Below is the list of 5 stocks to sell according to Motley Fool. For a detailed discussion about Motley Fool’s investment philosophy and portfolio management strategies please see 10 Stocks to Sell According to Motley Fool.
5. Corning Incorporated (NYSE:GLW)
Number of Hedge Fund Holders: 40
Motley Fool first initiated a position in Corning Incorporated (NYSE:GLW) in 2018 and sold out of it completely during the September quarter. Shares of Corning surged sharply in 2020 and hit 52-week highs during the first half of 2021. Corning is engaged in optical communications, specialty materials, display technologies, life sciences businesses, and environmental technologies.
Corning was in 40 hedge funds’ portfolios as of the end of September compared to 42 positions in the previous quarter according to data tracked by Insider Monkey.
4. Cummins Inc. (NYSE:CMI)
Number of Hedge Fund Holders: 30
Motley Fool also took advantage of the sharp stock price rally of Cummins Inc. (NYSE:CMI) in the past two years. The firm exited its stake in the company during the September quarter when its stock was trading close to $250. It is a mid-cap industrial company engaged in developing engines, power systems, and related components for machinery and heavy trucks.
Several other hedge funds also sold off their stakes in the company after its shares hit an all-time high during the first half of 2021. As of the end of September, Cummins was in 30 hedge funds’ 13F portfolios. Beech Hill Partners was among the leading stakeholders in the company.
3. Editas Medicine, Inc. (NASDAQ:EDIT)
Number of Hedge Fund Holders: 22
Editas Medicine, Inc. (NASDAQ:EDIT) is among the stocks to sell according to Motley Fool. The firm first initiated a position in Editas Medicine, Inc. (NASDAQ:EDIT) in the final quarter of 2018 and sold out its entire stake in the company during the September quarter of 2021 when its shares were trading above the $50 level. The move appears to be well-times as the stock price of Editas Medicine, Inc. (NASDAQ:EDIT) tumbled sharply in the December quarter and has extended that downtrend into 2022.
The number of long hedge fund bets on Editas decreased by 1 in Q3, as Editas Medicine, Inc. (NASDAQ:EDIT) was in 22 hedge funds’ portfolios at the end of the third quarter of 2021. Although Motley Fool sold out its entire stake in the company, several popular hedge funds such as Catherine D. Wood’s ARK Investment Management and Two Sigma Advisors were still bullish about Editas Medicine, Inc. (NASDAQ:EDIT).
2. Proto Labs, Inc. (NYSE:PRLB)
Number of Hedge Fund Holders: 17
Proto Labs, Inc. (NYSE:PRLB) is on the list of stocks to sell according to Motley Fool. The firm exited its position in Proto Labs during the September quarter amid the company’s stock price falling almost 80% in the past 12 months. It is an e-commerce-driven digital manufacturer of on-demand production parts and custom prototypes.
As of the end of September, the number of long hedge funds’ positions fell to 17 from 18 in the previous quarter. Catherine D. Wood’s ARK Investment Management was the leading stakeholder in the company.
1. Alibaba Group Holding Limited (NYSE:BABA)
Number of Hedge Fund Holders: 115
Alibaba Group Holding Limited (NYSE:BABA) has been among the poorest performers over the past 12 months due to regulatory issues. Besides regulatory concerns, analysts like Stifel’s Scott Devitt trimmed their price targets for Alibaba amid concerns over slowing revenue growth.
In its fourth quarter investor letter, Aikya Investment Management, an asset management firm, mentioned a few stocks, including Alibaba. Here is what Aikya Investment Management declared:
“Most investors looking to invest in high quality and sustainable businesses in Emerging Markets start their assessment by analyzing the franchise and the financial statements – but often miss the risks associated with questionable stewardship. For example:
Alibaba was widely understood to be a high-quality and sustainable company, with the appearance of a business that empowered SME merchants while generally contributing to technology and financial infrastructure in China. Its dominant e-commerce franchise delivered healthy ROEs for several years, to the contentment of investors. We believe that the competitive advantage was explained mostly by the management’s early links to the Shanghai faction of the CCP. As the political winds have changed, the business has proven to be less resilient than first perceived.”
You can also take a look at the Top 10 Stock Picks of Samuel Isaly’s OrbiMed Advisors and the 10 Best Dividend Stocks According to Tiger Cub Rob Citrone.
