) stakeholder, boosting its stake in the company by 15% in the third quarter, holding 37.6 million shares worth $654.1 million.
6. KE Holdings Inc. (NYSE:BEKE)
Coatue Management’s Stake Value: $125,830,000
Percentage of Coatue Management’s 13F Portfolio: 0.51%
Number of Hedge Fund Holders: 26
Share Price as of January 12: $22.74
KE Holdings Inc. (NYSE:BEKE) is a Chinese company assisting with housing transactions online and on-premises, making the process easier for home buyers. Coatue Management recently acquired KE Holdings Inc. (NYSE:BEKE), purchasing 6.89 million shares of the company in Q3 2021, worth $125.8 million, representing 0.51% of the firm’s total 13F portfolio.
JPMorgan analyst Alex Yao upgraded KE Holdings Inc. (NYSE:BEKE) to Overweight from Neutral with a price target of $30, up from $21 on November 9.
On November 8, KE Holdings Inc. (NYSE:BEKE) posted its Q3 results, reporting a loss per share of $0.12, missing estimates by $0.07. The $2.83 billion revenue dropped 9.29% year-over-year, but exceeded estimates by $442.26 million.
According to the hedge funds tracked by Insider Monkey in the third quarter, 26 funds were long KE Holdings Inc. (NYSE:BEKE), and Lone Pine Capital was the leading company stakeholder, with a $551.4 million position in the company as of September.
KE Holdings Inc. (NYSE:BEKE) is a notable stock pick of billionaire Philippe Laffont, just like Tesla, Inc. (NASDAQ:TSLA), Meta Platforms, Inc. (NASDAQ:FB), and Netflix, Inc. (NASDAQ:NFLX).
Here is what Tao Value has to say about KE Holdings Inc. (NYSE:BEKE) in its Q3 2021 investor letter:
“As witnessed in the past quarter, the government intervention in the Chinese private sector is elevated to an unprecedented level. Given this background, I thoroughly reviewed all our Chinese holdings and made a few changes. We exited KE holdings (ticker: BEKE), for high potential regulatory risk and the passing of the visionary founder & CEO Zuo Hui (who was a core tenet of our original thesis).”
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Disclosure: None. 10 Stocks Under $25 to Buy According to Billionaire Philippe Laffont is originally published on Insider Monkey.
