In this article, we discuss the 5 best stocks to buy now according to billionaire Larry Robbins. If you want to check out our detailed analysis of Glenview Capital, go directly to 10 Best Stocks to Buy Now According to Billionaire Larry Robbins.
5. DXC Technology Company (NYSE:DXC)
Glenview Capital’s Stake Value: $246 million
Percentage of Glenview Capital’s 13F Portfolio: 4.9%
Number of Hedge Fund Holders: 27
Number five on the list of best stocks to buy now according to billionaire Larry Robbins is DXC Technology Company (NYSE:DXC). It is a Virginia based IT company. Glenview leads the hedge funds invested in the company with 7.5 million shares. Harris Associates is a close second, owning 6.7 million shares as of Q1 2022. The total equity owned by 27 hedge funds amounts to $509 million.
On May 26, RBC Capital analyst Daniel Perlin lowered his price target on DXC to $39 from $47 but kept an Outperform rating on the stock. He told investors in his research note that the company’s FY23 guidance was light, but DXC Technology is progressing fast on its transition to a more digitally focused, consistent and transparent operator.
Miller Value Partners mentioned DXC technology in their Q2 2021 investor letter. Here’s what they had to say:
“DXC Technology Company (DXC) continued to climb higher during the quarter gaining 24.57%. The company reported solid Fiscal Year 4th quarter (FY4Q) results with revenue of $4.385B beating consensus of $4.29B and earnings per share (EPS) of $0.74 ahead of expectations for $0.70. The company guided for fiscal 2022 revenue of $16.6-$16.8B, below the Street at $16.9B and adjusted EPS of $3.45-3.65, ahead of the consensus of $3.43. By FY2024, the company expects organic revenue growth of 1-3%, adjusted earnings before income and taxes (EBIT) margin of 10-11%, adjusted diluted EPS of $5.00-$5.25 and free cash flow (FCF) of $1.5B. Later in the month, the company held an investor day where management highlighted their confidence that they can hit all of their targets while also stressing the progress they have made on their turnaround to date.”
4. McKesson Corporation (NYSE:MCK)
Glenview Capital’s Stake Value: $286.5 million
Percentage of Glenview Capital’s 13F Portfolio: 5.8%
Number of Hedge Fund Holders: 59
McKesson Corporation (NYSE:MCK) is an American pharmaceutical distributor and a provider of digital health services, medical supplies and care management equipment. The company has a 78,000-strong workforce and delivers 33% of all pharmaceuticals across the United States and Canada.
As of Q1 2022, Berkshire Hathaway, managed by Warren Buffett, is the leading stakeholder in the company, with nearly three million shares. The total money invested by 59 hedge funds in McKesson Corporation is north of $3.7 billion.
On June 7, Deutsche Bank analyst George Hill raised McKesson Corp to Buy from Hold and set a price target of $378 from $343. Hill’s bullish thesis on McKesson is a result of the analyst looking for defensive equity positioning due to concerns surrounding recessionary risks in the U.S.
Hill noted to investors that they can pay attention to McKesson Corporation that is trading at a discount relative to the market since the company is targeting double-digit sustainable and visible earnings and cash-flow growth in a defensive non-cyclical sector with sharply visible demand.
Baron Funds discussed McKesson Corporation (MCK) in their Q1, 2022 investor letter. Here’s what they said:
“Investments in health care distributors, health care services, and health care facilities along with cash exposure in a down market contributed to relative results. Within health care distributors, higher exposure to this strong performing sub-industry and outperformance of pharmaceutical distributor and technology solutions provider McKesson Corporation (NYSE:MCK) added value. McKesson was the top contributor as investors rotated into value stocks that were trading at low multiples of earnings. We continue to believe that McKesson’s stock is inexpensive in light of the company’s strong competitive position in growing end markets and earnings growth potential.”
3. Global Payments Inc. (NYSE:GPN)
Glenview Capital’s Stake Value: $322 million
Percentage of Glenview Capital’s 13F Portfolio: 6.5%
Number of Hedge Fund Holders: 64
Global Payments Inc. (NYSE:GPN) is a Fortune-500 financial technology company that provides payment processing solutions.
Global Payments Inc. (NYSE:GPN) has 64 hedge funds invested in its stock. The total hedge fund ownership equity stands at $3.2 billion as of the first quarter of 2022.
On May 17, Goldman Sachs analyst Will Nance initiated coverage of Global Payments Inc. (NYSE:GPN) with a Neutral rating on the shares and set a price target of $151, implying 24% upside. While constructive on Global Payments’ software-oriented approach, Nance views the company’s greater SMB and credit volume exposures as more economically sensitive and prefers to take a more defensive stance given the levels of macroeconomic uncertainty.
Oakmark Funds mentioned Global Payments Inc. (GPN) in their Q1 2022 investor letter. Here’s what they said:
“Global Payments (NYSE:GPN) is a leading provider of merchant acquiring services. The company is also one of the largest providers of payment processing and related technology solutions to credit card issuers. We believe Global Payments’ merchant acquiring business is well positioned given its strength in software-driven payments. This is one of the fastest growing parts of the industry as small business customers are increasingly recognizing the efficiency benefits of having payments seamlessly integrated into the software they use to run their businesses. In addition, Global Payments benefits from the broader secular shift away from cash and toward electronic payment methods. Together, these tailwinds have the potential to drive low-double-digit revenue growth and even faster earnings growth. With this strong outlook and with management returning a significant portion of free cash flow to shareholders via repurchase, we think the stock looks attractive at its current valuation of just 12.5x next year’s expected EPS.”
2. Cigna Corporation (NYSE:CI)
Glenview Capital’s Stake Value: $382 million
Percentage of Glenview Capital’s 13F Portfolio: 7.7%
Number of Hedge Fund Holders: 63
Cigna Corporation (NYSE:CI) is a managed healthcare and insurance company. It is headquartered in Bloomfield, Connecticut. The company’s equity that is owned by 63 hedge funds is worth $2.6 billion as of the first quarter of 2022.
On June 16, Loop Capital analyst Joseph France initiated coverage of Cigna Corporation with a Hold rating and a $270 price target.
Cigna Corporation was brought up by Davis Funds in their Q4 2021 letter. Here’s what they said:
“Healthcare is included in the portfolio both for company-specific reasons, as well as big picture trends. At the company level, we hold select companies in pharmaceuticals, healthcare services and health insurance at attractive valuations. This is at a time when the average age of the U.S. population is fast approaching 40, older than Asia-Pacific and a little younger than the aged populations of Europe and Japan. The number of seniors in the U.S.—i.e., 65 years or older— now surpasses 54 million, or about 15% of the population. Seniors, on average, take a much greater number of medications and account for a large and disproportionate share of healthcare spending, and we expect that trend to continue due to both raw demographics and a proliferation in the number of available treatments and services available now, the latter being driven by innovation and investment in the healthcare industry. Representative holdings in the Fund include Cigna, United Health Group, Viatris and Quest Diagnostics.”
1. Tenet Healthcare Corporation (NYSE:THC)
Glenview Capital’s Stake Value: $548 million
Percentage of Glenview Capital’s 13F Portfolio: 11%
Number of Hedge Fund Holders: 55
The number one stock on the list of 10 best stocks to buy now according to billionaire Larry Robbins is Tenet Healthcare Corporation (NYSE:THC). It is one of the largest healthcare corporations in the US. The company operates 65 hospitals and more than 450 healthcare facilities.
On June 16, Loop Capital analyst Joseph France initiated coverage of Tenet Healthcare Corporation with a Buy rating on the shares and a $80 price target. The analyst said that the company’s rapidly growing ambulatory surgery business could generate well over half of its adjusted EBITDA within a span of two years. France added that he likes THC because he expects that the valuation discrepancy will ultimately be addressed by Tenet’s management.
Oakmark Funds discussed Tenet Healthcare in their Q3 2021 letter. Here’s what they had to say:
“Tenet may be best known as the second-largest public hospital chain in the U.S., but its largest business is outpatient acute care centers. In early 2020, investors fled the health care industry because of the great uncertainty that the pandemic presented. The early days of the pandemic were very hard on the hospital industry especially, but as the Covid-19 surge peaked and diminished, hospitals were able to schedule elective procedures and engage in profitable activities.”
You can also take a peek at 5 Value Stocks to Buy According to Billionaire David Tepper and Top 10 Stock Picks of Randall Smith’s Alden Global
