In this piece, we’ll take a look at the 5 Best IPO Stocks To Buy Heading Into 2023. For more such companies, go to 12 Best IPO Stocks To Buy Heading Into 2023.
5. Hertz Global Holdings, Inc. (NASDAQ:HTZ)
Number of Hedge Fund Holders: 47
IPO Year: 2021
Headquartered in Estero, Florida, Hertz Global Holdings, Inc. (NASDAQ:HTZ) is a US-based car rental company. The company operates its car rental services through a network of car rental locations under the brand name Hertz, Dollar rent a car, Firefly Car Rental, and Thrifty Car Rental.
On December 6, 2022, Christopher Stathoulopoulos, an analyst at Susquehanna, began covering Hertz Global Holdings, Inc. (NASDAQ:HTZ) with a price target of $18 and a Neutral rating. The analyst believes that the pent-up travel demand is going to normalize in the future, although the timing of it would be hard to predict.
According to Insider Monkey’s database, 47 hedge funds held stakes in Hertz Global Holdings, Inc. (NASDAQ:HTZ) at the end of the third quarter ending September 2022. Knighthead Capital remained the leading stakeholder in the company at the end of Q3 2022.
4. ZoomInfo Technologies Inc. (NASDAQ:ZI)
Number of Hedge Fund Holders: 50
IPO Year: 2020
ZoomInfo Technologies Inc. (NASDAQ:ZI) is a software company that provides an intelligence platform to sales and marketing teams. Its cloud-based platform provides a comprehensive analysis of organizations and professionals. The principal market for ZoomInfo Technologies Inc. (NASDAQ:ZI) is the US, which accounts for the majority of the company’s revenues.
On October 5, 2022, an analyst at Morgan Stanley, Elizabeth Porter, began covering ZoomInfo Technologies Inc. (NASDAQ:ZI) with a price target of $66. Elizabeth Porter has an Overweight rating on the stocks, and her confidence in the company stems from the company’s strong growth prospects. The analyst believes that ZoomInfo Technologies Inc. (NASDAQ:ZI) can consistently increase revenue by more than 30% while also achieving operating margins of more than 40%.
As per Insider Monkey’s database, 50 hedge funds remained bullish on ZoomInfo Technologies Inc. (NASDAQ:ZI) at the end of the third quarter. Citadel Investment Group had the biggest stake in the company at the end of the third quarter.
Here is what Baron Funds has to say about ZoomInfo Technologies Inc. (NASDAQ:ZI) in its Q3 2021 investor letter:
Favorable stock selection in Communication Services came from ZoomInfo Technologies Inc., a leading go-to-market intelligence platform for sales and marketing teams. We believe that the company’s recent acquisition of Chorus.ai, a conversation intelligence business, dramatically increased the data visibility and benefits that ZoomInfo can offer its clients. In addition, its organic revenues reaccelerated for a fifth consecutive quarter and management significantly raised its earnings guidance.
3. Airbnb, Inc. (NASDAQ:ABNB)
Number of Hedge Fund Holders: 58
IPO Year: 2020
Founded in 2008, Airbnb, Inc. (NASDAQ:ABNB) is a leading accommodation travel company. The company offers a marketplace for short-term homestays and experiences for tourists and travelers. Airbnb, Inc. (NASDAQ:ABNB) charges a commission fee on each booking and acts as a broker between the owner and the traveler.
On November 22, 2022, Mario Lu, an analyst at Barclays, increased his price target on Airbnb, Inc. (NASDAQ:ABNB) to $103 from $101 while keeping an Equal Weight rating on the stock. The analyst revised his forecast after the company’s Q3 earnings and now believes that the travel industry is expected to grow by 12% in 2023.
58 hedge funds were long on the company’s stock at the end of the third quarter, according to Insider Monkey’s database. Renaissance Technologies had the biggest long position in the company at the end of Q3 2022.
In its Q2 2022 investor letter, Brick By Brick Capital, an asset management firm, highlighted a few stocks, and Airbnb, Inc. (NASDAQ:ABNB) was one of them. Here is what the fund said:
What is millennial tech?
It is a term I have coined to describe the type of companies I research. It is a disruptive technology that is changing the status quo of a given industry. For example, Airbnb (NASDAQ:ABNB) with the lodging industry. This definition casts a wide net in terms of what sectors I look at, but it is very specific in terms of what type of companies I look at. I also believe focusing on these companies gives me an inherent edge over Wall St. as they are often older and disconnected from what is truly innovative (…read more)
2. Bill.com Holdings, Inc. (NYSE:BILL)
Number of Hedge Fund Holders: 70
IPO Year: 2019
Bill.com Holdings, Inc. (NYSE:BILL) is a cloud-based financial software platform that simplifies, digitizes, and provides automation in financial operations for small and medium-sized enterprises (SMBs). The company generates sales through a subscription-based model.
On November 7, 2022, Keith Weiss, an analyst at Morgan Stanley, reduced his price target on Bill.com Holdings, Inc. (NYSE:BILL) to $200 from $220 while keeping an Overweight rating on the shares. According to the analyst, the company’s Q1 results came in better than expected, with the company continuing to demonstrate strong execution.
As per Insider Monkey’s database, 70 hedge funds owned stakes in Bill.com Holdings, Inc. (NYSE:BILL) at the end of the September quarter. Abdiel Capital Advisors was the most bullish fund on the company’s stock at the end of Q3 2022.
1. Snowflake Inc. (NYSE:SNOW)
Number of Hedge Fund Holders: 73
IPO Year: 2020
Headquartered in Montana, United States, Snowflake Inc. (NYSE:SNOW) is a cloud-computing company. The data reserves of Snowflake Inc. (NYSE:SNOW) provide unstructured and semi-structured data to analysts and allow companies to buy data easily through a single platform.
On December 01, 2022, analyst Mike Cikos at Needham reduced his price target on Snowflake Inc. (NYSE:SNOW) to $165 while keeping a Buy rating on the stock. According to the analyst, the Q3 results of the company displayed strong growth, with product revenue increasing 67% year on year. However, the management’s guidance for Q4 sent mixed signals to investors.
According to Insider Monkey’s database, 73 hedge funds held shares of the company at the end of the third quarter of 2022. Altimeter Capital Management was the most bullish fund on the company’s stock at the end of Q3 2022.
Here is what Baron Funds had to say about Snowflake Inc. (NYSE:SNOW) in its third-quarter 2022 investor letter:
Snowflake Inc. (NYSE:SNOW) provides a cloud platform for large-scale data analytics. Snowflake’s shares were up 22%, reacting positively to second quarter results that beat market forecasts with revenue growth of 83% year-over year and adjusted free-cash-flow margins of 12%. Record new customer additions and world-class dollar net retention of over 170% implied resiliency in demand despite increasing macro uncertainties. We remain shareholders and believe that Snowflake will be able to benefit from long-term growth with favorable unit economics, addressing one of the largest opportunities in technology. Snowflake’s culture of innovation (such as its expansion into cloud application development and data sharing), go-to-market initiatives, and an ongoing secular shift to the cloud in its end markets should help, in our view, sustain the company’s competitive moats over the long term.
You can also take a look at 12 Very High Yield Dividend Stocks To Buy and 10 Best Companies to Invest In India for Beginners.
