This article discusses Skylands Capital’s top 5 stock picks at the end of March 2022. If you want to know about the fund’s history, its investment strategy and recent performance, please also read 10 Best Stocks to Buy According to Charles Paquelet’s Skylands Capital.
5. General Motors Company (NYSE:GM)
Skylands Capital’s Stake Value: $27,946,000
Percentage of Skylands Capital’s 13F Portfolio: 4.09%
Number of Hedge Fund Holders(Q1): 76
Though Skylands Capital increased its stake in General Motors Company (NYSE:GM) by 6% during the second quarter, GM remained the fund’s fifth-largest holding at the end of that period. General Motors Company (NYSE:GM) has been trying to increase its portfolio of Electric vehicles(EV) over the past few years.
To ensure a continuing supply of lithium, which is heavily used in EV batteries and has witnessed an exponential rise in demand over the past few years, General Motors Company (NYSE:GM) recently signed a deal with Livent Corporation (NYSE:LTHM). According to the terms of the agreement, General Motors Company (NYSE:GM) will get a 6-year guaranteed supply of lithium by prepaying Livent Corporation (NYSE:LTHM) $198 million.
General Motors Company (NYSE:GM) recently raised $2.25 billion in debt through two debt offerings. It raised $1 billion through senior unsecured notes yielding 5.4% due in 2029 and another $1.25 billion through unsecured notes yielding 5.6% due in 2032. The company plans to use the proceeds from these offerings to finance or refinance the projects it has mentioned under its Sustainable Finance Framework.
4. Crown Castle International Corp. (NYSE:CCI)
Skylands Capital’s Stake Value: $43,748,000
Percentage of Skylands Capital’s 13F Portfolio: 6.41%
Number of Hedge Fund Holders(Q1): 50
The number of hedge funds covered by us that held a stake in Crown Castle International Corp. (NYSE:CCI) at the end of March increased to 50 from 39 at the end of 2021. Among them, billionaire Ken Fisher’s Fisher Asset Management held the most number of shares of the company at 2.76 million, valued at close to $510 million at the end of the first quarter.
Crown Castle International Corp. (NYSE:CCI) is the second largest specialized REIT by market cap currently in the United States. It operates approximately 80,000 route miles of fiber and 40,000 cell towers across the country. On July 22, Deutsche Bank analyst Matthew Niknam increased his price target to $185 from $183 but maintained a “Hold” rating on the stock.
3. Arch Resources, Inc. (NYSE:ARCH)
Skylands Capital’s Stake Value: $45,226,000
Percentage of Skylands Capital’s 13F Portfolio: 6.63%
Number of Hedge Fund Holders(Q1): 45
Coal mining company Arch Resources, Inc. (NYSE:ARCH) has seen a multifold increase in its stock price since late 2020 on the back of increasing demand for coal globally. Though the stock has cooled down quite a bit from the all-time high of $183.53 it made recently, it is still trading up by over 42% year-to-date.
Arch Resources, Inc. (NYSE:ARCH) has announced two massive special dividends of $7.86 and $5.75 per share for its shareholders since the beginning of this year. These special dividends are on top of the current $0.25 per share dividend the company pays every quarter. However, several analysts think that Arch Resources, Inc.’s (NYSE:ARCH) stock is overvalued at the moment solely due to the company’s recent spectacular financial performance. According to them, the stock can fall significantly once the demand for coal, which is now considered a fuel of last resort, starts to cool off.
2. Apple Inc. (NASDAQ:AAPL)
Skylands Capital’s Stake Value: $45,768,000
Percentage of Skylands Capital’s 13F Portfolio: 6.7%
Number of Hedge Fund Holders(Q1): 131
Smartphone giant Apple Inc. (NASDAQ:AAPL) has remained Skylands Capital’s second favourite stock pick for over two years. During that time, shares of Apple Inc. (NASDAQ:AAPL) have appreciated by more than 90%.
Apple Inc.’s (NASDAQ:AAPL) sales from its services business, which primarily constitutes revenues from its App store, has shown double-digit growth for the past several years. However, as that business matures and its growth flattens out Apple Inc. (NASDAQ:AAPL) is looking at other avenues for growth, such as Apple TV+ and Apple Card.
Apple Inc. (NASDAQ:AAPL) recently announced that as part of its promotional effort for its new animated movie ‘Luck’, users of Apple Card could get a free Apple TV+ subscription for three months.
1. Union Pacific Corporation (NYSE:UNP)
Skylands Capital’s Stake Value: $57,605,000
Percentage of Skylands Capital’s 13F Portfolio: 8.44%
Number of Hedge Fund Holders(Q1): 89
Skylands strengthened its stake in its top stock pick Union Pacific Corporation (NYSE:UNP) by purchasing an additional 28,300 shares during the second quarter. Shares of the railroad major have been on a consistent upward trajectory for the past many years. In the last 5 and 10 years, Union Pacific Corporation’s (NYSE:UNP) stock has appreciated by 121% and 275%, respectively.
Union Pacific Corporation (NYSE:UNP) has been a hot favourite among the dividend investing crowd for many years now. It has consistently increased its per-share dividend payout in the last 17 years. In the last five years alone, Union Pacific Corporation (NYSE:UNP) annual dividend has grown at a CAGR of close to 15%.
Out of the 18 analysts covering Union Pacific Corporation (NYSE:UNP) on Wall Street, 11 currently have a ‘Hold’ rating on the stock. The consensus price target for the stock among those 18 analysts is currently $248.48.
You can also look at Simon Sadler’s Segantii Capital is Bullish on These 10 Stocks and 7 Best Stocks to Buy According to Stephen Feinberg’s Cerberus Capital Management
