In this article, we discuss the top 5 stock picks of billionaire Daniel Sundheim’s D1 Capital Partners. If you want to see more top holdings of the hedge fund, check out Billionaire Daniel Sundheim’s D1 Capital Portfolio: Top 10 Stock Picks.
5. Warby Parker Inc. (NYSE:WRBY)
D1 Capital’s Stake Value: $505,257,000
Percentage of D1 Capital’s 13F Portfolio: 5.94%
Number of Hedge Fund Holders: 18
Warby Parker Inc. (NYSE:WRBY) is a New York-based company that sells eyeglasses, sunglasses, and contact lenses, as well as related accessories. On June 27, Loop Capital analyst Anthony Chukumba lowered the price target on Warby Parker Inc. (NYSE:WRBY) to $15 from $18 and maintained a Hold rating on the shares. The analyst cited soaring inflation and shaken consumer confidence while slashing his FY22 revenue outlook to $625.8 million from $639.3 million.
Daniel Sundheim’s D1 Capital Partners boosted its Warby Parker Inc. (NYSE:WRBY) stake by 12% in Q1 2022, holding about 15 million shares worth $505.25 million, representing 5.94% of the total securities.
According to Insider Monkey’s data, 18 hedge funds were long Warby Parker Inc. (NYSE:WRBY) at the conclusion of the first quarter of 2022, up from 15 funds in the preceding quarter. Henry Ellenbogen’s Durable Capital Partners is a significant shareholder of the company, with 14.80 million shares worth $500.6 million.
Here is what Polen U.S. Small Company Growth Fund has to say about Warby Parker Inc. (NYSE:WRBY) in its Q4 2021 investor letter:
“Warby Parker is a New York-based direct to-consumer eyewear retailer with a unique, vertically integrated business model that significantly reduces cost and customer friction. In an industry that has historically relied on price increases ahead of inflation to supplement volume growth, many incumbents have been left with bloated cost structures and channel conflicts that interfere with digitizing their businesses. Warby Parker was launched to take advantage of this opportunity and has been rewarded with rapid growth since its founding in 2010, while still being in the very early stages of penetrating the multi-billion dollar prescription eyewear market. We expect the company to build intrinsic value, with robust growth for the foreseeable future as it continues to gain market share.”
4. Amazon.com, Inc. (NASDAQ:AMZN)
D1 Capital’s Stake Value: $646,882,000
Percentage of D1 Capital’s 13F Portfolio: 7.61%
Number of Hedge Fund Holders: 271
Amazon.com, Inc. (NASDAQ:AMZN) is one of the most influential technology firms in the world. On July 15, after the company posted strong Prime Day sales, Morgan Stanley analyst Brian Nowak reiterated a “Buy” rating on shares and assigned a $175 price target. Similarly, Bank of America analyst Justin Post also maintained a “Buy” rating on Amazon.com, Inc. (NASDAQ:AMZN) shares with a $188 price target. Barclays analyst Ross Sandler was bullish on the stock t00, reaffirming a Buy rating and a $195 price target.
Daniel Sundheim’s D1 Capital portfolio had 198,433 Amazon.com, Inc. (NASDAQ:AMZN) shares in the first quarter of 2022, worth $646.8 million, representing 7.61% of the total 13F holdings.
Among the hedge funds tracked by Insider Monkey, 271 funds were bullish on Amazon.com, Inc. (NASDAQ:AMZN) at the end of March 2022, compared to 279 funds in the preceding quarter. Ken Fisher’s Fisher Asset Management featured as a prominent shareholder of the company, with 2.3 million shares worth $7.70 billion.
Here is what Diamond Hill Large Cap Fund has to say about Amazon.com, Inc. (NASDAQ:AMZN) in its Q1 2022 investor letter:
“Amazon, one of the leading providers of public cloud services and online retailing, is a rapidly growing business that has been investing heavily in infrastructure and content to improve its customer experience. These investments have obscured the magnitude of sustainable free cash flow as well as the attractive valuation of the business relative to peers.”
3. Rivian Automotive, Inc. (NASDAQ:RIVN)
D1 Capital’s Stake Value: $783,291,000
Percentage of D1 Capital’s 13F Portfolio: 9.22%
Number of Hedge Fund Holders: 29
Rivian Automotive, Inc. (NASDAQ:RIVN) is a California-based electric vehicle manufacturer that offers a range of pickup trucks and sports utility vehicles. In Q1 2022, D1 Capital Partners held about 15.6 million Rivian Automotive, Inc. (NASDAQ:RIVN) shares, worth $783.2 million, representing 9.22% of the total portfolio.
Canaccord Genuity on July 13 initiated coverage on Rivian Automotive, Inc. (NASDAQ:RIVN) with a Buy rating and a $61 price target. Analyst George Gianarikas issued the rating and presented a robust defense of the stock’s upside potential. The analyst told investors that Rivian Automotive, Inc. (NASDAQ:RIVN) has what it takes to become a leader in the EV and mobility space.
According to Insider Monkey’s data, 29 hedge funds were long Rivian Automotive, Inc. (NASDAQ:RIVN) at the end of Q1 2022, with combined stakes worth about $4 billion. This is comparable to 47 hedge funds holding stakes in Rivian Automotive, Inc. (NASDAQ:RIVN) valued at more than $9 billion in the prior quarter. Philippe Laffont’s Coatue Management held the biggest position in the company, comprising roughly 31 million shares worth $1.5 billion.
Here is what Baron Global Advantage Fund has to say about Rivian Automotive, Inc. (NASDAQ:RIVN) in its Q1 2022 investor letter:
“Rivian Automotive, Inc. designs, manufactures, and sells consumer and commercial electric vehicles. Shares of Rivian continued its volatile trading following the stock’s IPO in late 2021, declining 52% in the first quarter as investors rotated out of fast-growing long-duration stocks and as industry wide supply-chain issues delayed Rivian’s production ramp. In addition, even while other automotive companies raised prices due to inflationary pressures, Rivian launched a price increase campaign that was not well communicated and, as a result, was met with dissatisfaction by existing reservation holders. While this was an unforced error, the company quickly corrected course, reversing its decision to raise prices for existing reservations, while maintaining the increase on new buyers (which has not caused a material impact to demand). We retain conviction in the shares given management’s vision, Rivian’s product positioning, the company’s relationship with Amazon.com, and the company’s strong balance sheet, which will help it overcome the current challenges while taking advantage of the long-term opportunity as the market transitions to electric vehicles.”
2. Microsoft Corporation (NASDAQ:MSFT)
D1 Capital’s Stake Value: $1,055,288,000
Percentage of D1 Capital’s 13F Portfolio: 12.42%
Number of Hedge Fund Holders: 259
Billionaire Daniel Sundheim’s D1 Capital boosted its Microsoft Corporation (NASDAQ:MSFT) stake by 36% in Q1 2022, holding 3.4 million shares worth $1.05 billion, representing 12.42% of the total 13F portfolio. Daniel Sundheim first invested in Microsoft Corporation (NASDAQ:MSFT) back in Q1 2020.
On June 13, Netflix, Inc. (NASDAQ:NFLX) announced that it had partnered with Microsoft Corporation (NASDAQ:MSFT) to be its global advertising sales and technology partner, as Netflix moves to provide an ad-supported tier.
In the first quarter of 2022, Microsoft Corporation (NASDAQ:MSFT) was part of 259 hedge fund portfolios, compared to 262 funds in the previous quarter. Arrowstreet Capital held a significant position in the company, with 17.3 million shares worth $5.3 billion.
Here is what Carillon Clarivest Capital Appreciation Fund has to say about Microsoft Corporation (NASDAQ:MSFT) in its Q1 2022 investor letter:
“Stock selection contributed the most while sector allocation was also positive. An underweight to communication services and an overweight to energy helped performance, while an underweight to consumer staples and an overweight to materials detracted. Stock selection was strong within healthcare and materials but was weak within information technology and industrials. Microsoft (NASDAQ:MSFT) reported positive results driven by personal computing strength, but analysts were especially positive on its growth outlook for its Azure cloud-computing services.”
1. Expedia Group, Inc. (NASDAQ:EXPE)
D1 Capital’s Stake Value: $1,489,566,000
Percentage of D1 Capital’s 13F Portfolio: 17.54%
Number of Hedge Fund Holders: 88
Expedia Group, Inc. (NASDAQ:EXPE) is an online travel company operating in the United States and internationally. The company’s brand portfolio primarily includes Expedia, Vrbo, Orbitz, Travelocity, CheapTickets, Hotwire, CarRentals.com, Classic Vacations, and Expedia Cruise.
Securities filings for Q1 2022 reveal that Daniel Sundheim’s D1 Capital owned 7.6 million Expedia Group, Inc. (NASDAQ:EXPE) shares, worth about $1.5 billion, representing 17.54% of the total 13F holdings. Expedia Group, Inc. (NASDAQ:EXPE) has been part of Sundheim’s portfolio since Q2 2020.
On July 14, investment advisory Truist reiterated a Buy rating on Expedia Group, Inc. (NASDAQ:EXPE) but lowered the price target on the stock to $185 from $240. The firm noted that near-term travel demand remains robust but the rampant inflation and currency moves reflect a weaker demand environment heading into 2023. The analyst believes that Expedia Group, Inc. (NASDAQ:EXPE) shares are “attractively valued”.
According to Insider Monkey’s Q1 data, Expedia Group, Inc. (NASDAQ:EXPE) was part of 88 hedge fund portfolios, up from 82 funds in the earlier quarter. PAR Capital Management is a prominent shareholder of the company, with 4.10 million shares worth $802.2 million.
Here is what Aristotle Focus Growth Fund has to say about Expedia Group, Inc. (NASDAQ:EXPE) in its Q1 2022 investor letter:
“Expedia outperformed in the first quarter following a better-than-expected earnings report for the company’s fourth quarter of 2021. During the pandemic, the company reduced expenses which has improved operating leverage as revenue recovers. Expectations for travel in 2022 have improved as COVID cases have declined.”
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