In this article, we will discuss the 10 stocks that Ken Griffin is selling.
Ken Griffin’s investment career started in 1986 when he was still a student at Harvard University. In 1990, he founded Citadel Investment Group, a hedge fund firm, which grew out to be one of the most successful firms in the world. Currently, Griffin is serving as the firm’s Chief Executive Officer. As of November 22, Griffin’s real-time net worth stands at roughly $21 billion.
Before founding Citadel Investment, Griffin worked with Frank C. Meyer, a South Florida-based hedge fund manager, who was highly impressed by Griffin’s investment strategies. Meyer provided him $1 million to invest on his own in 1988 and by deploying his famous convertible arbitrage strategy, Griffin returned 70% that year.
Citadel Investment is a quantitative hedge fund that utilizes different mathematical models as its investment strategy. The hedge fund seeks “high risk-adjusted returns” for its clients.
According to a report published by CNBC, Citadel’s flagship fund Wellington gained 8% in September, compared to a 4.8% decline of the S&P 500 in the same month, as the benchmark index recorded its worst month since March 2020. Wellington’s year-to-date returns stand at 18.5%. Moreover, the fund has delivered an annual average return of 19.1% since its inception in 1990, as reported by Financial Times. As of Q3, Citadel Investment’s portfolio value stands at over $481.2 billion, presenting a 1.08% growth from the previous quarter. The top ten holdings account for 29.6% of the fund’s portfolio.
However, in this article, we’ll discuss the companies in which Citadel Investment has sold its stake entirely by the end of Q3. Some of those companies include Berkshire Hathaway Inc. (NYSE:BRK-A), NIKE, Inc. (NYSE:NKE), U.S. Bancorp (NYSE:USB), Dropbox, Inc. (NASDAQ:DBX), and Truist Financial Corporation (NYSE:TFC).
Our Methodology:
Let’s analyze our list of the stocks Ken Griffin is selling in Q3. The stocks were picked from Citadel Investment’s 13F portfolio as of Q3. Citadel sold its entire stakes in these companies in the third quarter.
Ken Griffin of Citadel Investment Group
Billionaire Ken Griffin is Selling These 10 Stocks
10. Ryder System, Inc. (NYSE:R)
Number of Hedge Fund Holders: 18
Ryder System, Inc. (NYSE:R) is an American logistics and transportation company, mainly known for its fleet of commercial trucks. In its recently announced Q3 report, the company posted an EPS of $2.55, beating the estimates by $0.46. Moreover, Ryder System, Inc. reported revenue of $2.5 billion, experiencing a 16.3% growth from the prior-year quarter.
As of Q3, Ken Griffin’s portfolio does not include Ryder System, Inc. as his hedge fund sold out its entire stake in the company by the end of the third quarter. Of the 873 hedge funds tracked by Insider Monkey, 18 hedge funds had positions in Ryder System, Inc. in Q2, down from 20 in the previous quarter. These stakes are valued at over $271 million.
On October 28, Truist presented a positive outlook on Ryder System, Inc. due to the company’s strong Q3 results. The firm lifted its price target on the stock to $100, with a Buy rating on the shares. Since the beginning of the year, Ryder System, Inc. delivered a 36.6% return to shareholders, while the stock gained 45.8% in the past year.
9. Scientific Games Corporation (NASDAQ:SGMS)
Number of Hedge Fund Holders: 24
Scientific Games Corporation (NASDAQ:SGMS) is an American gambling company that specializes in gambling products and services. After hitting an all-time low of $5.87 per share in March 2020, the stock bounced back, gaining 64.9% in 2021. In Q3, Citadel Investment sold off its entire stake in the company.
Recently, Deutsche Bank lifted its price target on Scientific Games Corporation to $71 from $63, mentioning the company’s new reporting structure and its growing sports betting business. On November 9, Scientific Games Corporation announced its Q3 results and posted a GAAP EPS of $0.96, which beat the consensus by $0.63.
At the end of Q2, 24 hedge funds tracked by Insider Monkey reported owning stakes in Scientific Games Corporation, up from 23 in the previous quarter. The total value of these stakes is over $1.4 billion, up significantly from $785 million in Q1.
Like Berkshire Hathaway Inc., NIKE, Inc., U.S. Bancorp, Dropbox, Inc., and Truist Financial Corporation, Citadel Investment sold Scientific Games Corporation in Q3.
8. Bath & Body Works, Inc. (NYSE:BBWI)
Number of Hedge Fund Holders: N/A
Bath & Body Works, Inc. is an American retail store chain that sells soaps, sanitizers, fragrances, and candles.
Bath & Body Works, Inc. expects a boost in sales during the upcoming holiday season. The company’s Q3 results showed a 53% growth in sales, while its EPS rose 360% from the pre-pandemic level in 2019, at $0.92, beating the estimates by $0.32. Due to these positive results, recently, Morgan Stanley lifted its price target on Bath & Body Works, Inc. to $90, while keeping an Overweight rating on the shares.
However, Citadel sold its stake in the company in Q3.
Lone Pine Capital was the company’s largest shareholder at the end of Q2, owning shares worth $1.8 billion.
7. e.l.f. Beauty, Inc. (NYSE:ELF)
Number of Hedge Fund Holders: 30
As of Q2, Insider Monkey’s data shows that hedge fund interest is rising in e.l.f. Beauty, Inc. (NYSE:ELF), an American cosmetic brand. By the end of Q2, 30 hedge funds tracked by Insider Monkey reported owning $150 million worth of stakes in the company. In the previous quarter, 21 hedge funds held positions in the company, with stakes valued at $138.7 million.
On November 3, e.l.f. Beauty, Inc. announced its fiscal Q2 2022 results and posted an EPS of $0.21, beating the estimates by $0.09. The company’s revenue also experienced a 13.7% year-over-year growth at $91.8 million. Recently, Citigroup lifted its price target on e.l.f. Beauty, Inc. to $39, while keeping a Buy rating on the shares. The firm’s analyst appreciated the company’s fiscal 2022 guidance.
Citadel sold its entire stake in the company in the third quarter.
Since the beginning of the year, e.l.f. Beauty, Inc. delivered a 29.2% return to shareholders, while the stock gained 47.05% in the past year. With over 1 million shares, Portolan Capital Management is the company’s largest shareholder in Q3.
6. CBRE Group, Inc. (NYSE:CBRE)
Number of Hedge Fund Holders: 37
CBRE Group, Inc. (NYSE:CBRE) is an American real estate company that also provides related services to its consumers. The stock delivered a 67.5% return to shareholders in 2021, while its 12-month gains stand at 66.7%.
Ken Griffin sold his entire stake in the company in the third quarter.
In its recently announced Q3 report, CBRE Group, Inc. reported revenue of $6.8 billion, up from $5.6 billion during the same period last year. The company also posted an EPS of $1.39, versus the estimates of $1.19. Recently, Evercore ISI added CBRE Group, Inc. to its best ‘Core’ ideas list and lifted its price target on the stock to $130, with an Outperform rating on the shares.
As of Q3, Harris Associates is the largest shareholder of CBRE Group, Inc., holding a $1 billion worth of stake. Overall, 37 hedge funds tracked by Insider Monkey held positions in the company at the end of Q2, up from 30 in the previous quarter. These stakes are valued at over $2.64 billion.
Citadel sold CBRE Group, Inc. in Q3, in addition to Berkshire Hathaway Inc., NIKE, Inc., U.S. Bancorp, Dropbox, Inc., and Truist Financial Corporation .
Baron Funds mentioned CBRE Group, Inc. in its recently-published Q3 2021 investor letter. Here is what the firm has to say:
“Leading commercial real estate service company CBRE Group, Inc. delivered exceptional business results in the second quarter and the shares of CBRE increased 27%. We remain optimistic about the prospects for CBRE given its market share leadership positions, global business platforms, scale advantages, strong balance sheets, and possible acquisition opportunities. We believe the company is likely to grow earnings at an attractive double-digit growth rate over the next few years, and the shares of the company remain attractively valued.”
5. Truist Financial Corporation (NYSE:TFC)
Number of Hedge Fund Holders: 39
Truist Financial Corporation, an American bank holding company, was recently appreciated at Citigroup due to its growing insurance business. The firm lifted its price target on the stock to $72, while upgrading it to Buy from Neutral.
Ken Griffin’s fund sold its entire stake in the company in the third quarter. However, by the end of Q2, 39 hedge funds tracked by Insider Monkey held positions in Truist Financial Corporation, up from 36 in the previous quarter. These stakes are valued at over $1 billion, compared with the value of $845.8 million in Q1.
On October 26, Truist Financial Corporation declared a quarterly dividend of $0.26 per share. The stock’s current dividend yield stands at 2.97%. In its Q3 earnings, the company posted an EPS of $1.42, beating the estimates by $0.22. Moreover, Truist Financial Corporation reported revenue of $5.63 billion, driven by insurance, investment banking, and residential mortgage banking. The stock gained 29.09% in the past year.
4. Dropbox, Inc. (NASDAQ:DBX)
Number of Hedge Fund Holders: 39
Dropbox, Inc. is an American software company that offers cloud storage, file synchronization, and personal cloud to its users. In Q3, the company reported a 12% year-over-year growth in its accounting rate of return at $2.21 billion. Moreover, paying users also increased to 16.49 million, up from 15.25 million during the same period last year.
Recently, Jefferies Financial lifted its price target on Dropbox, Inc. to $40, while keeping a Buy rating on the shares. Since the beginning of the year, the stock gained 13.5%, while its 12-month returns stood at 30.9%. In Q3, Dropbox, Inc. is not included in Ken Griffin’s portfolio.
With roughly 10 million shares, Renaissance Technologies is the leading shareholder of Dropbox, Inc. in Q3. Overall, 39 hedge funds tracked in Insider Monkey’s database were bullish on the company in Q2, up from 31 in the previous quarter. The total value of these stakes is over $929.4 million, compared with $775.8 million in the previous quarter.
3. U.S. Bancorp (NYSE:USB)
Number of Hedge Fund Holders: 41
U.S. Bancorp, an American bank holding company, has recently announced to buy TravelBank, a fintech and travel management company. Through this, U.S. Bancorp seeks to enhance the integration of digital payments within its commercial segment.
In Q3, U.S. Bancorp posted a GAAP EPS of $1.30, beating the estimates by $0.14. The company also reported a 4% year-over-year growth in its digital active customers. This October, RBC Capital raised its price target on U.S. Bancorp to $66, with an Overweight rating on the shares, appreciating the company’s strong Q3 results.
At the end of Q2, 41 hedge funds tracked by Insider Monkey reported owning stakes in U.S. Bancorp, down from 43 in the previous quarter. The total value of these stakes is over $8.3 billion. Warren Buffett’s Berkshire Hathaway is the leading shareholder of U.S. Bancorp in Q3, holding stakes worth $7.5 billion.
2. NIKE, Inc. (NYSE:NKE)
Number of Hedge Fund Holders: 67
NIKE, Inc. is an American company that mainly deals in footwear, apparel, accessories, and equipment. On November 18, the company announced an 11% growth in its quarterly dividend at $0.305 per share. The stock’s current dividend yield stands at 0.71%.
This October, Goldman Sachs initiated its coverage on NIKE, Inc. with a Buy rating and a $172 price target, appreciating the company’s high cash balance. In its fiscal Q1 2022 earnings, NIKE, Inc. reported a 15.6% year-over-year growth in its revenue at $12.2 billion. In Q3, the company is not included in Ken Griffin’s portfolio.
Of the 873 elite funds tracked by Insider Monkey, 67 hedge funds held stakes in NIKE, Inc. in Q2, compared with 78 in the previous quarter. These stakes are valued at over $6.4 billion, up significantly from $5.1 billion in Q1.
1. Berkshire Hathaway Inc. (NYSE:BRK-A)
Number of Hedge Fund Holders: 116
Berkshire Hathaway Inc. is an American multinational holding company. Citadel sold 100% of its stake in the company in Q3.
Since the beginning of the year, Berkshire Hathaway Inc. delivered a 23.2% return to shareholders in 2021. It is one of the most expensive stocks today, currently trading at over $423,374 per share. Recently, Keefe Bruyette presented a positive outlook on Berkshire Hathaway Inc., while setting a $485,000 price target on the stock, with a Market Perform rating on the shares.
As of Q3, Bill & Melinda Gates Foundation Trust is the largest shareholder of Berkshire Hathaway Inc., holding stakes worth $10.5 billion. Overall, 116 hedge funds tracked by Insider Monkey were bullish on the company in Q2, up from 111 in the previous quarter. These stakes are valued at over $22.3 billion.
Black Bear Value Partners mentioned Berkshire Hathaway Inc. in its Q3 2021 investor letter. Here is what the firm has to say:
“Please see Q1 letter for our Berkshire on a Napkin investment exercise. We have written on it extensively and will save your eyeballs from extraneous reading. Berkshire is very cheap for owning such high-quality businesses and will continue to grind higher and compound value for us.”
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This article is originally published at Insider Monkey.
