Billionaire Dan Loeb’s Portfolio: Top 5 Stock Picks

In this article, we will take a look at billionaire Dan Loeb’s portfolio: top 5 stock picks. To know more about the top stocks in Loeb’s portfolio, go directly to Billionaire Dan Loeb’s Portfolio: Top 12 Stock Picks.

5. Bath & Body Works, Inc. (NYSE:BBWI)

Third Point’s Stake Value: $468.13 Million
Percent of Portfolio: 7.1%
Number of Hedge Fund Holders: 49

Bath & Body Works, Inc. (NYSE:BBWI) is a specialty retailer of home fragrance, body care, and soaps. The company commercialize its products through the retail store and e-commerce sites. 

While Bath & Body Works, Inc. (NYSE:BBWI) is down by about 23% for the year, it offers an enticing 2.45% dividend yield, ideal for generating passive income. Third Point opened a position in Bath & Body Works, Inc. (NYSE:BBWI) in Q3 2022 at the height of the bear run. Third Point held stakes worth $468.13 million in the company in Q3 2023, accounting for 7.1% of the portfolio. 

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4. Amazon.com, Inc. (NASDAQ:AMZN)

Third Point’s Stake Value: $594.92 Million
Percent of Portfolio: 9.02%
Number of Hedge Fund Holders: 286

Amazon.com, Inc. (NASDAQ:AMZN) is an online retailer that connects merchants and consumers worldwide.

At the end of September 2023, Third Point had a stake in Amazon.com, Inc. (NASDAQ:AMZN) worth $594.92 million. According to securities filings, it owned 4.68 million shares of Amazon.com, Inc. (NASDAQ:AMZN), which comprised 9.02% of its portfolio. The stock is up by about 28% since Loeb started investing in the second quarter, affirming its status as one of Dan Loeb’s top stock picks. 

Polen Global Growth shared its views on Amazon.com, Inc. (NASDAQ:AMZN) in its investor letter for Q3 2023:

“Amazon continues to showcase it’s place as one of the most competitively advantaged companies in the world. The company has made significant progress in managing costs and better leveraging existing capacity, driving a strong recovery in its profitability. We think there’s additional room for improvement.

AWS growth seems to be stabilizing even while management continues to work with clients to optimize their infrastructure spend. Roughly 90% of global IT spending remains on premise. We believe this will eventually flip, with most IT spending ultimately moving to the cloud over time. We think AWS will be a significant beneficiary of this transition.

Further, our investment case on company profitability driven by AWS and advertising continues to unfold, delivering nearly $8 billion in free cash flow over the trailing twelve months and a net margin of 5%. We expect both to move higher with the mix shift of more profitable businesses growing fastest continuing to take effect.

At Amazon’s current price, we believe the company is well positioned to deliver a mid-teens or higher total shareholder return for our clients over the next five plus years without a Herculean effort from the business. It simply needs to continue executing on current businesses and growing into the capacity it built during and immediately after the pandemic.”

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3. Danaher Corporation (NYSE:DHR)

Third Point’s Stake Value: $607.85 Million
Percent of Portfolio: 9.21%
Number of Hedge Fund Holders: 103

According to recent filings, Third Point held 2.76 million shares of Danaher Corporation (NYSE:DHR) as of the end of the third quarter of 2023, valued at $607.85 million, accounting for 9.21% of the portfolio.

Baron Health Care Fund said the following about Danaher Corporation (NYSE:DHR) in its Q3 2023 investor letter:

“We added to Danaher Corporation (NYSE:DHR), which recently completed the spinoff of its non-life sciences businesses to become a pure-play life sciences tools company. Although near-term trends in the bioprocessing market remain challenging, we like the long-term growth drivers in this business and think Danaher is well positioned.”

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2. Microsoft Corporation (NASDAQ:MSFT)

Third Point’s Stake Value: $702.54 Million
Percent of Portfolio: 10.65%
Number of Hedge Fund Holders: 306

Microsoft Corporation (NASDAQ:MSFT) is another major technology firm renowned for its suite of software solutions that include Office, exchange, SharePoint, Microsoft Teams, office 365 Security and Compliance, Microsoft Viva, and Microsoft 365 Copilot. Microsoft Corporation (NASDAQ:MSFT) also operates in the cloud computing segment and gaming industry through the Xbox console.

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1. PG&E Corporation (NYSE:PCG)

Third Point’s Stake Value: $917.15 Million
Percent of Portfolio: 13.91%
Number of Hedge Fund Holders: 49

PG&E Corporation (NYSE:PCG) provides electricity and natural gas to customers in California. It has pipelines and storage facilities for natural gas. PG&E Corporation (NYSE:PCG) also generates electricity using nuclear, hydroelectric, fossil fuel-fired, fuel cell, and photovoltaic sources. 

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Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily newsletter to get  the latest investment ideas from hedge funds’ investor letters by entering your email address below. You can also check out our articles on 15 Stocks under $50 to Buy and Hold Forever and Billionaire Daniel Sundheim’s D1 Capital Portfolio: Top 12 Stock Picks.