In this article, we present the list of 9 Stocks That Credit Markets Expert Steve Ketchum Likes. You can skip our detailed analysis of Steve Ketchum’s history, investment philosophy, and hedge fund performance and go directly to 5 Stocks That Credit Markets Expert Steve Ketchum Likes.
Steve Ketchum’s Sound Point Capital is a New York-based hedge fund that invests heavily across the capital structure in an effort to capitalize on mispriced assets. That includes investments in corporate bonds and secured bank debt, as well as equity and equity-linked securities. The fund was founded in 2008 by current Managing Partner and Chief Investment Officer Mr. Ketchum, who has nearly three decades worth of experience in the credit markets.
Since its inception in September 2009, the Sound Point Credit Opportunities Fund, LP managed compound annual returns of 3.42% through March 2020. The fund got off to a slow start in the first quarter of 2020, losing 13.96%, which came on the heels of consecutive down years in 2018 and 2019, with losses of 2.13% and 5.62%, respectively. As of November 20, 2021, Sound Point Capital had $17.89 billion in assets under management.
In addition to its plays in the credit markets, Sound Point Capital also maintains a concentrated portfolio of just 9 long positions as of September 30, 2021, according to the fund’s latest 13F filing with the SEC. The fund has primarily gone long on communications stocks in recent quarters and that remained the case at the end of September, with nearly 44% of its $30.87 million 13F portfolios invested in that sector.
Our Methodology
Let’s check out the 9 stocks that credit markets expert Steve Ketchum likes. Note that all hedge fund data is based on the exclusive group of 800+ funds tracked by Insider Monkey as part of our market-beating investment strategy.
Stocks That Credit Markets Expert Steve Ketchum Likes
9. Loral Space & Communications Inc. (NASDAQ:LORL), Acquired by Telesat Corporation (NASDAQ:TSAT)
First up is Loral Space & Communications Inc (NASDAQ:LORL), which hedge funds have soured on quite a bit over the past few years. Hedge fund ownership of the stock has declined by 63% over the past seven years, while during each of the past four quarters just a single one of the hedge funds tracked by Insider Monkey’s database has initiated a position in LORL. During Q3 that hedge fund was Sound Point Capital. The fund bought 11,716 shares, opening a small position that was valued at $504,000 at the end of September.
Loral Space & Communications Inc (NASDAQ:LORL), Telesat, and the Public Sector Pension Investment Board recently completed their merger which was over a year in the making, becoming a leading Canadian satellite communications company. Telesat announced in August that the Canadian government was investing $1.44 billion in the company’s Low Earth Orbit satellite network Telesat Lightspeed in an effort to ensure affordable 5G/LTE service for Canadians.
8. DISH Network Corporation (NASDAQ:DISH)
Sound Point Capital’s DISH Network Corp. (NASDAQ:DISH) holding remained the same during Q3, standing at 13,809 shares valued at $600,000 as of September 30. 53 hedge funds were long DISH Network Corp. (NASDAQ:DISH) at the end of Q3, down from 63 a year earlier.
It was recently reported that DISH Network Corp. (NASDAQ:DISH) and DirecTV have renewed merger discussions, with some believing a tie-up between the two would now pass regulatory scrutiny given the recent struggles and the resulting loss of market share of both companies. DISH Network Corp. (NASDAQ:DISH) lost a net total of 13,000 pay-TV subscribers in the third quarter in addition to bleeding 121,000 net wireless subs. Meanwhile, its EPS of $0.88 missed estimates by $0.03.
ClearBridge Investments, an investment management firm, published its “Large Cap Value Strategy” second quarter 2021 investor letter and mentioned DISH Network Corporation (NASDAQ:DISH). Here‘s what the fund said:
“Portfolio holdings in the communication services and financials sectors also made strong contributions. Dish Network continues to make progress on the buildout of its greenfield 5G network, with Las Vegas slated to become the first market launched later this year. The company gained credibility, and its stock reacted favorably, after it announced a partnership with Amazon to deploy a 5G cloud-native network using AWS’s cloud infrastructure. While the stock has been volatile in recent quarters, we continue to feel confident in Dish’s long-term prospects, which include competing as a fourth U.S. wireless carrier. Charter Communications has been executing well and benefiting from the growth in residential broadband, which has been accelerated by COVID-19 and should see further support from the Biden Administration’s infrastructure bill, which earmarks $65 billion for broadband buildout. In addition, we expect the company to continue to grow its wireless business, leveraging its mobile virtual network operator (MVNO) relationship with Verizon. The company continues to generate strong and growing free cash flow and deploys it toward consistent and material share buybacks.”
7. Clear Channel Outdoor Holdings, Inc. (NYSE:CCO)
Sound Point Capital unloaded 24% of its Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) stake during Q3, selling off 100,000 shares to leave it with 326,189. Hedge funds were big fans of Clear Channel Outdoor Holdings, Inc. (NYSE:CCO)’s initiatives in 2019, as ownership of the stock tripled from Q1 to Q3 of that year. There’s been a 33% decline in hedge fund positions since.
One of the 10 Best Advertising Stocks to Buy Now, the 120-year-old Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) operates over 500,000 marketing displays in the form of billboards, transit displays, information kiosks, and other forms of outdoor and indoor advertising. Clear Channel Outdoor Holdings, Inc. (NYSE:CCO) raised its Q4 revenue guidance in mid-December, projecting that the company pulled in between $730 and $750 million while its liquidity balance is projected to be $25 million higher on both the top and bottom ends.
6. Mudrick Capital Acquisition Corporation II (NASDAQ:MUDS)
Closing out the first half of the list is Mudrick Capital Acquisition Corp II (NASDAQ:MUDS), which Sound Point Capital initiated a position in during Q3, buying 90,000 shares of the blank check company, which completed its $275 million IPO during the quarter. Several other hedge funds took stakes in Mudrick Capital Acquisition Corp II (NASDAQ:MUDS), including Daniel Och’s Sculptor Capital, Robert Henry Lynch’s Aristeia Capital, and James Dondero’s Highland Capital Management.
It was announced back in April that long-time sports card company Topps would be taken public as part of a merger with Mudrick Capital Acquisition Corp II (NASDAQ:MUDS). However, that merger eventually fell through and was mutually terminated after MLB and the MLB Players Association announced that Topps’ deal with the companies would not be extended after it expires in 2025. Mudrick, which was named a long idea by Citron Research a month after its Topps deal was first announced, will now look for another compelling company to join forces with.
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Disclosure: None. 9 Stocks That Credit Markets Expert Steve Ketchum Likes is originally published on Insider Monkey.
