5 Biggest Losers in Warren Buffett’s Latest Portfolio

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1. RH (NYSE:RH)

Number of Hedge Fund Holders: 58

Year-to-Date Loss as of May 20: 50.10%

RH (NYSE:RH) is a California-based company that offers home furnishings such as furniture, lighting, textiles, bathware, decor, and outdoor and garden fittings. Warren Buffett added RH (NYSE:RH) to his portfolio in Q3 2019, by purchasing 1.20 million shares priced at $142.38 each. In Q1 2022, Berkshire Hathaway boosted its RH (NYSE:RH) stake by 20%, holding 2.17 million shares worth $707.6 million. Year to date, RH (NYSE:RH) stock has declined by 50.10%, making it one of the biggest losers in Warren Buffett’s latest portfolio. 

On May 16, Morgan Stanley analyst Simeon Gutman initiated coverage of RH (NYSE:RH) with an Equal Weight rating and a $400 price target. The analyst views RH (NYSE:RH) as a “transcendent brand with the most long-term upside potential” in his coverage. However, a 12-month view gives him “pause” with a “category reversion and potential recession” looming.

According to Insider Monkey’s Q4 data, 57 hedge funds were long RH (NYSE:RH), with combined stakes worth $4.8 billion. In Q1 2022, Stephen Mandel’s Lone Pine Capital was a significant shareholder of the company, with 1.70 million shares worth $557.35 million. 

Here is what Polen Global SMID Company Growth Fund has to say about RH (NYSE:RH) in its Q4 2021 investor letter:

“Our most significant detractors from performance over the fourth quarter includes RH. Upscale home-furnishings company RH underperformed over the quarter and the year amid rising costs that weighed on expectations and heightened concerns of reduced discretionary spending amid the ongoing pandemic. We expect the company to grow revenues as it rolls out additional galleries across the globe and thoughtfully expands into adjacencies like guest homes and design services. Along with steady margin growth through fixed cost leverage, which the company has consistently shown it can achieve, we believe this expansion should lead to favorable cash earnings growth going forward.”

You can also take a look at Top 10 Stock Picks of Chase Coleman’s Tiger Global Management and Kim Schrier Stock Portfolio: 10 Stocks To Consider.

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