In this article, we discuss the top 5 stock picks of activist billionaire Paul Singer for 2023. If you want to see more stocks in this selection, check out Activist Billionaire Paul Singer 2023 Portfolio: Top 10 Stock Picks.
5. Peabody Energy Corporation (NYSE:BTU)
Elliott Management’s Stake Value: $540,411,059
Number of Hedge Fund Holders: 39
Peabody Energy Corporation (NYSE:BTU) is involved in the coal mining industry. The company’s operations are divided into different segments such as Seaborne Thermal Mining, Seaborne Metallurgical Mining, Powder River Basin Mining, and Other U.S. Thermal Mining. In Q1 2023, Peabody Energy Corporation (NYSE:BTU) was one of the top stock picks of activist Paul Singer. The billionaire owned 21.10 million shares of the company worth $540.4 million.
On May 1, B. Riley analyst Lucas Pipes maintained a Buy rating on Peabody Energy Corporation (NYSE:BTU), although the price target for the company’s shares has been revised from $39 to $29 following the Q1 results. The analyst lowered his estimates to align with a dull thermal coal price outlook.
According to Insider Monkey’s first quarter database, 39 hedge funds were bullish on Peabody Energy Corporation (NYSE:BTU), compared to 40 funds in the prior quarter. Paul Marshall and Ian Wace’s Marshall Wace LLP is a prominent stakeholder of the company.
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4. Pinterest, Inc. (NYSE:PINS)
Elliott Management’s Stake Value: $761,174,557
Number of Hedge Fund Holders: 66
Pinterest, Inc. (NYSE:PINS) functions as a visual discovery platform worldwide. The company’s platform enables users to discover ideas, ranging from recipes to home decor and fashion inspiration, among others. It offers features such as video, product, and idea pins, while also providing tools for organizing and planning purposes. In Q1 2023, Paul Singer held approximately 28 million shares of Pinterest, Inc. (NYSE:PINS) worth $761 million, representing 5.63% of the total 13F securities.
On May 2, Loop Capital analyst Rob Sanderson maintained a Buy rating on Pinterest, Inc. (NYSE:PINS) but lowered the firm’s price target on the shares to $28 from $32. According to the analyst, Pinterest, Inc. (NYSE:PINS) had a good performance in the first quarter and provided cautious guidance. The 19% drop in the stock price is seen as a correction in valuation due to lower-than-expected results, rather than any significant issues with Pinterest, Inc. (NYSE:PINS)’s operations, as per Sanderson. Loop Capital also highlighted that investors are becoming increasingly aware of the distinctiveness of Pinterest, Inc. (NYSE:PINS) platform and its potential for generating revenue.
According to Insider Monkey’s first quarter database, 66 hedge funds were long Pinterest, Inc. (NYSE:PINS), compared to 61 funds in the earlier quarter. Harris Associates is a prominent stakeholder of the company, with 18.3 million shares worth $500 million.
TimesSquare U.S. Mid Cap Growth Strategy made the following comment about Pinterest, Inc. (NYSE:PINS) in its Q4 2022 investor letter:
“Slightly countering that decline was the 4% gain for Pinterest, Inc. (NYSE:PINS), an image-based social media company. The company posted better-than-expected third quarter results and forward guidance was in line with Street estimates. Pinterest expects significant margin improvement after a relatively heavy investment cycle.”
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3. Howmet Aerospace Inc. (NYSE:HWM)
Elliott Management’s Stake Value: $1,045,516,739
Number of Hedge Fund Holders: 42
Howmet Aerospace Inc. (NYSE:HWM) offers innovative engineered solutions for the aerospace and transportation sectors worldwide. The company operates through four main segments – Engine Products, Fastening Systems, Engineered Structures, and Forged Wheels. Securities filings for Q1 2023 reveal that Paul Singer owned 24.6 million shares worth over $1 billion. While Howmet Aerospace Inc. (NYSE:HWM) is one of the top stock picks of the activist, he trimmed 29% of his stake in the March quarter.
On May 9, BofA analyst Ronald Epstein raised the firm’s price target on Howmet Aerospace Inc. (NYSE:HWM) to $52 from $45 and kept a Buy rating on the shares. This decision comes after Howmet Aerospace Inc. (NYSE:HWM) announced a robust quarter with impressive revenue and earnings per share, and also revised its outlook for fiscal year 2023 upwards. While there may be some uncertainty in the short term regarding aircraft production rates, the firm believes that Howmet Aerospace Inc. (NYSE:HWM) will still experience positive effects from the growing demand in defense and the overall recovery in commercial air traffic.
According to Insider Monkey’s first quarter database, 42 hedge funds were long Howmet Aerospace Inc. (NYSE:HWM), compared to 35 funds in the prior quarter. William B. Gray’s Orbis Investment Management is a prominent stakeholder of the company.
Oakmark Equity and Income Fund made the following comment about Howmet Aerospace Inc. (NYSE:HWM) in its Q1 2023 investor letter:
“During the quarter, we eliminated three positions: Howmet Aerospace Inc. (NYSE:HWM), Keurig Dr Pepper and LivaNova. Howmet performed well and reached our sell target. This is our second successful investment with CEO John Plant, whom we rank among the top CEOs.”
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2. Marathon Petroleum Corporation (NYSE:MPC)
Elliott Management’s Stake Value: $1,491,893,950
Number of Hedge Fund Holders: 58
Marathon Petroleum Corporation (NYSE:MPC) is an integrated downstream energy company that operates in the United States. The company functions in two main segments, Refining & Marketing and Midstream. In Q1 2023, Paul Singer’s Elliott Management owned 11 million shares of Marathon Petroleum Corporation (NYSE:MPC), worth about $1.5 billion and representing 11.04% of the total 13F securities.
On May 19, Nitin Kumar, an analyst at Mizuho, maintained a Buy rating on Marathon Petroleum Corporation (NYSE:MPC) but adjusted the firm’s target price to $148 from $160. In a research note to investors, the analyst explained that the recent decline in the U.S. oil and gas sector’s stock prices contradicts the messaging conveyed by individual companies. According to Kumar, oil and gas producers emphasized their focus on capital discipline, cash returns, and improving service costs during the first quarter. On the other hand, refiners highlighted improved physical market conditions. Mizuho stated that the sector’s valuations are currently disconnected from both historical levels and other market sectors. Mizuho expressed a more positive outlook for gas-focused exploration and production companies, anticipating a potential turnaround in U.S. gas prices in the second half of 2023. However, it adopts a more cautious stance towards U.S. refiners.
According to Insider Monkey’s first quarter database, 58 hedge funds were long Marathon Petroleum Corporation (NYSE:MPC), compared to 52 funds in the prior quarter. Cliff Asness’ AQR Capital Management is a prominent stakeholder of the company.
Here is what Clark Street Value has to say about Marathon Petroleum Corporation (NYSE:MPC) in its Q4 2021 investor letter:
“During the worst of covid, I bought some LEAPs on Marathon Petroleum (MPC) as a proxy for Par Pacific (PARR) since long dated options weren’t available on the later. Those MPC calls expire next month and I’ll take profits, with PARR I’ve reduced my position throughout the year and might sell the rest early next year, I’ve owned it for 6-7 years and it has gone nowhere, they haven’t touched the NOLs, just a difficult business that I probably don’t understand as well as I should.”
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1. Triple Flag Precious Metals Corp. (NYSE:TFPM)
Elliott Management’s Stake Value: $2,012,085,173
Number of Hedge Fund Holders: 14
Triple Flag Precious Metals Corp. (NYSE:TFPM) specializes in streaming and royalty contracts related to gold and silver. It acquires and manages streams and royalties associated with precious metals in Australia, Canada, Colombia, Mongolia, Peru, South Africa, and the United States. In Q1 2023, Paul Singer increased his stake in Triple Flag Precious Metals Corp. (NYSE:TFPM) by 4%, holding 134.5 million shares of the company worth over $2 billion.
On May 1, Stifel started coverage of Triple Flag Precious Metals Corp. (NYSE:TFPM) with a Buy rating and set a price target of C$27. The firm stated in a research note that Triple Flag Precious Metals Corp. (NYSE:TFPM) is a significant player in the precious metals royalty/streaming sector, highlighting its strong growth in attributable gold equivalent ounce production.
According to Insider Monkey’s first quarter database, 14 hedge funds were long Triple Flag Precious Metals Corp. (NYSE:TFPM), up from 8 funds in the preceding quarter.
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