In this article, we discuss the 5 new stock picks of billionaire Stanley Druckenmiller. If you want to read our detailed analysis of these stocks, go directly to the 10 New Stock Picks of Billionaire Stanley Druckenmiller.
5. Oscar Health, Inc. (NYSE:OSCR)
Number of Hedge Fund Holders: 16
Oscar Health, Inc. (NYSE:OSCR) is a health insurance provider. Regulatory filings show that Duquesne Capital owned 994,289 shares in the company at the end of the third quarter of 2021 worth over $17 million, representing 0.56% of the portfolio.
Morgan Stanley analyst Ricky Goldwasser has an Overweight rating on Oscar Health, Inc. (NYSE:OSCR) stock with a price target of $22. However, the analyst has cautioned investors against contraction among healthcare disruptors in the coming months.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Thrive Capital is a leading shareholder in Oscar Health, Inc. (NYSE:OSCR) with 37 million shares worth more than $654 million.
4. Overstock.com, Inc. (NASDAQ:OSTK)
Number of Hedge Fund Holders: 28
Overstock.com, Inc. (NASDAQ:OSTK) is an online retailer based in Utah. The stock has soared in recent weeks after beating analyst estimates on earnings for the third quarter and the approach of the holiday season when sales traditionally skyrocket.
According to the latest data, Duquesne Capital owned 49,650 shares in Overstock.com, Inc. (NASDAQ:OSTK) at the end of September 2021 worth $3.8 million, representing less than 0.13% of the portfolio of the fund.
At the end of the second quarter of 2021, 28 hedge funds in the database of Insider Monkey held stakes worth $255 million in Overstock.com, Inc. (NASDAQ:OSTK), down from 31 in the previous quarter worth $168 million.
3. Recursion Pharmaceuticals, Inc. (NASDAQ:RXRX)
Number of Hedge Fund Holders:
Recursion Pharmaceuticals, Inc. (NASDAQ:RXRX) is a clinical-stage biotech firm. Securities filings show that Duquesne Capital owned 259,941 shares in the company at the end of the third quarter of 2021 worth $5.9 million, representing 0.19% of the portfolio.
On September 21, investment advisory Berenberg initiated coverage of Recursion Pharmaceuticals, Inc. (NASDAQ:RXRX) stock with a Buy rating and a price target of $37. Analyst Gal Munda issued the ratings update.
Among the hedge funds being tracked by Insider Monkey, New York-based firm Laurion Capital Management is a leading shareholder in Recursion Pharmaceuticals, Inc. (NASDAQ:RXRX) with 3.9 million shares worth more than $90 million.
2. StoneCo Ltd. (NASDAQ:STNE)
Number of Hedge Fund Holders: 44
StoneCo Ltd. (NASDAQ: STNE) is a fintech firm providing services in Brazil. In earnings results for the third quarter, posted in early November, the company reported a revenue of R$1.4 billion, up more than 57% year-on-year.
Duquesne Capital owned 382,100 shares in StoneCo Ltd. (NASDAQ: STNE) at the end of September 2021 worth $13.2 million, representing 0.43% of the portfolio.
At the end of the second quarter of 2021, 44 hedge funds in the database of Insider Monkey held stakes worth $2.7 billion in StoneCo Ltd. (NASDAQ:STNE), up from 39 the preceding quarter worth $2.1 billion.
In its Q2 2021 investor letter, JDP Capital Management, an asset management firm, highlighted a few stocks and StoneCo Ltd. (NASDAQ:STNE) was one of them. Here is what the fund said:
“StoneCo (NYSE: STNE) has been in our portfolio since early 2019 and has appreciated 225% since. In the first half of 2021 the stock was down nearly 20% and was a drag on the fund’s performance.
Stone is a leading fintec company in Brazil that provides back-office software, loans and other financial services to small and medium sized businesses (SMBs). We have discussed Stone in past letters and the company’s “ladder up” from a card processor to a supplier of enterprise software used to sell financial products on top of such as working capital loans.
The company generates a lot of cash that it reinvests to acquire or build new financial products for its customer base. Since we invested, the company has grown the number of SMB clients by 3x, revenue by 2.3x, and net income by 2.2×11.
The pandemic’s impact on SMBs in Brazil has been severe, especially for the many retailers who are only now adopting an e-commerce strategy. In the first half of 2021 Stone increased loss provisions on its lending product, and overall growth has slowed somewhat. The stock’s decline earlier this year was not surprising, but investors are now ignoring progress that has enhanced Stone’s position for coming out much stronger when the recovery begins.
StoneCo Q1 2021 Earnings Call: “Based on (i) our learnings with lockdowns last year, (ii) recent client transactional data and (iii) learnings from the dynamics of countries where vaccines are widespread, we expect that once vaccination scale (which we think will happen in the second half of 2021), the economic recovery will be fast and – although delayed – Brazil is moving in the right direction. For these reasons, we have made an informed decision to be ready for recovery by investing in growth…”
“…In the first quarter, we decided to increase our salesforce headcount by 24%, marketing investments by 33%, customer service and logistics headcount by 32% and technology headcount by 20% in order to be the fastest player when our economy comes back to normal levels.”
“I want to start our presentation by highlighting that Brazil went through a second wave of COVID in the first quarter of ’21, which imposed commerce restrictions in several cities throughout the country. Those restrictions were felt by our clients with average TVP reaching a low in the end of March…
…But similar to the behavior we saw in the comeback from the first lockdown in 2020, we already observed significant and quick recovery with average TPV in May achieving levels above January 2021. As Thiago mentioned, we expect that once vaccinations are scaled, the economy recovery of the country will be fast.”
In terms of COVID recovery opportunities within our portfolio, Stone might be the most “coiled” because the impact on Brazilian small businesses has been so traumatic. In addition, Stone is part of a much larger and fast-moving transition happening in Brazil around the digitalization of financial services. The speed of this transition is unique to Brazil because the Central Bank is actively trying to reduce the country’s previous dependency on a small handful of large banks. Important progress in the first half of 2021 included closing on the long-awaited acquisition of Linx, a mature provider of enterprise software with a large footprint across Brazil. The acquisition will provide Stone meaningful cross-selling opportunities and a more diversified customer base.”
1. Zoom Video Communications, Inc. (NASDAQ:ZM)
Number of Hedge Fund Holders: 59
Zoom Video Communications, Inc. (NASDAQ:ZM) owns and runs a video-first communications platform. At the end of the third quarter of 2021, Duquesne Capital owned 117,690 shares in the company worth $30.7 million, representing 0.99% of the portfolio.
KeyBanc analyst Michael Turits recently upgraded Zoom Video Communications, Inc. (NASDAQ:ZM) stock to Overweight from Sector Weight with a price target of $200, identifying recent dips in share prices as a buying opportunity for investors.
Among the hedge funds being tracked by Insider Monkey, New York-based firm Tiger Global Management LLC is a leading shareholder in Zoom Video Communications, Inc. (NASDAQ:ZM) with 4.2 million shares worth more than $1.6 billion.
In its Q1 2021 investor letter, Artisan Partners, an asset management firm, highlighted a few stocks and Zoom Video Communications, Inc. (NASDAQ:ZM) was one of them. Here is what the fund said:
“We concluded our campaigns in Zoom Video Communications. We have been paring our position in Zoom for several quarters, anticipating the reduced need for video conferencing as vaccination rates climb and people return to their workplaces. That said, we believe there is a strong case to be made that the pandemic has prompted a permanent inflection in videoconferencing’s importance—sustainably higher remote work arrangements, more online learning and less business travel. Furthermore, the company’s dramatically expanded user base (up 485% YoY in Q3) positions it well to cross sell additional services, Zoom Phone in particular. The long-term future remains bright, but we decided to end our successful investment campaign in favor of opportunities in our pipeline with more attractive near-term growth prospects.”
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