In this article, we discuss 5 stocks to buy according to Don Morgan’s Brigade Capital. If you want to read a detailed analysis of Morgan’s investment philosophy and current portfolio allocation strategies, go directly to 10 Stocks to Buy According to Don Morgan’s Brigade Capital.
5. Chesapeake Energy Corporation (NASDAQ:CHK)
Brigade Capital’s Stake Value: $9,406,000
Percentage of Brigade Capital’s 13F Portfolio: 1.05%
Number of Hedge Fund Holders: 67
Chesapeake Energy Corporation (NASDAQ:CHK), an independent exploration and production firm, acquires, explores, and develops assets in the United States to produce oil, natural gas, and natural gas liquids from subterranean reservoirs. Chesapeake Energy Corporation (NASDAQ:CHK) stands fifth on the list of Don Morgan’s Brigade Capital.
Benchmark analyst Subash Chandra initiated coverage of Chesapeake Energy Corporation (NASDAQ:CHK) on August 1, assigning the stock a ‘Buy’ rating and a $137 price target. Brigade Capital owns 115,975 shares in Chesapeake Energy Corporation (NASDAQ:CHK) worth over $9.41 million, representing close to 1.05% of its Q2 portfolio.
67 hedge funds from the second quarter database of Insider Monkey reported long bets on Chesapeake Energy Corporation (NASDAQ:CHK), with combined stakes worth $3.53 billion. One of the firm’s notable shareholders is Oaktree Capital Management, which held a $851.64 million position.
In its Q1 2022 investor letter, ClearBridge Investments mentioned Chesapeake Energy Corporation (NASDAQ:CHK). Here is what the fund said:
“In the early days of the invasion, we made two measured changes to the portfolio based on longer-term fallout we anticipate from Russia’s invasion of Ukraine. First, we initiated small positions in U.S. natural gas producers Chesapeake (NYSE:CHK) …. (Click here to read full text).”
4. Bowlero Corp. (NYSE:BOWL)
Brigade Capital’s Stake Value: $9,531,000
Percentage of Brigade Capital’s 13F Portfolio: 1.06%
Number of Hedge Fund Holders: 18
Bowlero Corp. (NYSE:BOWL) is a media company and owner of bowling alleys that offer cuisine, entertainment, and bowling. In the second quarter of 2022, 18 hedge funds were long Bowlero Corp. (NYSE:BOWL), with a total stake value of $203.96 million. Brigade Capital trimmed its stake in Bowlero Corp. (NYSE:BOWL) by 7% in the second quarter, ending the period with shares worth $9.53 million.
Kevin Heenan, an analyst at JPMorgan, commenced coverage of Bowlero Corp. (NYSE:BOWL) on August 30, assigning the stock an ‘Overweight’ rating and a $17 price target. In a research report, Heenan disclosed to investors that Bowlero Corp. (NYSE:BOWL) held market dominance and leverage in the lucrative bowling sector.
3. Noble Corporation (NYSE:NE)
Brigade Capital’s Stake Value: $17,118,000
Percentage of Brigade Capital’s 13F Portfolio: 1.91%
Number of Hedge Fund Holders: 31
Noble Corporation (NYSE:NE) is an offshore drilling business with its main office in London, United Kingdom. It has a fleet of 20 offshore drilling units operating as of February 16, 2022, including 12 floaters and 8 jackups. On July 6, DNB Markets analyst Martin Huseby Karlsen reaffirmed a ‘Buy’ rating on Noble Corporation (NYSE:NE) and increased his price objective from $43 to $49.
Noble Corporation (NYSE:NE), in which Brigade Capital increased its position by 222% in Q2 2022, is ranked third on Don Morgan’s list of ten stocks to purchase. The hedge fund holds 675,270 shares in Noble Corporation (NYSE:NE) worth over $17.12 million, representing 1.91% of its portfolio.
31 hedge funds held stakes in Noble Corporation (NYSE:NE) in the second quarter of 2022, collectively worth $457.57 million, compared to the same number of funds in the preceding quarter, holding stakes in Noble Corporation (NYSE:NE) valued at $621.73 million.
2. Magnachip Semiconductor Corporation (NYSE:MX)
Brigade Capital’s Stake Value: $18,768,000
Percentage of Brigade Capital’s 13F Portfolio: 2.1%
Number of Hedge Fund Holders: 27
Magnachip Semiconductor Corporation (NYSE:MX) develops and manufactures analogue and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computer, industrial, and automotive applications. Rajvindra Gill, a Needham analyst, expressed his optimism for Magnachip Semiconductor Corporation (NYSE:MX) on August 10. He maintained a ‘Buy’ rating and a $22 price target on the stock.
On September 6, Magnachip Semiconductor Corporation (NYSE:MX) unveiled its third-generation 200V MV Metal-Oxide-Semiconductor Field-Effect Transistors for industrial power supplies and motor controllers for Light Electric Vehicles.
Toronado Partners is a prominent stakeholder of Magnachip Semiconductor Corporation (NYSE:MX), with 2.57 million shares of the company, worth over $37.39 million. Even after selling 7,624 shares of Magnachip Semiconductor Corporation (NYSE:MX) in the second quarter, Don Morgan’s Brigade Capital holds more than 1.29 million shares of the company, worth about $18.77 million.
Insider Monkey found 27 hedge funds bullish on Magnachip Semiconductor Corporation (NYSE:MX) at the close of the second quarter of 2022. These funds held collective stakes in the company valued at $210.85 million, down from $252.98 million in the first quarter of 2022, when 28 hedge funds were long Magnachip Semiconductor Corporation (NYSE:MX).
Here is what Altron Capital Management had to say about Magnachip Semiconductor Corporation (NYSE:MX) in its Q4 2021 investor letter:
“MagnaChip Semiconductor Corp. (NYSE:MX). While the previous buyout offer from Wise Road Capital did not go through as many expected, the company is still in talks with other potential buyers. Furthermore, the company announced a USD 75 million share buyback, which represents a significant percentage of the company’s shares. While we do not generally enter positions with the anticipation of a buyout, it is the case that a MagnaChip acquisition will be the most likely outcome.”
1. Valaris Limited (NYSE:VAL)
Brigade Capital’s Stake Value: $25,922,000
Percentage of Brigade Capital’s 13F Portfolio: 2.9%
Number of Hedge Fund Holders: 40
Valaris Limited (NYSE:VAL) is an offshore contract drilling firm that provides services to the global oil and gas industry. According to the 13F filings for the second quarter of 2022, Brigade Capital held over 613,690 shares of Valaris Limited (NYSE:VAL), amounting to more than $25.92 million and representing 2.9% of the fund’s portfolio. Valaris Limited (NYSE:VAL) has featured on Morgan’s portfolio since the second quarter of 2021.
As of the end of the second quarter of 2022, 40 hedge funds had ownership positions in Valaris Limited (NYSE:VAL), up from 39 hedge funds a quarter earlier. Magnetar Capital, with a nearly $953.61 million stake, is a significant shareholder of Valaris Limited (NYSE:VAL).
You can also take a peek at 10 Stocks to Buy According to Kevin McCarthy’s Breakline Capital and 10 Stocks to Buy According to Mark McMeans’ Brasada Capital Management.
