In this article, we discuss 10 finance stocks that billionaire David Harding is buying. If you want to see his top 5 finance picks, click Billionaire David Harding is Buying These 5 Finance Stocks.
David Harding is the billionaire portfolio manager of Winton Capital Management, a London-based hedge fund he founded in 1997. Winton Capital Management is a $1.65 billion hedge fund with investment strategies rooted in empirical research, quantitative methods, and statistical studies to detect and beat stock market patterns and predictive signals.
David Harding is a Cambridge University graduate, with an investment career that dates back to 30 years. Although his hedge fund lost billions in value amid the pandemic-driven 2020 and 2021, he remains consistent with his strategy, and is quietly confident about the future outlook of Winton Capital Management.
Winton Capital Management’s fourth quarter portfolio is concentrated in the finance, information technology, healthcare, consumer discretionary, and materials sectors. David Harding’s hedge fund is particularly keen on the finance industry, as 23.15% of the total stocks owned by the fund belong to the sector.
With the top ten holdings comprising 14.40% of the total portfolio, David Harding’s fund purchased 257 new stocks in Q4 2021, discarded 583 securities, reduced holdings in 362, and made additional purchases in 364 previously held companies. Some of the most notable stocks in the billionaire’s Q4 portfolio include Microsoft Corporation (NASDAQ:MSFT), Exxon Mobil Corporation (NYSE:XOM), and Alphabet Inc. (NASDAQ:GOOG), in addition to others discussed in detail ahead.
David Harding of Winton Capital Management
Our Methodology
We used David Harding’s Winton Capital Management portfolio for the fourth quarter of 2021 to shortlist his top 10 finance stocks for the period.
Billionaire David Harding is Buying These Finance Stocks
10. New York Community Bancorp, Inc. (NYSE:NYCB)
Winton Capital Management’s Stake Value: $3,156,000
Percentage of Winton Capital Management’s 13F Portfolio: 0.19%
Number of Hedge Fund Holders: 30
New York Community Bancorp, Inc. (NYSE:NYCB) operates as the bank holding company for New York Community Bank that offers annuities, insurance products, mutual funds, cash management, and online banking services to customers in New York, New Jersey, Ohio, Florida, and Arizona.
Securities filings for Q4 2021 reveal that billionaire David Harding’s hedge fund owned 258,514 shares of New York Community Bancorp, Inc. (NYSE:NYCB), worth $3.15 million, representing 0.19% of the total 13F holdings. David Harding boosted his New York Community Bancorp, Inc. (NYSE:NYCB) stake by 49% in the quarter ending December 2021.
On January 26, New York Community Bancorp, Inc. (NYSE:NYCB) declared a quarterly dividend per share of $0.17, in line with previous. The dividend was paid on February 17, for shareholders of record on February 7. New York Community Bancorp, Inc. (NYSE:NYCB)’s dividend yield on April 14 stood at 6.75%.
Riley analyst Steve Moss on April 12 maintained a Buy recommendation on New York Community Bancorp, Inc. (NYSE:NYCB) but lowered the firm’s price target on the shares to $16 from $19. The analyst contended that Q1 results for the fintech sector should be strong owing to loan growth, higher net interest margins, and a positive NIM outlook given the Fed’s March 2022 rate hike. However, the near-term upside to bank earnings is likely to occur at the expense of growth and credit costs in the long run, the analyst added.
Among the hedge funds tracked by Insider Monkey at the end of December 2021, 30 funds were bullish on New York Community Bancorp, Inc. (NYSE:NYCB), compared to 27 funds in the earlier quarter. The total stakes owned in Q4 amounted to $455.8 million. Ryan Tolkin’s Schonfeld Strategic Advisors held the biggest position in the company, with 5.90 million shares worth $72 million.
In addition to Microsoft Corporation (NASDAQ:MSFT), Exxon Mobil Corporation (NYSE:XOM), and Alphabet Inc. (NASDAQ:GOOG), New York Community Bancorp, Inc. (NYSE:NYCB) is a notable stock to consider according to David Harding’s hedge fund.
9. KeyCorp (NYSE:KEY)
Winton Capital Management’s Stake Value: $3,258,000
Percentage of Winton Capital Management’s 13F Portfolio: 0.19%
Number of Hedge Fund Holders: 30
KeyCorp (NYSE:KEY) is a holding company for KeyBank National Association, which is a regional Cleveland-based retail bank serving small and enterprise businesses, as well as investment clients. David Harding’s Winton Capital Management increased its KeyCorp (NYSE:KEY) stake by 680% in Q4 2021, holding 140,845 shares worth $3.25 million.
KeyCorp (NYSE:KEY) declared on January 13 a $0.195 per share quarterly dividend. The dividend was distributed on March 15. KeyCorp (NYSE:KEY)’s dividend yield on April 14 came in at 3.80%.
On April 11, Wells Fargo analyst Mike Mayo double upgraded KeyCorp (NYSE:KEY) to Overweight from Underweight, raising the price target to $27 from $23. KeyCorp (NYSE:KEY) shares have declined 24% from its year-to-date high, which seems to reflect a possibly weak Q1. However, the analyst told investors that this metric fails to acknowledge the traditional banking growth and risk avoidance at large banks. He believes that estimated NII will increase 20% over 3 years, or 3-times faster than the estimated increase in NCOs. He also expects 30% extra upside to earnings per share and the stock if KeyCorp (NYSE:KEY) regains its 2018 NIM.
According to Insider Monkey’s Q4 data, KeyCorp (NYSE:KEY) was found in the stock portfolios of 30 hedge funds, who held collective stakes in the company worth $308 million. Richard S. Pzena’s Pzena Investment Management is the largest position holder in the company, with 2.8 million shares valued at $65.3 million.
8. Synchrony Financial (NYSE:SYF)
Winton Capital Management’s Stake Value: $3,390,000
Percentage of Winton Capital Management’s 13F Portfolio: 0.20%
Number of Hedge Fund Holders: 34
Synchrony Financial (NYSE:SYF) was founded in 1932 and is headquartered in Stamford, Connecticut. As a consumer financial services company, Synchrony Financial (NYSE:SYF) offers expertise in credit cards, commercial credit solutions, consumer installment loans, certificates of deposit, individual retirement accounts, money market accounts, and savings accounts.
In the fourth quarter of 2021, Winton Capital Management owned 73,077 shares of Synchrony Financial (NYSE:SYF), worth $3.39 million, representing 0.20% of the hedge fund’s total 13F holdings. David Harding’s fund increased its stake in Synchrony Financial (NYSE:SYF) by 51% in Q4.
On April 6, Wells Fargo analyst Donald Fandetti maintained an Overweight rating on Synchrony Financial (NYSE:SYF) but lowered the firm’s price target on the shares to $45 from $52. The analyst reiterated his Q1 EPS estimate of $1.45, but he reduced his 2022 and 2023 EPS projections by $0.20 each to $5.65 and $5.70 respectively, to account for increased provision expense assumptions amid the uncertain macro backdrop.
Peter Rathjens, Bruce Clarke, and John Campbell’s Arrowstreet Capital is the biggest stakeholder of Synchrony Financial (NYSE:SYF), with 11.76 million shares worth $545.6 million. Overall, 34 hedge funds placed long calls on Synchrony Financial (NYSE:SYF) at the end of December 2021.
7. JPMorgan Chase & Co. (NYSE:JPM)
Winton Capital Management’s Stake Value: $3,454,000
Percentage of Winton Capital Management’s 13F Portfolio: 0.20%
Number of Hedge Fund Holders: 107
JPMorgan Chase & Co. (NYSE:JPM) is a New York-based multinational investment bank and financial services company. The company provides an array of financial services including commercial banking, asset management, commodities, credit cards, equities trading, insurance, investment management, mortgage loans, mutual funds, private equity, risk management, and wealth management.
Securities filings for the December quarter reveal that David Harding’s Winton Capital Management held 21,810 shares of JPMorgan Chase & Co. (NYSE:JPM), worth $3.45 million, representing 0.20% of the hedge fund’s total 13F securities. David Harding boosted his JPMorgan Chase & Co. (NYSE:JPM) stake by 492% in Q4 2021.
JPMorgan Chase & Co. (NYSE:JPM) posted its Q1 2022 financial results on April 13, announcing earnings per share of $2.63, missing analysts’ estimates by $0.08. The $30.72 billion revenue outperformed market consensus by $318.51 million.
On March 15, JPMorgan Chase & Co. (NYSE:JPM) declared a $1.00 per share quarterly dividend. The dividend is payable on April 30, to shareholders of the company as of April 6. JPMorgan Chase & Co. (NYSE:JPM)’s dividend yield on April 14 stood at 3.19%.
RBC Capital analyst Gerard Cassidy reiterated an Outperform rating on JPMorgan Chase & Co. (NYSE:JPM) but lowered the firm’s price target on the shares to $155 from $175 on April 14. JPMorgan Chase & Co. (NYSE:JPM)’s core EPS of $2.76 missed his estimate of $2.81 because of larger than projected loan loss provision and increased expenses, although these were partially compensated by higher net interest income, the analyst told investors. He added that while the majority of JPMorgan Chase & Co. (NYSE:JPM)’s primary businesses announced decent results, he sees capital ratio concerns impacting share price.
According to Insider Monkey’s Q4 data, 107 hedge funds held long positions in JPMorgan Chase & Co. (NYSE:JPM), up from 101 funds in the earlier quarter. Ken Fisher’s Fisher Asset Management is the biggest stakeholder of the company, with 7.4 million shares worth $1.17 billion.
Here is what Ariel Investments has to say about JPMorgan Chase & Co. (NYSE:JPM) in its Q4 2021 investor letter:
“In our view, inflation will not just be a 2021 phenomenon. Inflationary expectations are only now working themselves into the labor market with historically low unemployment, resurgent labor unions, and higher wages. These labor cost pressures are only starting to show up in the Consumer Price Index. The most recent Producer Price Index showed a +9% year over year increase, the highest since it was created in 2010. Higher input prices generally lead to rising consumer prices.
“In our view, inflation will not just be a 2021 phenomenon.”
Consumer balance sheets are in excellent shape with lower unemployment and banked stimulus checks. A recent analysis from JP Morgan Chase (JPM) showed average checking accounts have 50% higher balances than pre-Covid. The U.S. money supply as measured by M2 (a calculation that includes cash, checking accounts, and “near cash” such as money market securities) is up +38% versus year-end 2019. Higher consumer cash holdings and higher money supply mean more spending and demand for goods. Some emphasize supply issues to explain current inflation. Going forward, we see very strong demand as well, too much money chasing too few goods.”
6. Interactive Brokers Group, Inc. (NASDAQ:IBKR)
Winton Capital Management’s Stake Value: $3,905,000
Percentage of Winton Capital Management’s 13F Portfolio: 0.23%
Number of Hedge Fund Holders: 42
Interactive Brokers Group, Inc. (NASDAQ:IBKR) is a Connecticut-based digital brokerage that allows online trading of stocks, options, futures, currencies, bonds, and funds. David Harding’s Winton Capital Management owns 49,173 shares of Interactive Brokers Group, Inc. (NASDAQ:IBKR) as of Q4 2021, worth $3.90 million. The hedge fund elevated its stake in the company by 43% in the fourth quarter.
In 2021, Interactive Brokers Group, Inc. (NASDAQ:IBKR)’s revenue for the year came in at $2.75 billion, compared to $2.2 billion in 2020. The net income in 2021 grew approximately 58% from the prior-year, reaching $308 million.
On January 19, Keefe Bruyette analyst Kyle Voigt upgraded Interactive Brokers Group, Inc. (NASDAQ:IBKR) to Outperform from Market Perform with an unchanged price target of $90. The analyst cited valuation for the upgrade, in light of the stock’s recent underperformance. He also raised estimates after Interactive Brokers Group, Inc. (NASDAQ:IBKR)’s Q4 results were published, noting moderately higher trading activity, increased fees and services revenue, and reduced execution costs.
According to Insider Monkey’s hedge fund database, Interactive Brokers Group, Inc. (NASDAQ:IBKR) was found in the portfolios of 42 elite funds at the end of December 2021, up from 31 funds in the prior quarter. Select Equity Group is the leading stakeholder of the company, with a position worth over $453 million.
Interactive Brokers Group, Inc. (NASDAQ:IBKR) is one of the finance stocks that billionaire David Harding is buying, and his Q4 portfolio also consists of other famous names like Microsoft Corporation (NASDAQ:MSFT), Exxon Mobil Corporation (NYSE:XOM), and Alphabet Inc. (NASDAQ:GOOG).
Here is what TGV Partners Fund has to say about Interactive Brokers Group, Inc. (NASDAQ:IBKR) in its Q4 2021 investor letter:
“Interactive Brokers has had a very good year operationally. In the Corona year 2020, Interactive Brokers was swamped with customers like most other online brokers. Due to the lockdown from March that year, the number of customers in 2020 increased by over + 50 %. Most market observers expected this influx of customers to calm down after the lockdowns in 2020 and return to a more normal growth path. With around 1.67 million customers, Interactive Brokers now had 56 % more customers by the end of the year than the previous year, and there was little sign of a decline in customer influx even up to December 2021. Since the business model is a very fixed-cost business in the form of a software platform and every new customer is incrementally very valuable, this is fantastic news.”
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Disclosure: None. Billionaire David Harding is Buying These 10 Finance Stocks is originally published on Insider Monkey.
