In this article, we will be discussing the 10 stocks that billionaire Rob Citrone is selling.
Rob Citrone is an American hedge fund manager and the co-founder of the Connecticut-based investment fund Discovery Capital Management. After earning his bachelor’s degree from Hampden-Sydney College, and his M.B.A from the Darden School of Business, Robert Citrone began his career as a corporate bond analyst at Fidelity Investments in 1990, resigning from there shortly thereafter in 1995 to join Tiger Management, working under the tutelage of the legendary investor, Julian Robertson. In 1999, Rob Citrone left the firm and founded Discovery Capital Management.
Rob Citrone’s investment strategy focuses on liquidity, valuation multiples, and potential growth when scouting for stocks to invest in. Discovery Capital Management is known for making macro analysis and risk assessment management, thus investing in emerging markets. In 2013, Citrone’s Discovery Global Opportunity Partners fund returned 27.5%, and Discovery Capital’s annualized returns since 1999 value at 17%.
According to the most recent 13F filings, Discovery Capital Management, as an investment management firm, oversees more than $1.54 billion in its investment portfolio. The fund’s portfolio is diversified across 11 leading sectors, with the Technology sector being the largest one. A majority of the companies in the fund’s investment portfolio consist of large-cap companies with stocks scaling up to more than $10 billion in market capitalization, making up 36% of the fund’s total value.
Some of the top stocks present in the investment portfolio of Discovery Capital Management at the end of the second quarter of 2021 include Micron Technology, Inc. (NASDAQ:MU), Facebook, Inc. (NASDAQ:FB), Alphabet Inc. (NASDAQ:GOOG) and Intel Corporation (NASDAQ:INTC), among others.
Our Methodology
With this background in mind, let us now look towards the 10 stocks billionaire Rob Citrone is selling. We made use of Discovery Capital Management’s 13F portfolio for the second quarter for this analysis. The following list consists of stocks that the hedge fund sold off completely in the second quarter of 2021.
Why should we pay attention to Robert Citrone’s stocks? Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 86 percentage points since March 2017. Between March 2017 and July 2021, our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY. Our stock picks outperformed the market by 86 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
Billionaire Rob Citrone is Selling These 10 Stocks
10. Carnival Corporation & plc (NYSE:CCL)
Number of Hedge Fund Holders: 31
Carnival Corporation & plc (NYSE:CCL), the largest leisure company in the world, operates as a British-American cruise company. Ranked tenth on the list of the 10 stocks billionaire Rob Citrone is selling, Carnival Corporation & plc has a market capitalization of $28.57 billion.
Discovery Capital Management sold its entire stake in Carnival Corporation & plc (NYSE:CCL) by the end of the second quarter period.
In the second quarter of 2021, Carnival Corporation & plc (NYSE:CCL) reported an EPS of -$1.80, missing estimates by $0.19. The company’s revenue in the quarter, was $50 million, falling short of the revenue estimates by $148.97 million.
At the end of the second quarter of 2021, 31 hedge funds in the database of Insider Monkey held stakes worth over $456 million in Carnival Corporation & plc (NYSE:CCL). This is compared to 44 hedge funds in the previous quarter with stakes worth approximately $593.6 million.
Unlike Micron Technology, Inc., Facebook, Inc., Alphabet Inc. and Intel Corporation, Carnival Corporation & plc (NYSE:CCL) is a stock that Robert Citrone is selling.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, commented on Carnival Corporation & plc (NYSE:CCL)’s probable gain in pricing power. Here is what the fund said:
“Several of our better performers in the first quarter were purchased while their business models were under stress from COVID restrictions or the macro environment the pandemic created. What gave us confidence in purchasing Carnival was the actions the company took to extend out their balance sheets until travel resumed. Both should benefit as a broader vaccination rollout prompts cruise lines to resume operations and consumers to start traveling again and are positioned to deliver better margins and gain pricing power as the economy normalizes due to the cost controls implemented during the downturn.”
9. Commscope Holding Company Inc (NASDAQ:COMM)
Number of Hedge Fund Holders: 36
Commscope Holding Company Inc (NASDAQ:COMM) is a North Carolina-based provider of infrastructure solutions for communication and entertainment networks, with operations in over 130 countries. The company is ranked ninth on the list of the 10 stocks billionaire Rob Citrone is selling.
By the end of the second quarter, Discovery Capital Management sold off its entire stake in the company.
In the second quarter of 2021, Commscope Holding Company Inc had an actual EPS of $0.43, beating estimates by $0.01. The company also reported revenues amounting to $2.19 billion, beating estimates by $12.94 million.
By the end of the second quarter of 2021, 36 hedge funds out of the 873 tracked by Insider Monkey held stakes in Commscope Holding Company Inc worth roughly $1.02 billion. This is compared to 32 hedge funds in the previous quarter with a total stake value of approximately $757.9 million.
On July 6, Morgan Stanley analyst Meta Marshall raised the price target on Commscope Holding Company Inc to $24 from $19, and kept an Overweight rating on the shares.
8. Qualtrics International, Inc. (NASDAQ:XM)
Number of Hedge Fund Holders: 37
Based in Provo, Utah, Qualtrics International, Inc. (NASDAQ:XM) is a software company engaged in the design and development of application software. The company provides an experience management platform for companies and organizations to design, manage, and operate their businesses. The software company ranks eighth on our list of the 10 stocks billionaire Rob Citrone is selling.
By the end of the second quarter of 2021, 37 hedge funds out of the 873 tracked by Insider Monkey held stakes in Qualtrics International, Inc. worth roughly $2.4 billion. The number of hedge funds that held stakes within the company remained the same for the first and second quarters of 2021.
The company issued its quarterly earnings report for the second quarter of 2021 on July 20, with reported earnings per share at $0.04, crossing market estimates by $0.06. Additionally, the reported revenues came in at $249.34 million, surpassing the predicted revenues by $7.69 million.
On July 21, Deutsche Bank analyst Patrick Colville raised his price target on Qualtrics International, Inc. to $45 from $43, and restated a Buy rating on the shares of the company.
In its Q2 2021 investor letter, ClearBridge Investments stated that they could not keep a sufficient position in Qualtrics International Inc.. Here is what the fund said:
“On the sell side, we closed out of Qualtrics, an experience management software company, where we were unable to build a sufficient position following its successful IPO.”
7. Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH)
Number of Hedge Fund Holders: 43
Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) is a leading American cruise company based in Florida. The company offers a number of travel itineraries to its customers across North America and the Caribbean, among other locations. Ranked seventh on the list of the 10 stocks billionaire Rob Citrone is selling, Norwegian Cruise Line Holdings Ltd. has a market capitalization of $10.19 billion.
Robert Citrone’s hedge fund sold its entire stake in Norwegian Cruise Line Holdings Ltd. in the second quarter of 2021.
The company last released its earnings report on August 6, 2021, with a reported earning of -$1.93 per share on an adjusted basis, beating the consensus forecast of -$2.00 per share by $0.07. The company also reported a revenue of $4.37 million for that quarter, falling short of the estimated revenue by $4.77 million.
At the end of the second quarter of 2021, 43 hedge funds in the database of Insider Monkey held stakes worth $606.6 million in Norwegian Cruise Line Holdings Ltd., up from 34 hedge funds in the previous quarter with stakes worth more than $576 million.
On August 20, Deutsche Bank analyst Chris Woronka raised his price target on Norwegian Cruise Line Holdings Ltd. to $26 from $25, and kept a Hold rating on the shares.
Unlike Micron Technology, Inc., Facebook, Inc., Alphabet Inc. and Intel Corporation, Norwegian Cruise Line Holding Ltd. is among the stocks that Robert Citrone is selling.
In its Q4 2020 investor letter, Brown Capital Management Mid Company Fund explained why Norwegian Cruise Line Holdings Ltd. is no longer part of the fund’s portfolio. Here is what they said:
“Norwegian Cruise Line Holdings (NCLH) is a diversified operator of leading global cruise lines spanning market segments from contemporary to luxury under the Norwegian Cruise Line, Oceanic Cruises and Regent Seven Seas Cruises brands. These brands operate a combined 28 ships. Norwegian was eliminated from the portfolio, as we no longer believe it meets our definition of an Exceptional Growth Company, as discussed in our first quarter letter. There are still many unknowns as to when we will see a fully normalized operating environment with a high degree of confidence.”
6. The Goldman Sachs Group, Inc. (NYSE:GS)
Number of Hedge Fund Holders: 61
The Goldman Sachs Group, Inc. (NYSE:GS) is placed sixth on our list of the 10 stocks billionaire Rob Citrone is selling. The firm operates as a financial services company headquartered in New York, and provides investment management, asset management, and securities, among other services.
With a 100% reduction in stakes in the second quarter, Discovery Capital Management sold off all the shares it held of The Goldman Sachs Group, Inc..
On October 1, Citi analyst Keith Horowitz raised the price target on The Goldman Sachs Group, Inc. to $440 from $410, and kept a Buy rating on the shares.
On July 13, The Goldman Sachs Group, Inc. released its quarterly earnings report for the second quarter of 2021, with a reported EPS at $15.02, beating estimates by $4.84. The firm also declared revenues of $15.39 billion, surpassing forecast estimates by $2.99 billion.
At the end of the second quarter of 2021, 61 hedge funds in the database of Insider Monkey held stakes worth $5.18 billion in The Goldman Sachs Group, Inc., down from 77 hedge funds in the previous quarter with stakes worth approximately $5.05 billion.
Ariel Investments, an investment management firm, praised The Goldman Sachs Group, Inc.’s excellent quarterly results and asset management in its Q2 investor letter. Here is what the fund said:
“Goldman Sachs Group Inc. (GS) returned +16.45%. Goldman has posted a series of excellent quarterly results. Merger and equity offering activity has been robust with trading profits bolstered by strong capital market volumes. Goldman’s asset management business has also performed well. Regulators recently moved to allow most large investment banks to return capital to shareholders through dividends and share repurchases. Fundamentally, we think Goldman Sachs is attractively priced at approximately 11 times earnings and a very reasonable multiple of book value.”
5. Exxon Mobil Corporation (NYSE:XOM)
Number of Hedge Fund Holders: 68
Exxon Mobil Corporation (NYSE: XOM), is a multinational oil and gas company that manufactures and transports crude oil, natural gas, petroleum products, petrochemicals, and other specialty products. Based in Irving, Texas, Exxon Mobil Corporation ranks fifth on the list of the 10 stocks billionaire Rob Citrone is selling.
Discovery Capital Management had sold off its entire stake in Exxon Mobil Corporation in the second quarter.
In the second quarter of 2021, Exxon Mobil Corporation had an EPS of $1.10, beating estimates by $0.11. The company’s revenue was $67.74 billion, an increase of 107.77% on a year-over-year basis, beating estimates by $3.02 billion.
By the end of the second quarter of 2021, 68 hedge funds out of the 873 tracked by Insider Monkey held stakes in Exxon Mobil Corporation worth roughly $3.7 billion. This is compared to 65 hedge funds in the previous quarter with a total stake value of approximately $2.8 billion.
On July 23, Piper Sandler analyst Ryan Todd raised his price target on Exxon Mobil Corporation to $69 from $63, and kept a Neutral rating on the shares.
In its Q2 2021 investor letter, First Eagle Investment Management stated that Exxon Mobil Corporation was one of the leading contributors in the fund for the quarter. Here is what they said:
“Leading contributors in the First Eagle Global Fund this quarter included Exxon Mobil Corporation. The continued recovery in oil prices as economies reopen helped fuel another strong performance across the energy complex, including shares of Exxon Mobil. Exxon Mobil recently lost a proxy fight with an activist investor that took three of the company’s 12 board seats. While the press was focused on the investor’s concerns over Exxon Mobil’s long term energy transformation strategy, other factors fundamental to shareholder returns—like capital discipline and balance sheet management—were also at play.”
4. Snowflake Inc. (NYSE:SNOW)
Number of Hedge Fund Holders: 70
Snowflake Inc. (NYSE:SNOW) is a cloud-based data storage and analytics services company headquartered in Montana. The company has a market capitalization of $88.67 billion, and is ranked fourth on our list of the 10 stocks billionaire Rob Citrone is selling.
At the end of the second quarter of 2021, 70 hedge funds in the database of Insider Monkey held stakes worth $12.5 billion in Snowflake Inc.. This is compared to 71 hedge funds in the preceding quarter with stake worth $12.96 billion.
On September 30, BTIG analyst Gray Powell upgraded Snowflake Inc. to a Buy rating from Neutral, with a $353 price target.
RiverPark Large Growth Fund, in their Q1 2021 investor letter, mentioned their new position in Snowflake Inc.. Here is what the fund said:
“We also established a position in Snowflake during the quarter. Snowflake offers cloud-based data storage and analytics, generally termed “data warehouse-as-a-service.” The data warehousing market—created by the massive, growing amount of user, customer, and account data and the need to search and analyze it—has historically stored its data on physical servers located on-premises. The cloud data platform market—storing data off-premises on cloud servers—is a relatively new $70 billion+ market. Significantly, incremental warehouse data capacity and renewals are expected to be driven by and to the cloud, with more than 75% of databases in the cloud by 2022.
Snowflake requires absolutely no infrastructure management from its users, is fully scalable for each customer, runs on Amazon, Microsoft, or Google cloud platforms, and most critically, Snowflake helps companies analyze their data. The company also has a unique, customer-aligned billing model based on usage. All of which has led to Snowflake being among the leaders of this highly fragmented market, posting 124% revenue growth last year. SNOW’s growth comes from the combination of more customers—which grew 73% last year—and customers buying more services—the company boasts an amazing 150%+ net customer retention. The company’s growing scale has also led to increasing gross margin and operating leverage, up 1,100 basis points and 8,200 basis points, respectively, over the past two years. The company has guided to FCF break-even this year, and with the company’s capital expenditure-light model—Snowflake uses the public cloud for hosting—we expect FCF to grow much faster than revenue growth, which we forecast to grow comfortably more than 50% per year for the next several years. Additionally, we have great confidence in the SNOW management team, which previously had an enormously successful run guiding one of our other core Cloud software holdings ServiceNow.”
3. ViacomCBS Inc. (NASDAQ:VIAC)
Number of Hedge Fund Holders: 71
ViacomCBS Inc. (NASDAQ:VIAC) is a multinational mass media and entertainment conglomerate that provides TV entertainment, cable network, and video streaming. The New York-based company is placed third on our list of the 10 stocks billionaire Rob Citrone is selling.
Robert Citrone’s hedge fund reduced its stake in the company by 100% in the second quarter, completely selling off all its shares of ViacomCBS Inc..
At the end of the second quarter of 2021, 71 hedge funds in the database of Insider Monkey held stakes worth $1.87 billion in ViacomCBS Inc., down from 89 hedge funds in the preceding quarter, with stakes amounting to approximately $2.3 billion.
ViacomCBS Inc. released its second quarter earnings report on August 5, with an EPS of $0.97, falling short of the estimated EPS by $0.02. On the other hand, the revenues generated amounted to $6.56 billion, beating market predictions by $62.16 million.
On August 18, Wells Fargo analyst Steven Cahall upgraded ViacomCBS Inc. to Overweight from Equal Weight, with a price target of $60, up from $45. The analyst stated that the results from the company’s streaming efforts were impressive.
2. Activision Blizzard, Inc. (NASDAQ:ATVI)
Number of Hedge Fund Holders: 78
Activision Blizzard, Inc. (NASDAQ:ATVI) is an industry-leading developer and publisher of interactive entertainment content. Known primarily for its video game development, some of the company’s most notable products include the Call of Duty series, Overwatch and the Diablo series, among others. Based in California, the company is ranked second on our list of the 10 stocks billionaire Rob Citrone is selling.
The company issued its quarterly earnings report for the second quarter of 2021 on August 3, with reported earnings per share at $0.91, crossing consensus estimates by $0.15. The company also declared its revenues at $1.92 billion, surpassing the estimated revenues by $31.57 million.
On September 29, Jefferies analyst Andrew Uerkwitz claimed to still be bullish on Activision Blizzard, Inc. (NASDAQ:AVTI), and kept a Buy rating on the shares, alongside a $120 price target.
Cooper Investors Global Equities Fund (Hedged), in their Q1 2021 investor letter, mentioned how their stakes in Activision Blizzard, Inc. could lead to significant value latency. Here is what the fund had to say:
“The portfolio established a position in video game publisher Activision Blizzard. As a watchlist company we have followed Activision for several years. As a reminder the role of the watchlist is to allow us to focus on a select group of companies where we seek to observe important signals around either value latency, industry trends or management behaviour that portend attractive investment propositions.
Technology can often play a disruptive role in content, however video games are a clear beneficiary of technology, both in terms of more immersive and realistic gaming experiences as well as the monetisation opportunities this creates…” (Click here to see the full text)
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 271
Amazon.com, Inc. (NASDAQ:AMZN) is a multinational company that specializes in e-commerce, cloud computing, digital streaming and artificial intelligence. The e-commerce giant has a market capitalization of $1.62 trillion, and is ranked first of the list of the 10 stocks billionaire Rob Citrone is selling.
Amazon.com, Inc. last released its earnings report on July 28, 2021, with reported earnings per share at $15.12, beating estimates of $12.22. The company also reported revenues of $113.08 billion, an increase of 27.18% on a year-over-year basis, although missing estimated revenues by $2.01 billion.
There were 271 hedge funds in our database that held stakes in Amazon.com, Inc. worth $60.49 billion in the second quarter of 2021, compared to 243 funds in the first quarter with total stakes amounting to approximately $50.4 billion.
On September 30, RBC Capital analyst Brad Erickson initiated coverage of Amazon.com, Inc. with an Outperform rating and $4,150 price target.
In the Q2 2021 investor letter of ClearBridge Investments, the fund states how Amazon.com, Inc. could be an opportunity for significant impact. Here is what they said:
“The Strategy’s goal of generating strong risk-adjusted performance while investing in companies that can make a positive impact on society and the environment is often supported by holdings that are companies with significant customer bases, making our engagements with them effective platforms for driving change. This is the case with new holding Amazon.com, the leading retail e-commerce site and provider of web hosting and related cloud services that continues to benefit from the migration of commerce from offline to online. We initiated a position in Amazon based on its strength in several areas, including retail, its Amazon Web Services cloud business and advertising; from a valuation perspective, Amazon has become more attractive as profitability has improved and the stock has gone sideways in an up market.
ClearBridge has been holding interactive engagements with Amazon on several ESG issues for several years, including labor and environmental issues, and we have seen improvements over that time. From a sustainability perspective, Amazon has made meaningful ESG commitments and improved labor practices and it faces fewer regulatory issues than many large tech peers. Labor management remains a key focal point and the company has made
increased commitments to its labor force, including in December 2018, when Amazon increased its minimum wage standard to $15 an hour in the U.S., well above the federal minimum wage standard. Amazon is also taking steps toward environmental sustainability that would put it ahead of peers if goals are achieved. In June 2019, Amazon set new targets to be carbon neutral by 2040 and to use 100% renewable energy by 2030…” (Click here to see the full text)
You can also take a peek at 15 Best Value Stocks to Invest In and 15 Best Consumer Discretionary Stocks to Buy Now.
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This article is originally published at Insider Monkey.
