In this article, we discuss the 5 stocks that billionaire David Tepper is dumping. If you want to see more stocks that the billionaire discarded, check out Billionaire David Tepper is Dumping These 10 Stocks.
5. Alight, Inc. (NYSE:ALIT)
Number of Hedge Fund Holders: 38
Alight, Inc. (NYSE:ALIT) was founded in 2017 and is headquartered in Lincolnshire, Illinois. The company operates as a cloud-based provider of integrated digital human capital and business solutions worldwide. David Tepper added Alight, Inc. (NYSE:ALIT) to his portfolio in Q3 2021, and dumped his $46.4 million stake in Q1 2022 completely.
JPMorgan analyst Tien-tsin Huang on August 2 initiated coverage of Alight, Inc. (NYSE:ALIT) with an Overweight rating and a $10 price target. The “time is right” for Alight, Inc. (NYSE:ALIT) to monetize its position as the scale platform leader in offering modern benefits programs to businesses, the analyst told investors. Alight, Inc. (NYSE:ALIT) is an essential service provider, and it has “high visibility” to boost revenue at 8% annually to 2025 with double-digit EBITDA growth, added the analyst.
Among the hedge funds tracked by Insider Monkey, 38 funds were bullish on Alight, Inc. (NYSE:ALIT) at the end of Q1 2022, compared to 39 funds in the previous quarter. Bob Peck and Andy Raab’s FPR Partners is the biggest stakeholder of the company, with 25.2 million shares worth $251.3 million.
4. D.R. Horton, Inc. (NYSE:DHI)
Number of Hedge Fund Holders: 52
D.R. Horton, Inc. (NYSE:DHI) is a homebuilding company operating in the United States. Billionaire David Tepper held 1.10 million shares of D.R. Horton, Inc. (NYSE:DHI) in the fourth quarter of 2021, worth $119.2 million, representing 3.06% of the total 13F portfolio. He exited his position completely in the first quarter of 2022.
On July 22, JMP Securities analyst Aaron Hecht lowered the price target on D.R. Horton, Inc. (NYSE:DHI) to $95 from $120 and kept an Outperform rating on the shares. The analyst observed that although Q3 outperformance was supported by higher home prices and larger than anticipated margins, demand significantly dropped in June as interest rates soared. Lower buyer demand led to a FY23 guidance cut, though he still believes that monetizing backlogs will result in D.R. Horton, Inc. (NYSE:DHI) having top-notch corporate structures and normalized ROEs at the conclusion of this cycle, the analyst added.
Among the hedge funds tracked by Insider Monkey, John Armitage’s Egerton Capital Limited is the biggest stakeholder of D.R. Horton, Inc. (NYSE:DHI) as of Q1 2022, with 7.8 million shares worth $582.5 million. Overall, 52 hedge funds were bullish on the stock at the end of March, compared to 54 funds a quarter ago.
Here is what Palm Valley Capital Fund has to say about D.R. Horton, Inc. (NYSE:DHI) in its Q2 2022 investor letter:
“Vidler Water was acquired by homebuilder D.R. Horton (NYSE:DHI) during the second quarter for $15.75 per share, a modest 19% premium to the 90-day volume weighted average price. D.R. Horton can use Vidler’s water rights to satisfy government requirements to have water resources available before it breaks ground on new housing developments in Nevada. The takeover price was below our valuation, but D.R. Horton was the only real buyer who stepped up to the plate for Vidler’s assets. The deal appears to have leaked early, since the stock surged in the weeks before the announcement.”
3. The Mosaic Company (NYSE:MOS)
Number of Hedge Fund Holders: 66
The Mosaic Company (NYSE:MOS) is a Florida-based supplier of concentrated phosphate and potash crop nutrients in North America and internationally. In the first quarter of 2022, David Tepper dumped 66% of his stake in The Mosaic Company (NYSE:MOS). The billionaire held 835,000 shares of the company worth $55.5 million, representing 2.22% of the total Q1 portfolio.
On August 3, Citi analyst P.J. Juvekar upgraded The Mosaic Company (NYSE:MOS) to Buy from Neutral with a price target of $61, up from $57. The analyst thinks agriculture stocks will outperform in a lagging economic environment. The conditions in fertilizers will potentially tighten yet again after the seasonal summer slowdown, especially as the Latin American season arrives in the next few months, the analyst told investors in a research note. The analyst also observed that the Russian-Ukraine war has “upended” agriculture and fertilizer sectors and that the present tightness “is not a one-year fix”. It is likely going to take multiple years to maintain a balance in supply and demand, as per the analyst.
According to Insider Monkey’s data, 66 hedge funds were bullish on The Mosaic Company (NYSE:MOS) at the end of the first quarter of 2022, up from 46 funds in the preceding quarter. Eric W. Mandelblatt’s Soroban Capital Partners is the leading position holder in the company, with roughly 5 million shares worth $328.3 million.
Here is what Carillon Scout Mid Cap Fund has to say about The Mosaic Company (NYSE:MOS) in its Q1 2022 investor letter:
“Despite a rally near the end of the quarter, major equity indexes closed lower as fear of U.S. Federal Reserve (FED) balance sheet tapering, interest rate hikes, and war in the Ukraine sent the bulls into retreat. Supply chains eased for some goods, but remained challenged for many commodities including energy, agriculture, and fertilizer due to war and general scarcity, and also in many consumer products as semiconductors remained in short supply. Potash and phosphate fertilizer producer Mosaic (NYSE:MOS) performed strongly as war exacerbated already short supplies of key oil and gas exploration.”
2. General Motors Company (NYSE:GM)
Number of Hedge Fund Holders: 76
General Motors Company (NYSE:GM) is an American multinational automobile manufacturer. In Q4 2021, David Tepper’s Appaloosa Management owned 2.25 million shares of General Motors Company (NYSE:GM), worth about $132 million. The hedge fund dumped its stake completely in the first quarter of 2022.
On July 27, Benchmark analyst Michael Ward lowered the price target on General Motors Company (NYSE:GM) to $60 from $75 and kept a Buy rating on the shares after the company’s Q2 results. The analyst dropped his 2023 earnings estimate to account for increased interest costs at GM Financial and reduced his target multiple to the low end of his range.
According to Insider Monkey’s data, 76 hedge funds were long General Motors Company (NYSE:GM) in Q1 2022, down from 90 funds a quarter earlier. Warren Buffett’s Berkshire Hathaway held the biggest position in the company, consisting of 62 million shares worth $2.7 billion.
Here is what Diamond Hill Large Cap Fund has to say about General Motors Company (NYSE:GM) in its Q1 2022 investor letter:
“General Motors—and the auto industry in general—continues to face headwinds related to supply chain disruptions and raw material cost inflation. In addition, uncertainty surrounding global energy markets due to inflation and the conflict in Ukraine has created a greater economic burden on consumers, which tends to slow automotive sales.”
1. T-Mobile US, Inc. (NASDAQ:TMUS)
Number of Hedge Fund Holders: 91
T-Mobile US, Inc. (NASDAQ:TMUS) provides mobile communications services in the United States, Puerto Rico, and the Virgin Islands. David Tepper has held a position in T-Mobile US, Inc. (NASDAQ:TMUS) since Q4 2017. The billionaire owned 1.2 million shares of T-Mobile US, Inc. (NASDAQ:TMUS) in Q4 2021, worth $148 million, representing 3.8% of the total 13F portfolio. He disposed of his T-Mobile US, Inc. (NASDAQ:TMUS) stake in Q1 2022.
On July 28, Cowen analyst Paul Gallant raised the price target on T-Mobile US, Inc. (NASDAQ:TMUS) to $187 from $179 and maintained an Outperform rating on the shares. The analyst said that T-Mobile US, Inc. (NASDAQ:TMUS) reported robust Q2 results and lifted 2022 guidance. He noted that the beat and raise further supports his view that the company is best positioned in the sector from both a micro and macro standpoint.
According to Insider Monkey’s data, 91 hedge funds were bullish on T-Mobile US, Inc. (NASDAQ:TMUS) at the end of Q1 2022, up from 86 funds in the last quarter. Andreas Halvorsen’s Viking Global is the leading shareholder of the company, with 13.4 million shares worth $1.72 billion.
Here is what ClearBridge Investments Sustainability Leaders Strategy has to say about T-Mobile US, Inc. (NYSE:TMUS) in its Q4 2021 investor letter:
“As mentioned, the communication services sector has come under some pressure, and irrational pricing competition has negatively impacted wireless industry growth and profitability of late, weighing on T-Mobile. Faced with these headwinds, and with pressure from other wireless carriers and cable companies that could cause the company to cede share in subscriber growth in 2022, we exited our position in the fourth quarter.”
You can also take a look at 10 Stocks to Buy Now According to David Einhorn’s Greenlight Capital and 7 Energy Stocks to Buy Now According to Billionaire Leon Cooperman.
