In this article, we discuss 5 stocks to buy now according to Wayne Yu’s BCK Capital. If you want to read our detailed analysis of Yu’s history, investment philosophy, and hedge fund performance, go directly to 10 Stocks to Buy Now According to Wayne Yu’s BCK Capital.
5. SPX FLOW, Inc. (NYSE:FLOW)
BCK Capital Stake Value: $5,475,000
Percentage of BCK Capital’s 13F Portfolio: 3.68%
Number of Hedge Fund Holders: 27
SPX FLOW, Inc. (NYSE:FLOW) provides process solutions for the nutrition, health, and industrial industries. Julian Mitchell, a Barclays analyst, boosted his price objective on SPX FLOW, Inc. (NYSE:FLOW) to $86 from $75 on January 4 and maintained an Equal Weight rating on the stock, citing his expectation that inflation will improve sales for multi-industry firms in Q4.
On February 10, SPX FLOW, Inc. (NYSE:FLOW) reported an EPS of $0.20 for the fiscal fourth quarter of 2021, falling short of estimates by $0.02. On the other hand, the company’s revenue for the quarter came in at $983.49 million, missing market estimates by $7.63 million.
BCK Capital holds 63,312 shares in SPX FLOW, Inc. (NYSE:FLOW) as of Q4 2021, valued at $5.48 million. The company accounts for 3.68% of the hedge fund’s 13F portfolio. Of the 27 hedge funds that were bullish on SPX FLOW, Inc. (NYSE:FLOW), Ian Simm’s Impax Asset Management is the leading stakeholder of the company, holding 1.61 million shares worth over $139.62 million.
Diamond Hill Capital, an investment management firm, in its third-quarter 2021 investor letter mentioned SPX FLOW, Inc. (NYSE:FLOW). Here is what the fund said:
“On an individual holdings’ basis, top contributors to return included SPX Flow. SPX Flow, a manufacturer of industrial flow control systems such as pumps, valves and mixers, benefited from news it had been approached by Ingersoll Rand about a possible acquisition. SPX rejected the proposal but is reviewing its strategic options, including interest from two other potential buyers. To us, this is a sign the market still undervalues this quality business but other strategic buyers see the value we do. We are confident management will either hold out for a price reflective of long-term intrinsic value or continue to execute as a standalone company, growing intrinsic value at an attractive rate for years to come.”
4. Cerner Corporation (NASDAQ:CERN)
BCK Capital Stake Value: $6,723,000
Percentage of BCK Capital’s 13F Portfolio: 4.52%
Number of Hedge Fund Holders: 36
Cerner Corporation (NASDAQ:CERN) provides health information technology services, systems, and hardware in the United States. Following reports of Oracle Corporation (NYSE:ORCL)’s plans to acquire Cerner Corporation (NASDAQ:CERN), KeyBanc analyst Donald Hooker downgraded the stock to Sector Weight from Overweight on December 21.
Wayne Yu’s BCK Capital added Cerner Corporation (NASDAQ:CERN) to its portfolio in the fourth quarter of 2021, buying 72,391 shares. At the end of the third quarter of 2021, 36 hedge funds in the database of Insider Monkey held stakes valued at $1.28 billion in Cerner Corporation (NASDAQ:CERN), down from 38 the preceding quarter totaling $1.39 billion.
Cooper Investors, in its first-quarter 2021 investor letter, discussed its stance on Cerner Corporation (NASDAQ:CERN). Here is what the fund said:
“The investment in Cerner, made just over a year ago, was based on what we perceived to be a Low-Risk Turnaround opportunity as a refreshed management team sought to increase margins, reduce capex and utilise balance sheet latency with buybacks and acquisitions. Taking account of the tough 2020 for Cerner’s hospital client base the company did a reasonable job executing on these initiatives. However, moving into 2021 more recent observations around intentionality and focus led to a reassessment of the investment proposition, particularly relative to the portfolio’s other technology and software investments.”
3. Xilinx, Inc. (NASDAQ:XLNX)
BCK Capital Stake Value: $9,977,000
Percentage of BCK Capital’s 13F Portfolio: 6.71%
Number of Hedge Fund Holders: 62
Xilinx, Inc. (NASDAQ:XLNX) is a company that designs and develops programmable logic semiconductor devices, as well as the software design tools that go with them. On February 14, Advanced Micro Devices, Inc. (NASDAQ:AMD) announced that it had completed its all-stock acquisition of Xilinx, Inc. (NASDAQ:XLNX).
Truist analyst William Stein boosted his price objective for Xilinx, Inc. (NASDAQ:XLNX) to $190 from $180 on January 27, but maintained a Hold recommendation on the stock. On January 26, Xilinx, Inc. (NASDAQ:XLNX) issued a quarterly dividend of $0.37 per share, in line with the previous.
As of the end of the third quarter, 62 hedge funds in Insider Monkey’s database of 867 funds held stakes in Xilinx, Inc. (NASDAQ:XLNX), up from 59 funds in the second quarter.
2. Nuance Communications, Inc. (NASDAQ:NUAN)
BCK Capital Stake Value: $10,011,000
Percentage of BCK Capital’s 13F Portfolio: 6.74%
Number of Hedge Fund Holders: 61
Nuance Communications, Inc. (NASDAQ:NUAN) provides conversational artificial intelligence and ambient clinical intelligence services. Nuance Communications, Inc. (NASDAQ:NUAN), on February 7, posted earnings for the fourth quarter of 2021, reporting a revenue of $321.4 million, down 7.1% YoY.
Matthew Halbower’s Pentwater Capital Management is one of the leading Nuance Communications, Inc. (NASDAQ:NUAN) stakeholders as of Q4 2021, with 17.34 million shares worth $959.25 million. BCK Capital holds 180,973 shares in Nuance Communications, Inc. (NASDAQ:NUAN), worth over $10 million, representing 6.74% of its investment portfolio. The hedge fund has increased its Nuance Communications, Inc. (NASDAQ:NUAN) stake by 23% in the fourth quarter.
Overall, at the end of Q3, 61 hedge funds tracked by Insider Monkey held stakes in Nuance Communications, Inc. (NASDAQ:NUAN) valued at $4.87 billion, down from 72 funds in Q2.
Rhizome Partners mentioned Nuance Communications Inc. (NASDAQ: NUAN) in its third-quarter 2021 investor letter. Here is what the firm said:
“We also exited our small position in Nuance upon Microsoft’s acquisition. Nuance is a leader in voice recognition software, with dominant market share, and its speech-to-text product is the gold standard in radiology. In addition, by eliminating the need for note taking and allowing doctors to focus on patient care, Nuance could transform the way doctors treat patients. We built a 1% position in Nuance after attending its comprehensive investor day. Our view is that if Nuance can successfully grow its voice-recognition software in doctor’s offices, it could be worth multiples of our cost basis. Microsoft’s acquisition eliminated the multi-bagger upside but also partially validates the belief that Nuance is a high-quality technology company. We exited Nuance with a 62% gain in less than a year. This example is representative of the slight adjustments we made to our portfolio construction. We will allocate to small bets on technology and high-growth companies that could increase our exposure to “right tail” upside. Rest assured that our focus is still roughly 50% real estate, 30% high-quality companies trading at cheap multiples of free cash flow, and the rest in investments with the potential for growth and higher upside.”
1. IHS Markit Ltd. (NYSE:INFO)
BCK Capital Stake Value: $16,839,000
Percentage of BCK Capital’s 13F Portfolio: 11.34%
Number of Hedge Fund Holders: 64
IHS Markit Ltd. (NYSE:INFO) is a globally diversified information, analytics, and solutions company. Based on its 13F holdings for the fourth quarter of 2021, BCK Capital owns 126,686 shares in IHS Markit Ltd. (NYSE:INFO), a position valued at $16.84 million.
On January 24, BMO Capital analyst Jeffrey Silber lowered his price target on IHS Markit Ltd. (NYSE:INFO) to $118 from $142 and kept a Market Perform rating on the shares. Silber told investors that his lower target price reflected S&P Global Inc. (NYSE:SPGI)’s estimated takeover value, which is likely to conclude this quarter.
Overall, hedge funds are loading up on IHS Markit Ltd. (NYSE:INFO), as 64 out of the 867 funds tracked by Insider Monkey held stakes in the company, up from 61 funds a quarter earlier.
In their first quarter investor letter, Artisan Partners mentioned IHS Markit Ltd. (NYSE:INFO) in their first-quarter investor letter. Here is what Artisan Partners stated about IHS Markit Ltd. (NYSE:INFO):
“We ended our campaign in IHS Markit. IHS Markit is a global provider of information services to the financial services, automotive and energy sectors. Since beginning our investment campaign in 2009, we have been attracted to the company’s position relative to the meaningful secular tailwind driving demand for data and analytics to help guide business decisions. The company announced in Q4 it is merging with S&P Global, one of the largest credit ratings agencies globally and a provider of benchmarks, data and analytics to the global capital and commodities markets. We believe the combination provides a good level of cost and revenue synergies which will help drive profit growth, and S&P Global has a solid track record of acquiring and integrating new businesses. However, we exited our position as the combined entity will be well beyond our mid-cap market cap mandate.”
You can also take a peek at Top 10 Stocks to Buy According to John Orrico’s Water Island Capital and Top 10 Stock Picks of Samuel Isaly’s OrbiMed Advisors.
