In this article, we discuss 5 new stock picks of Ken Fisher. If you want our detailed analysis of Ken Fisher’s history, investment philosophy, and hedge fund performance, go directly to 10 New Stock Picks of Ken Fisher.
5. XP Inc. (NASDAQ:XP)
Fisher Asset Management’s Stake Value: $14,166,000
Number of Hedge Fund Holders: 28
Headquartered in São Paulo, Brazil, XP Inc. (NASDAQ:XP) is an investment management company specializing in fixed income, investment funds, private pension, wealth management, and related financial services. In Q4 2021, Ken Fisher acquired a position in XP Inc. (NASDAQ:XP), buying 492,906 shares of the company, worth $14.16 million.
On January 11, in its Q4 update, XP Inc. (NASDAQ:XP) reported total assets under custody of R$815 billion as of December 2021, up 23% year-over-year, which was driven by R$230 billion of net inflows and R$75 billion of market depreciation.
XP (NASDAQ:XP) signed a binding agreement on January 7 for merging up to 100% of Banco Modal in exchange for 19.5 million newly issued XP Inc. (NASDAQ:XP) Class A shares or Brazilian Depositary Receipts, marking a 35% premium over Banco Modal’s last 30 days average price.
Citi analyst Gabriel Gusan kept a Neutral rating on XP Inc. (NASDAQ:XP) on October 18 but opened a “30-day positive Catalyst Watch” on the shares. The analyst believes the company “could go back to delivering sound inflows and profitability in the medium term.”
Alkeon Capital Management is the biggest stakeholder of XP Inc. (NASDAQ:XP) as of Q3 2021, with 4.25 million shares worth $171 million. Overall, 28 hedge funds were long XP Inc. (NASDAQ:XP) in the third quarter of 2021, up from 25 funds in the preceding quarter.
4. Ovintiv Inc. (NYSE:OVV)
Fisher Asset Management’s Stake Value: $45,027,000
Number of Hedge Fund Holders: 44
Ovintiv Inc. (NYSE:OVV) is a Colorado-based company engaged in hydrocarbon exploration and production, providing petroleum, natural gas, and natural gas liquids. In the fourth quarter of 2021, Ken Fisher purchased 1.33 million Ovintiv Inc. (NYSE:OVV) shares, worth $45 million, representing 0.02% of the billionaire’s total 13F investments for the period.
On November 2, Ovintiv Inc. (NYSE:OVV) declared a $0.14 per share quarterly dividend, in line with previous. The dividend was paid on December 31, to shareholders of record on December 15.
JPMorgan analyst Arun Jayaram downgraded Ovintiv Inc. (NYSE:OVV) on January 18 to Neutral from Overweight with an unchanged price target of $53. The analyst sees a more balanced risk/reward for the shares relative to the peer group following a 30% move higher over the past month. The downgrade also reflects the analyst’s updated 2022 cash return analysis and his anticipation of an “uncharacteristic” Q4 earnings miss.
In Q3 2021, 44 hedge funds were bullish on Ovintiv Inc. (NYSE:OVV), with stakes totaling $684 million, as compared to 40 funds in the prior quarter, holding stakes in Ovintiv Inc. (NYSE:OVV) worth $739.2 million. Two Sigma Advisors is the largest stakeholder of Ovintiv Inc. (NYSE:OVV) as of the third quarter, with over 3 million shares, valued at $99 million.
Here is what Davis International Fund has to say about Ovintiv Inc. (NYSE:OVV) in their Q4 2020 investor letter:
“Energy holdings in Ovintiv also experienced detracted performance, as oil demand collapsed due to the pandemic. With approximately 70% of oil demand used for transportation, the decline in miles driven (i.e., U.S. miles driven are down 11% in 2020) and the far bigger 60–70% decline in global air passenger traffic led to a dramatic drop in oil prices.
It is our expectation that oil demand will remain weak for the foreseeable future, as flying and driving slowly recover, and that over the long term, electric vehicles and renewable energy will also decrease demand for fossil fuels. As a result, we sold out of our energy positions in 2020. We redeployed the assets in other sectors such as financial services that also saw falling stock prices, but where we had stronger conviction that the long-term health of their business was strong.”
3. Zoom Video Communications, Inc. (NASDAQ:ZM)
Fisher Asset Management’s Stake Value: $418,128,000
Number of Hedge Fund Holders: 56
Zoom Video Communications, Inc. (NASDAQ:ZM) is a California-based communications technology company that offers services including videotelephony, online chat, and business telephone systems.
Billionaire Ken Fisher started building his position in Zoom Video Communications, Inc. (NASDAQ:ZM) in Q3 2020, before discarding his stake entirely in Q3 2021. He purchased Zoom Video Communications, Inc. (NASDAQ:ZM) shares again in Q4 2021, buying a significant position this time. His hedge fund owns 2.27 million shares of Zoom Video Communications, Inc. (NASDAQ:ZM), worth $418.1 million, representing 0.23% of the total 13F portfolio.
On December 30, Citic Securities analyst Junyun Chen initiated coverage of Zoom Video Communications, Inc. (NASDAQ:ZM) with a Buy rating and a $260 price target. The analyst sees an “appealing valuation” at current levels, saying the stock is “oversold” due to the slowdown in sales growth and market concerns over increased competition.
As of Q4 2021, Cathie Wood’s ARK Investment Management holds a prominent stake in Zoom Video Communications, Inc. (NASDAQ:ZM), increasing its position in the company by 57%. ARK Investment Management owns 6.89 million shares of Zoom Video Communications, Inc. (NASDAQ:ZM), worth $1.26 billion.
Here is what Artisan Partners has to say about Zoom Video Communications, Inc. (NASDAQ:ZM) in its Q1 2021 investor letter:
“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 video conferencing’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.”
2. DocuSign, Inc. (NASDAQ:DOCU)
Fisher Asset Management’s Stake Value: $464,854,000
Number of Hedge Fund Holders: 51
DocuSign, Inc. (NASDAQ:DOCU) is a California-based company offering electronic signatures and digital transaction management software and services. Ken Fisher purchased over 3 million DocuSign, Inc. (NASDAQ:DOCU) shares, worth $464.85 million, representing 0.26% of the billionaire’s 13F investments for Q4 2021.
DocuSign, Inc. (NASDAQ:DOCU) published its earnings for the quarter ending October on December 2, posting an EPS of $0.58, beating estimates by $0.12. Revenue over the period jumped 42.45% year-over-year to $545.46 million, surpassing estimates by $14.22 million.
On January 6, Piper Sandler analyst Rob Owens lowered the price target on DocuSign, Inc. (NASDAQ:DOCU) to $175 from $200 and kept a Neutral rating on the shares. Many of the demand drivers that positively impacted cybersecurity spending in 2021 remain in play as we enter 2022, the analyst told investors in a research note.
According to the third quarter database of Insider Monkey, 51 hedge funds were long DocuSign, Inc. (NASDAQ:DOCU), with stakes totaling $4.2 billion, as compared to 58 funds in the quarter earlier, holding stakes in DocuSign, Inc. (NASDAQ:DOCU) worth $4.6 billion. Tiger Global Management is the largest DocuSign, Inc. (NASDAQ:DOCU) stakeholder as of Q3 2021, with 7.30 million shares, valued at $1.88 billion.
Here is what Rowan Street Capital has to say about DocuSign, Inc. (NASDAQ:DOCU) in its Q4 2021 investor letter:
“DocuSign (DOCU)
Finished 2018 with $701 million in revenues; in 2021 they are expected to make $2.1 billion (that’s 3x in just 3 years)
477,000 paying customers at the end of 2018 grew to 1.1 million
Customers spending more than $300k per year increased from 310 to 785 (2.5x growth).
Docusign stock tumbled 42% after it reported in Q3 earnings in the beginning of December, in which it delivered a disappointing Billings outlook as CEO Dan Springer called out a “return to more normalized buying patterns following a stretch of “accelerated growth.” The company was viewed as a hot pandemic play, but recently the market sentiment has shifted to “the slowdown is as a sign a company might have grown too quickly as investors crowded into trades that worked.“
As you can see from the graph below, Docusign stock was trading at ‘peak optimism’ price-to-sales ratio of 35x in the summer of 2020 and has now corrected to a much more reasonable 13x (or 10x expected 2022 sales). Thankfully, our position was insignificant before this correction, and we have been taking advantage of this significant decline in the stock price to build a much larger position, as we expect it to deliver double-digit returns from these price levels over the next 3-5+ years.
Our rationale is simple: despite the recent decline in the valuation, it’s clear that Docusign is still in the early days of its $50 billion Agreement Cloud opportunity as digital transformation remains a high priority for organizations worldwide (our fund is a very happy user of their services). DocuSign is uniquely positioned to lead and capture eSignature and the broader Agreement Cloud market opportunity, given their strong brand leading market position (Docusign has now become a verb) and product differentiation. Even as the pandemic subsides and people begin to return to the office, they are not returning to paper. eSignature and the broader Agreement Cloud are clearly here to stay, and DocuSign’s value proposition will persist no matter how the future of work unfolds.
The huge drop in company stock also triggered the company CEO, Dan Springer to purchase approximately $10 million worth of DOCU stock in the open market. This is the first insider purchase at the company since it went public in April 2018 at $29, and it’s the vote of confidence that we love to see!”
1. Uber Technologies, Inc. (NYSE:UBER)
Fisher Asset Management’s Stake Value: $635,212,000
Number of Hedge Fund Holders: 143
Uber Technologies, Inc. (NYSE:UBER) is an American on-demand mobility service provider, offering services including vehicle for hire, food delivery, package delivery, courier, and freight transport. Ken Fisher headed into 2022 with a newly acquired stake in Uber Technologies, Inc. (NYSE:UBER), worth $635.2 million, representing 0.35% of the billionaire’s 13F securities for the period.
Oppenheimer analyst Jason Helfstein on February 4 lowered the price target on Uber Technologies, Inc. (NYSE:UBER) to $50 from $70 and kept an Outperform rating on the shares, citing lower peer valuation. Uber Technologies, Inc. (NYSE:UBER) looks well poised for 2022, the analyst told investors in a research note, adding that Q4 mobility should exceed expectations.
On January 25, Uber Technologies, Inc. (NYSE:UBER) announced its new partnership with Smart & Final Stores to expand their on-demand and scheduled grocery delivery to customers across the West Coast.
In Q3 2021, 143 hedge funds were bullish on Uber Technologies, Inc. (NYSE:UBER), with collective stakes exceeding $10.76 billion. Altimeter Capital Management held the largest stake in Uber Technologies, Inc. (NYSE:UBER), with 24.50 million shares worth over $1 billion.
Here is what ClearBridge Large Cap Growth Strategy has to say about Uber Technologies, Inc. (NYSE:UBER) in its Q3 2021 investor letter:
“We have also been looking for multi-year secular trends outside of the IT and Internet sectors to help us maintain a portfolio that can perform well in markets with varied sector or factor leadership. In particular, electrification of the global economy and the transition to electric vehicles (EVs) are areas where we continue to add exposure. We are investing in the brains behind EVs through NXP in the control center and Aptiv for safety features. Global rideshare leader Uber will also be a key player in the transition from internal combustion engines to EVs.”
You can also take a look at 9 Latest Stock Picks of Chinese Billionaire Chen Tianqiao’s Shanda Asset Management and Charlie Munger’s Daily Journal Portfolio: Top Stock Picks.
