In this article, we will discuss the 5 new stocks in Kamyar Khajavi’s MIK Capital portfolio. If you want to read our detailed analysis of Kamyar Khajavi’s history, investment philosophy, and hedge fund performance, go directly to the 10 New Stocks in Kamyar Khajavi’s MIK Capital Portfolio.
5. Chipotle Mexican Grill, Inc. (NYSE:CMG)
MIK Capital’s Stake Value: $8,868,000
Percentage of MIK Capital’s 13F Portfolio: 4.5%
Number of Hedge Fund Holders: 35
Chipotle Mexican Grill, Inc. (NYSE:CMG), an American chain of restaurants, was founded by Steve Ells in 1993. Headquartered in Newport Beach, California, Chipotle serves Mexican food at over 2,700 branches spread not only across the US but in Canada, UK, France, and Germany as well. Brian Niccol is the current CEO and Chairman of the company.
In the Q2 2021 investor letter of Pershing Square Holdings, the fund mentioned Chipotle Mexican Grill, Inc. (NYSE: CMG). Here is what the fund said:
“Chipotle’s track record of superb performance has continued in 2021, driven by ongoing strength in digital sales and a recovery of in-store ordering. Digital gains achieved during the pandemic have proven resilient, with digital sales growing 11% in Q2 compared with the prior year, highlighting the limited overlap with in-person occasions. The company has now recovered about 70% of its pre-pandemic in-restaurant sales volumes, with the opportunity to drive these sales meaningfully higher once more schools and workplaces reopen after Labor Day. Near-term performance is accelerating, with management forecasting same-store sales growth from 2019 levels in the low- to mid-20% range in Q3, up from 18% growth last quarter.
In May, Chipotle announced that they would increase hourly wages to a national average of $15 by the end of June, and advertised a path for a new employee to earn an annual income of $100,000 in as little as three and a half years. This resonated extremely well with existing and prospective employees, with staffi ng levels now above 2019 levels following some previously pronounced labor shortages that limited sales. Chipotle increased menu prices by 3.5% and 4.0% to cover the wage increase, and has not seen any customer resistance, demonstrating the signifi cant pricing power enabled by Chipotle’s brand strength and attractive customer value proposition…” (Click here to see the full text)
4. United Rentals, Inc. (NYSE:URI)
MIK Capital’s Stake Value: $8,903,000
Percentage of MIK Capital’s 13F Portfolio: 4.51%
Number of Hedge Fund Holders: 47
Based out of Stamford, Connecticut, United Rentals, Inc. (NYSE:URI) was founded 24 years ago in 1997. It is the largest equipment rentals company, serving almost all of North America as well as 4 European countries with an overall equipment cost of $14.2 billion. United Rentals provides equipment rentals in different specialty fields such as trench safety, power, and HVAC, tool solutions, fluid solutions, onsite services, radio services, drone services as well as sports and entertainment.
In the second quarter ended June 30, MIK Capital owned 27,908 shares worth $8.9 million. This represents 4.51% of the hedge fund’s overall holdings. According to Insider Monkey’s data, the number of hedge funds that held stakes in United Rentals, Inc. (NYSE:URI) increased from 41 out of 866 in Q1 to 47 out of 873 in Q2.
Carillon Tower Advisers talked about United Rentals, Inc. (NYSE: URI) in their Q1 2021 investor letter. Here is what the fund said:
“United Rental is an equipment rental company that primarily services construction and industrial companies, as well as manufacturers, utilities, homeowners, municipalities, and other government entities. The firm performed well in the first quarter as the company is a clear beneficiary of both a strengthening economy as well as a possible infrastructure bill. United Rentals’ business model performed exceptionally well in 2020 as the company generated substantial free cash flow by aggressively scaling back its capital expenditures. In 2021, we believe the company should be able to push its rental rates higher following a year of disciplined fleet management across the entire equipment rental industry. Additionally, the entire rental industry should benefit from tightness throughout the machinery sector as manufacturers struggle to meet demand due to supply chain constraints.”
3. Amazon.com, Inc. (NASDAQ:AMZN)
MIK Capital’s Stake Value: $9,443,000
Percentage of MIK Capital’s 13F Portfolio: 4.79%
Number of Hedge Fund Holders: 271
In the second quarter, MIK Capital owned 2,745 shares in Amazon.com, Inc. (NASDAQ:AMZN), amounting to $9.4 million. Out of the hedge funds listed in Insider Monkey’s database, 271 out of 873 held stakes in the company in Q2, up from 243 out of 866 in the previous quarter.
On October 7, Cowen analyst John Blackledge maintained an Outperform rating on the shares while lowering the firm’s price target from $4,400 to $4,300.
In the Q2 2021 investor letter of ClearBridge Investments, the fund mentioned Amazon.com, Inc. (NASDAQ: AMZN). Here is what the fund said:
“The Strategy’s goal of generating strong risk-adjusted performance while investing in companies that can make a positive impact on society and the environment is often supported by holdings that are companies with significant customer bases, making our engagements with them effective platforms for driving change. This is the case with new holding Amazon.com, the leading retail e-commerce site and provider of web hosting and related cloud services that continues to benefit from the migration of commerce from offline to online. We initiated a position in Amazon based on its strength in several areas, including retail, its Amazon Web Services cloud business and advertising; from a valuation perspective, Amazon has become more attractive as profitability has improved and the stock has gone sideways in an up market.
ClearBridge has been holding interactive engagements with Amazon on several ESG issues for several years, including labor and environmental issues, and we have seen improvements over that time. From a sustainability perspective, Amazon has made meaningful ESG commitments and improved labor practices and it faces fewer regulatory issues than many large tech peers. Labor management remains a key focal point and the company has made increased commitments to its labor force, including in December 2018, when Amazon increased its minimum wage standard to $15 an hour in the U.S., well above the federal minimum wage standard. Amazon is also taking steps toward environmental sustainability that would put it ahead of peers if goals are achieved. In June 2019, Amazon set new targets to be carbon neutral by 2040 and to use 100% renewable energy by 2030…” (Click here to see the full text)
2. Kohl’s Corporation (NYSE:KSS)
MIK Capital’s Stake Value: $9,590,000
Percentage of MIK Capital’s 13F Portfolio: 4.86%
Number of Hedge Fund Holders: 40
Headquartered in Wisconsin, Kohl’s is a renowned departmental store retail chain. Having started as a corner grocery shop back in 1927 by Polish immigrant Maxwell Kohl, it has come a long way. Kohl’s Corporation (NYSE:KSS) now has over 1,100 retail stores spread across 49 states with a huge market cap of $6.91 billion.
As of Q2 2021, MIK Capital held 174,008 shares of the company worth $9.59 million, making up 4.86% of the fund’s overall 13F portfolio. A total of 40 out of 873 hedge funds tracked by Insider Monkey held shares in Kohl’s Corporation (NYSE:KSS) in Q2 as compared to 35 out of 866 in Q1.
Frederick Disanto’s Ancora Advisors is the biggest stakeholder in Kohl’s Corporation with a total investment worth $192.5 million.
1. Thomson Reuters Corporation (NYSE:TRI)
MIK Capital’s Stake Value: $10,838,000
Percentage of MIK Capital’s 13F Portfolio: 5.5%
Number of Hedge Fund Holders: 27
Thomson Reuters Corporation (NYSE:TRI) is a Canadian multinational media giant. In 2008, Reuters Group was acquired by Thomson Corporation following which the company was named Thomson Reuters and operated under a dual-listed company structure.
In the second quarter of 2021, MIK Capital owned 109,120 shares of Thomson Reuters Corporation (NYSE:TRI) worth $10.8 million, representing 5.5% of the fund’s portfolio. As of the second quarter of 2021, 27 hedge funds out of the 873 tracked by Insider Monkey held stakes in the Thomson Reuters Corporation (NYSE:TRI). In the previous quarter, the number of hedge funds that owned shares in the company stood at 28 out of the total 866.
On October 6, TD Securities analyst Vince Valentini kept the price target for Thomson Reuters Corporation (NYSE:TRI) unchanged at $127.5 (C$160) while upgrading the rating from Hold to Buy.
You can also take a look at 10 Stocks Making Moves on Quarterly Results and 10 Stocks to Buy in 2021 According to Carl Tiedemann’s TIG Advisors.
