In this article, we discuss 5 stocks US politicians bought before Russia’s attack on Ukraine. If you want to see more stocks in this selection, click 10 Stocks US Politicians Bought Before Russia’s Attack on Ukraine.
5. Chevron Corporation (NYSE:CVX)
Number of Hedge Fund Holders: 53
Chevron Corporation (NYSE:CVX) has perhaps been one of the top gainers in the energy sector since Russia invaded Ukraine on February 24, with the stock climbing 24.35% over the last month. Chevron Corporation (NYSE:CVX) operates as a multinational oil and gas company that was founded in 1879 and is based in San Ramon, California.
A Periodic Transaction Report dated February 17 reveals that John Rutherford, a member of the United States House of Representatives from Florida’s 4th congressional district, purchased a stake in Chevron Corporation (NYSE:CVX) worth between $1,001 to $15,000.
On January 26, Chevron Corporation (NYSE:CVX) declared a $1.42 per share quarterly dividend, a 6% increase from its prior dividend of $1.34. The dividend was distributed on March 10, and the stock yields 3.45% as of March 21.
Morgan Stanley analyst Devin McDermott on March 14 downgraded Chevron Corporation (NYSE:CVX) to Equal Weight from Overweight with an unchanged price target of $166. He stated that while Chevron Corporation (NYSE:CVX) shares have gained 46% year-to-date, and roughly 25% in the past month, the valuation is “beginning to look expensive”. He cited that Exxon Mobil Corporation (NYSE:XOM), the closest Chevron peer, has much better prospects.
According to the fourth quarter database of Insider Monkey, 53 hedge funds were bullish on Chevron Corporation (NYSE:CVX), and Berkshire Hathaway is the biggest shareholder of the company. Warren Buffett’s fund owns 38.2 million Chevron Corporation (NYSE:CVX) shares, worth $4.4 billion.
Here is what Goehring & Rozencwajg Associates has to say about Chevron Corporation (NYSE:CVX) in its Q3 2021 investor letter:
“After successfully replacing 25% of Exxon’s board of directors despite owning just 0.02% of the outstanding equity, Engine No. 1, the climate-focused activist hedge fund, met with Chevron’s management late last summer. In discussions that were later described as “cordial,” Chevron executives shared their plan to reduce carbon emissions. Subsequently, Chevron announced new plans to further reduce carbon output, along with their intention to appoint a new director with “environmental expertise.” Although it remains unclear exactly what Engine No. 1 is planning, rumors suggest the fund has contacted other investors, strongly suggesting they intend to launch a second campaign in the not-too-distant future.
What should Chevron expect?
It was recently reported by The Wall Street Journal that Exxon was considering abandoning two massive natural gas projects: the 75 trillion cubic foot (tcf ) Rovuma LNG project (capital cost $30 bn) and the 5 tcf Ca Voi Xanh offshore-Vietnam gas project (capital cost $10 bn). Exxon board members (most likely including the three supported by Engine No. 1) have publicly expressed concerns about both projects. According to internal reports, these projects are among the highest CO2 producers in Exxon’s pipeline; it is no surprise these projects have been called into question. However, we find the plight of both fields to be perplexing since production would almost certainly be used to displace coal in electricity generation, cutting CO2 emissions by nearly 50%. This fact seems to be lost on the new Exxon board members.”
4. McKesson Corporation (NYSE:MCK)
Number of Hedge Fund Holders: 57
McKesson Corporation (NYSE:MCK) is a Texas-based healthcare company involved in the distribution of pharmaceutical drugs, health information technology, and medical equipment. The stock has jumped over the last month, gaining 11.50%.
McKesson Corporation (NYSE:MCK) shares were purchased on February 7 by Lois Frankel, a Democrat who is the United States Representative for Florida’s 21st congressional district. The Period Transaction Report disclosed that Frankel purchased McKesson Corporation (NYSE:MCK) shares valued at between $1,001 and $15,000, with the transaction being publicly declared on February 26.
Publishing its Q4 results on February 2, McKesson Corporation (NYSE:MCK) reported earnings per share of $6.15, above consensus by $0.73. Revenue over the period jumped 9.61% year-over-year to $68.61 billion, outperforming market predictions approximately $2 billion.
On February 8, UBS analyst Kevin Caliendo raised the price target on McKesson Corporation (NYSE:MCK) to $303 from $245 and kept a Buy rating on the shares after its Q4 earnings beat. According to the analyst, a diverse business model, combined with strong cash flow and the company’s edge in oncology and biosimilars positions it for competitive advantage.
A total of 57 hedge funds were long McKesson Corporation (NYSE:MCK) in Q4 2021, up from 51 funds in the prior quarter. Pzena Investment Management is the largest shareholder of the company, owning 2.95 million shares of the company, worth $733.45 million.
Here is what Broyhill Asset Management has to say about McKesson Corporation (NYSE:MCK) in its Q4 2021 investor letter:
“Shares of McKesson tacked on another 23% during the second half. Even after gaining 44% for the full year, the stock still trades at a 50% discount to the market. Like our Dollar Tree investment, investor sentiment around McKesson languished for years as deflating generic drug prices compressed operating margins and the uncertainty of opioid litigation capped valuation multiples. But pricing has stabilized, a global opioid settlement appears imminent, and prescription trends are rapidly recovering at the same time vaccine-related revenues are accelerating.
Since FY19, revenues have grown at 7% annually, driving earnings per share growth, which should shake out at 11% – 14% through FY22. Over this three-year period, McKesson has generated $15 billion in cumulative free cash flow (roughly two-thirds of its market capitalization at the beginning of the period), returning roughly half of that to shareholders through repurchases (shares outstanding have declined by 24% on $6B of buybacks) and dividends (which have increased 22% over this period), while reducing leverage from 2.8x to 1.6x.
Does that sound like a business that should change hands at half the market’s valuation? We don’t think so. Even assuming shares traded back to three-quarters of the market’s multiple (in line with the average of the past decade), shares could return 15% – 20% annually over the next few years.”
3. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders: 62
Broadcom Inc. (NASDAQ:AVGO) is a California-based supplier of semiconductors and relevant infrastructure to global markets. Ro Khanna, the U.S. representative from California’s 17th congressional district, purchased shares of Broadcom Inc. (NASDAQ:AVGO) on February 1. The transaction, disclosed on March 3, was worth between $1,001 and $15,000.
Broadcom Inc. (NASDAQ:AVGO) reported Q4 results on March 3, posting an EPS of $8.39, topping market estimates by $0.24. The fourth quarter revenue jumped 15.79% year-over-year to $7.71 billion, above consensus by $99.60 million.
On March 3, Broadcom Inc. (NASDAQ:AVGO) declared a $4.10 per share quarterly dividend. It is payable on March 31, to shareholders of record on March 22.
Truist analyst William Stein raised the price target on Broadcom Inc. (NASDAQ:AVGO) to $686 from $659 and kept a Buy rating on the shares on March 4. The analyst noted that Broadcom Inc. (NASDAQ:AVGO) delivered another beat in the fourth quarter and in the near-term, sales growth is re-accelerating to 20%, offering “even more confidence”.
According to the Q4 database of Insider Monkey, 62 funds were bullish on Broadcom Inc. (NASDAQ:AVGO), up from 50 funds in the prior quarter. Amid the movement of elite funds in Broadcom Inc. (NASDAQ:AVGO), a significant shareholder of the company was Cantillon Capital Management, with more than 1 million shares worth $669.40 million.
Here is what Richie Capital Group has to say about Broadcom Inc. (NASDAQ:AVGO) in its Q4 2021 investor letter:
“Broadcom (AVGO – up 36.5%) – The semiconductor device manufacturer reported an outstanding Fiscal Q4. Results (and guidance) exceeded Wall Street analyst expectations, and the company raised its dividend by 14% and announced a new stock-repurchase program. Semiconductor related revenue grew 17% while software revenue grew 8%. On the negative side, it was rumored that Apple, their largest customer, is making plans to develop their own wireless chips. This would be a blow to Broadcom. However, AVGO has a $15 billion contract with Apple that is good through 2023 and includes radio frequency parts such as amplifiers, filters and switches.”
2. Block, Inc. (NYSE:SQ)
Number of Hedge Fund Holders: 96
Block, Inc. (NYSE:SQ) is a California-based payments technology company that has climbed close to 44% in the last month, owing to commercial success across its Cash App and strong Q4 results. The company is also making meaningful headway in the crypto space.
James Langevin, the U.S. Representative for Rhode Island’s 2nd congressional district, bought shares of Block, Inc. (NYSE:SQ) on February 2, valued at between $50,001 to $100,000. The transaction was reported on March 4.
On March 11, Mizuho analyst Dan Dolev lowered the price target on Block, Inc. (NYSE:SQ) to $180 from $210 and kept a Buy rating on the shares. The analyst upgraded his Block, Inc. (NYSE:SQ) rating after the company published its Q4 results. He noted that payments stocks appear best positioned within technology to gain in the second half of 2022, as the two-year revenue growth will inflect positively in the coming quarters.
Among the hedge funds tracked by Insider Monkey, ARK Investment Management is one of the leading shareholders of the company, with 6.1 million shares worth approximately $998 million. Overall, 96 hedge funds were bullish on Block, Inc. (NYSE:SQ) at the end of the fourth quarter of 2021.
Here is what Baron FinTech Fund has to say about Block, Inc. (NYSE:SQ) in its Q4 2021 investor letter:
“High exposure to lagging E-commerce companies and underperformance of Block, Inc. (formerly Square, Inc.) in the Payments theme were the only material detractors from relative performance. E-commerce stocks lagged as a return to in-store shopping caused online shopping growth to moderate. Block was the second largest detractor due to slowing growth in the Cash App segment and greater skepticism about the growth prospects for the pending acquisition of Afterpay.”
1. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 110
NVIDIA Corporation (NASDAQ:NVDA) has gained 14.30% in the last month amid the global shortages of semiconductors and chips. NVIDIA Corporation (NASDAQ:NVDA) is a California-based manufacturer of semiconductors, graphics processing units, graphics cards, consumer electronics, video games, and computer hardware.
Walter Schrader, the U.S. representative for Oregon’s 5th congressional district, purchased NVIDIA Corporation (NASDAQ:NVDA) shares on February 22, worth somewhere between $1,001 and $15,000. The transaction was disclosed in a Period Transaction Report dated March 1.
On March 21, BMO Capital analyst Ambrish Srivastava kept an Outperform rating and a $375 price target on NVIDIA Corporation (NASDAQ:NVDA) ahead of its analyst day, noting that the event in the past has served as a positive catalyst for the shares. The analyst expects the company to emphasize on more use cases and customer wins in the Omniverse space.
Elite hedge funds hold large stakes in NVIDIA Corporation (NASDAQ:NVDA). In Q4 2021, 110 funds were bullish on NVIDIA Corporation (NASDAQ:NVDA), up from 83 funds in the earlier quarter. Fisher Asset Management owns a significant stake in the company, with shares worth $1.50 billion.
Here is what Saturna Capital Amana Funds has to say about NVIDIA Corporation (NASDAQ:NVDA) in its Q4 2021 investor letter:
“Concerning the stock market, we avoid short-term predictions. But what of the next decade? A theme since the start of the pandemic has been the big getting bigger. Nvidia carved out a strong business, but we do not view its position as unassailable given evolving markets and capable competitors.”
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