In this article, we discuss 5 new stock picks of billionaire Dan Loeb. If you want our detailed analysis of these stocks, go directly to 10 New Stock Picks of Billionaire Dan Loeb.
5. Jackson Financial Inc. (NYSE:JXN)
Third Point’s Stake Value: $47,115,000
Percentage of Third Point’s 13F Portfolio: 0.25%
Number of Hedge Fund Holders: 22
Jackson Financial Inc. (NYSE:JXN) is a Michigan-based life insurance company that primarily provides a suite of annuities as retirement savings and income solutions to retail investors in the United States.
Jackson Financial Inc. (NYSE:JXN) is a new arrival in Dan Loeb’s Q3 portfolio, with the billionaire buying 1.8 million shares of the company, worth $47.1 million, representing 0.25% of his third quarter 13F securities.
On November 9, Jackson Financial Inc. (NYSE:JXN) declared a $0.50 per share quarterly dividend, which was paid on December 9, to shareholders of record on November 19. The board also authorized a $300 million share repurchase program for Jackson Financial Inc. (NYSE:JXN)’s Class A common stock.
Jefferies analyst Suneet Kamath initiated coverage of Jackson Financial Inc. (NYSE:JXN) on January 25 with a Buy rating and a $52 price target. The analyst believes Jackson Financial Inc. (NYSE:JXN) is a “misunderstood story” given its limited sell-side coverage and track record as a public company, “suggesting the potential for a re-rating as investors get more comfortable with the story”.
Sessa Capital holds the largest stake in Jackson Financial Inc. (NYSE:JXN) as of Q3 2021, with 4.4 million shares worth approximately $117 million. Overall, 22 hedge funds monitored by Insider Monkey in the third quarter were long Jackson Financial Inc. (NYSE:JXN), with stakes valued at $345.7 million.
Here is what Curreen Capital has to say about Jackson Financial Inc. (NYSE:JXN) in its Q4 2021 investor letter:
“We cut a weed with Conduent to water a flower with Jackson. We added to Jackson, which has blossomed into a flower. In our Q3 letter I highlighted the limited information on this recent spinoff – and management has capably addressed many of the unknowns. On capital allocation, Jackson initiated a dividend and a share repurchase plan for about 10% of the company. Management then moved quickly and bought back at least 5% of Jackson’s shares at very attractive prices. Management refinanced its short-term debt on attractive terms. A director and an executive also bought stock in the quarter. Each of these actions made Jackson more of a flower. We averaged up (paying $32.78/share) and made Jackson our largest holding.”
4. CF Industries Holdings, Inc. (NYSE:CF)
Third Point’s Stake Value: $55,820,000
Percentage of Third Point’s 13F Portfolio: 0.30%
Number of Hedge Fund Holders: 49
CF Industries Holdings, Inc. (NYSE:CF) is an Illinois-based company producing hydrogen and nitrogen products for clean energy, fertilizer, controlling emissions, and relevant global industrial applications. Dan Loeb added CF Industries Holdings, Inc. (NYSE:CF) to his third quarter portfolio, buying 1 million shares worth $55.8 million.
RBC Capital analyst Andrew Wong on January 24 raised the price target on CF Industries Holdings, Inc. (NYSE:CF) to $75 from $73 but kept a Sector Perform rating on the shares. The analyst expects a solid quarter and positive outlook from CF Industries Holdings, Inc. (NYSE:CF) supported by strong nitrogen market fundamentals, but his neutral stance reflects greater variability in nitrogen prices.
On February 2, CF Industries Holdings, Inc. (NYSE:CF) declared a $0.30 per share quarterly dividend, in line with previous. The dividend is payable on February 28, to shareholders of record on February 15.
Among the hedge funds tracked by Insider Monkey in Q3 2021, 49 funds were bullish on CF Industries Holdings, Inc. (NYSE:CF), with stakes totaling $1.27 billion, as compared to 47 funds in the preceding quarter, holding stakes worth $955.5 million in CF Industries Holdings, Inc. (NYSE:CF). Glendon Capital Management held the largest stake in CF Industries Holdings, Inc. (NYSE:CF) as of Q3 2021, with 4.95 million shares worth $276.7 million.
3. Archaea Energy Inc. (NYSE:LFG)
Third Point’s Stake Value: $80,874,000
Percentage of Third Point’s 13F Portfolio: 0.44%
Number of Hedge Fund Holders: 25
Archaea Energy Inc. (NYSE:LFG) is a Pennsylvania-based renewable natural gas (RNG) company that develops RNG facilities to capture waste emissions and turn them into low carbon fuel. Billionaire Dan Loeb, via Third Point, acquired a position worth $80.8 million in Archaea Energy Inc. (NYSE:LFG) in the third quarter of 2021. The stock accounts for 0.44% of the fund’s Q3 investment portfolio.
On January 27, Archaea Energy Inc. (NYSE:LFG) expanded its commercial partnership with FortisBC Energy, a subsidiary of Fortis Inc. (NYSE:FTS), by inking a new long-term RNG purchase and sale agreement. FortisBC will purchase up to 7.6 million MMBtu of RNG generated by Archaea Energy Inc. (NYSE:LFG) annually for a fixed fee for 20 years. The deal is expected to commence in 2022, with the full annual quantity starting in 2025.
Citi analyst Timm Schneider lowered the price target on Archaea Energy Inc. (NYSE:LFG) on January 18 to $29 from $31 and kept a Buy rating on the shares. The analyst now has a higher cost of capital assumption and is marking-to-market his forward multiples to current peer valuation ranges on the heels of the recent broader renewable and alternative energy market sell-off.
According to the Q3 database of Insider Monkey, 25 hedge funds were bullish on Archaea Energy Inc. (NYSE:LFG), with stakes equaling $317.7 million.
2. Activision Blizzard, Inc. (NASDAQ:ATVI)
Third Point’s Stake Value: $154,780,000
Percentage of Third Point’s 13F Portfolio: 0.84%
Number of Hedge Fund Holders: 80
Activision Blizzard, Inc. (NASDAQ:ATVI) delivers interactive entertainment and advertising content to customers in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. Billionaire Dan Loeb acquired a stake in Activision Blizzard, Inc. (NASDAQ:ATVI) in Q3 2021, buying 2 million shares worth $154.78 million, representing 0.84% of his 13F securities for the period.
On February 4, 2021, Activision Blizzard, Inc. (NASDAQ:ATVI) declared a $0.47 per share annual dividend, a 14.6% increase from its prior dividend of $0.41, which was paid on May 6.
On January 18, Microsoft Corporation (NASDAQ:MSFT) announced that it is buying Activision Blizzard, Inc. (NASDAQ:ATVI) in its largest acquisition to date, for $68.7 billion. This will mark Microsoft Corporation (NASDAQ:MSFT)’s entry into the videogame market. The deal values Activision Blizzard, Inc. (NASDAQ:ATVI) at $95 a share and is expected to close in FY2023.
KeyBanc analyst Tyler Parker lowered the price target on Activision Blizzard, Inc. (NASDAQ:ATVI) on January 28 to $95 from $100 and kept an Overweight rating on the shares. Though the market is pricing in a fair amount of regulatory concern with the Microsoft Corporation (NASDAQ:MSFT) deal, the analyst believes it will go through successfully.
In the third quarter of 2021, 80 hedge funds tracked by Insider Monkey were long Activision Blizzard, Inc. (NASDAQ:ATVI), with stakes totaling $4.28 billion, as compared to 78 funds in the prior quarter, holding stakes worth $3.65 billion in Activision Blizzard, Inc. (NASDAQ:ATVI).
D E Shaw, the largest Activision Blizzard, Inc. (NASDAQ:ATVI) stakeholder, increased its position in the company by 1084% in Q3 2021, holding 9.8 million shares worth $765.25 million.
Here is what Cooper Investors has to say about Activision Blizzard, Inc. (NASDAQ:ATVI) in its Q4 2021 investor letter:
“In our previous letter we discussed the Responsible Investing aspects around the workplace issues disclosed earlier in the year at Activision Blizzard. Subsequently, further information emerged including allegations and anecdotes of historic awareness and inaction to the issues within the ranks of executive management. So too the latest earnings announcement saw the Blizzard studio push out several game launches, a very real consequence of workplace issues in a human capital-based business. The remedial efforts required are greater than we originally thought and the position was sold in what has been a disappointing experience.”
1. Alight, Inc. (NYSE:ALIT)
Third Point’s Stake Value: $195,160,000
Percentage of Third Point’s 13F Portfolio: 1.06%
Number of Hedge Fund Holders: 42
Alight, Inc. (NYSE:ALIT) is one of the newest additions in the third quarter portfolio of Dan Loeb’s Third Point, with the billionaire purchasing 17 million shares of the company, worth $195.1 million, representing 1.06% of the fund’s 13F securities. Alight, Inc. (NYSE:ALIT) is an Illinois-based provider of employer solutions, such as benefits and payroll solutions, as well as employee well-being programs that enrich company cultures.
Credit Suisse analyst Kevin McVeigh initiated coverage of Alight, Inc. (NYSE:ALIT) on August 16 with an Outperform rating and a $15 price target. The analyst believes Alight, Inc. (NYSE:ALIT) offers a “unique opportunity at an attractive entry level for an accelerating organic growth story-fueled by higher-growth analytics-leveraging datasets”.
According to the Q3 database of elite hedge funds maintained by Insider Monkey, 42 funds were bullish on Alight, Inc. (NYSE:ALIT), with collective stakes amounting to $1.27 billion. FPR Partners is the biggest Alight, Inc. (NYSE:ALIT) stakeholder as of the close of the third quarter of 2021, with 18.5 million shares worth $212.8 million.
You can also take a look at Top 10 Stock Picks of NewGen Asset Management and 10 New Stock Picks of Brian Higgins’ King Street Capital.
