This article presents an overview of the Billionaire Mason Hawkins’ 5 Stock Picks with Huge Upside Potential. For a detailed overview of such stocks, read our article, Billionaire Mason Hawkins’ 11 Stock Picks with Huge Upside Potential.
5. PayPal Holdings Inc (NASDAQ:PYPL)
Number of Hedge Fund Investors: 78
Average Analyst Price Estimate: $73
Upside Potential: 21.67%
PayPal Holdings Inc (NASDAQ:PYPL) ranks fifth in our list of the top Mason Hawkins’ stock picks with upside potential. According to Yahoo Finance data, PayPal Holdings Inc (NASDAQ:PYPL) average analyst price target for the next 12 months is $73.
Mizuho recently downgraded PayPal Holdings Inc (NASDAQ:PYPL) stock to Neutral, citing market share loss to Apple Pay.
As of the end of the third quarter of 2023, 78 hedge funds out of the 910 funds tracked by Insider Monkey had stakes in PayPal Holdings Inc (NASDAQ:PYPL). The biggest stakeholder of PayPal Holdings Inc (NASDAQ:PYPL) during this period was Gavin Baker’s Atreides Management which owns a $244 million stake in PayPal Holdings Inc (NASDAQ:PYPL).
Wedgewood Partners stated the following regarding PayPal Holdings, Inc. (NASDAQ:PYPL) in its fourth quarter 2023 investor letter:
“PayPal Holdings, Inc. (NASDAQ:PYPL) also contributed less to portfolio performance than most holdings during the fourth quarter. The total payment volume handled by PayPal during its most recent quarter grew +15%, which helped drive healthy revenue growth and +20% earnings per share growth. Critically, the Company’s new management team has significant opportunity to drive more revenue and earnings growth across the massive, multi-trillion-dollar payments addressable market. PayPal’s rapidly growing payment processing brand, Braintree, represents one of those revenue growth opportunities, either by raising prices, as the Company had previously used a low-price strategy to establish a beachhead in this market, or by adding value-added services. PayPal’s branded checkout remains the largest volume and profit driver for the business, and we expect this to continue to track in-line with e-commerce growth in the near term, and eventually take share as the Company rolls out new features to its over +400 million users and +30 million merchants. We added to our position with the stock trading at just 10X forward earnings estimates during the quarter because there are many more long-term growth opportunities relative to most financial companies that trade for similar multiples and compared to technology companies that trade for much higher multiples.”
4. MGM Resorts International (NYSE:MGM)
Number of Hedge Fund Investors: 47
Average Analyst Price Estimate: $53
Upside Potential: 23.69%
Casino giant MGM Resorts International (NYSE:MGM) is one of the top stocks in billionaire Mason Hawkins’ portfolio with upside potential.
In December, UBS published a list of top global stocks the firm believes could gain in 2024. MGM Resorts International (NYSE:MGM) made it to the list. Here is what UBS said in its note while sharing these stocks:
“After dipping more than 10% between August and October, global equities strongly rebounded in November amid hopes central banks will pivot to a more dovish stance. Lower market rates and resilient earnings are likely to support the asset class going forward, but a lot of optimism seems to already be priced in and macroeconomic risks are more skewed to the downside.”
MGM Resorts International’s (NYSE:MGM)12-month price target set by Wall Street analysts on average is $53, while the stock was trading at around $42.
Longleaf Partners Fund made the following comment about MGM Resorts International (NYSE:MGM) in its Q3 2023 investor letter:
“Digital holding company IAC was the largest detractor in the quarter after reporting weak earnings, particularly at underlying holding Angi, which represents a relatively small (single-digit %) proportion of the value but has an outsized impact on IAC’s stock price. Casino and online gaming company MGM Resorts International (NYSE:MGM) (which we also own directly and was a detractor in the quarter) comprises the largest portion of the IAC value. MGM faced multiple headwinds this quarter with a cyberattack that impacted all its properties and pending labor strikes in Las Vegas. Even with these events factored into our appraisal, MGM remains highly discounted today, and management is taking advantage of the price weakness to add value through meaningful share repurchase.”
3. Bio-Rad Laboratories Inc. (NYSE:BIO)
Number of Hedge Fund Investors: 44
Average Analyst Price Estimate: $413
Upside Potential: 30.69%
Life sciences research and clinical diagnostics products company Bio-Rad Laboratories Inc. (NYSE:BIO) ranks third in our list of the stocks in Mason Hawkins’ portfolio with upside potential.
As of the end of the third quarter of 2023, 44 hedge funds out of the 910 funds tracked by Insider Monkey had stakes in Bio-Rad Laboratories Inc. (NYSE:BIO). The biggest hedge fund stakeholder of Bio-Rad Laboratories Inc. (NYSE:BIO) during this period is Israel Englander’s Millennium Management which owns a $135 million stake in Bio-Rad Laboratories Inc. (NYSE:BIO).
2. IAC Inc (NASDAQ:IAC)
Number of Hedge Fund Investors: 44
Average Analyst Price Estimate: $71
Upside Potential: 40.69%
According to Yahoo Finance, average analyst price target for IAC Inc (NASDAQ:IAC) over the next 12 months is $71 while the stock was trading at around $49.
Billionaire Mason Hawkins owns a $117 million stake in IAC Inc (NASDAQ:IAC) as of the end of the third quarter of 2023.
In November IAC Inc (NASDAQ:IAC) posted third quarter results. GAAP EPS in the period came in at -$4.72, missing estimates by $4.17. Revenue in the period fell 14.6% year over year to $1.11 billion, meeting estimates.
TimesSquare Capital U.S. Mid Cap Growth Strategy made the following comment about IAC Inc. (NASDAQ:IAC) in its Q3 2023 investor letter:
“For the Communications Services sector, we generally prefer to invest in media and services companies that are either well placed from an advertising perspective with a target audience or provide differentiated services. IAC Inc. (NASDAQ:IAC) is engaged in the media and Internet business. Its two core business segments are Dotdash Meredith and ANGI Homeservices. Dotdash Meredith provides digital and print publishing services. ANGI Homeservices offers a gateway to repair, remodeling, cleaning, and other services. While Dotdash Meredith results were in line, ANGI fell short of expectations as they are shifting their focus to high-quality customers to generate more profitability. Shares of IAC fell -20% on this report and we added to the position on weakness.”
1. Liberty Broadband Corp (NASDAQ:LBRDA)
Number of Hedge Fund Investors: 52
Average Analyst Price Estimate: $117
Upside Potential: 52%
Communications company Liberty Broadband Corp (NASDAQ:LBRDA) ranks first in our list of the stocks with upside potential in billionaire Mason Hawkins’ portfolio.
Yahoo Finance data indicates Liberty Broadband Corp’s (NASDAQ:LBRDA) 12-month average price target is $117 while it was trading at around $76.94 as of January 17.
A total of 52 hedge funds out of the 910 funds tracked by Insider Monkey had stakes in Liberty Broadband Corp (NASDAQ:LBRDA). The biggest stakeholder of Liberty Broadband Corp (NASDAQ:LBRDA) during this period was $88 million.
Madison Mid Cap Fund stated the following regarding Liberty Broadband Corporation (NASDAQ:LBRDA) in its fourth quarter 2023 investor letter:
“The bottom five detractors for the quarter were Arch Capital Group, Liberty Broadband Corporation (NASDAQ:LBRDA), Brown & Brown, Markel Group, and CarMax. Shares of Liberty Broadband, a holding company with a large investment in cable operator Charter Communications, were weak in the quarter as internet subscriber trends continue to disappoint. While the competitive environment is currently tough, we believe it will improve over time. Cable’s technology infrastructure is demonstrably superior, in both cost and performance, to what some of the legacy telecommunications carriers are currently rolling out in the form of “fixed wireless” broadband. Thus, their potential subscriber base is limited to a segment of the population base. We believe it likely therefore that the carriers will soon be limited in the competition they provide to Charter.”
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