In this article, we discuss the top 5 stock picks of Sculptor Capital. If you want our detailed analysis of these stocks, go directly to Sculptor Capital’s Top 10 Stock Picks.
5. Workday, Inc. (NASDAQ:WDAY)
Sculptor Capital’s Stake Value: $370,585,000
Percentage of Sculptor Capital’s 13F Portfolio: 3.05%
Number of Hedge Fund Holders: 72
Workday, Inc. (NASDAQ:WDAY) is a software company offering cloud-based systems for financial management and human capital management. Sculptor Capital, as of September 2021, owns 1.48 million shares in Workday, Inc. (NASDAQ:WDAY), worth $370.5 million, representing 3.05% of Sculptor’s Q3 investments.
At the end of the third quarter of 2021, 72 hedge funds monitored by Insider Monkey were long Workday, Inc. (NASDAQ:WDAY), with a total stake value of $6.38 billion. The leading stakeholder of the company is Stephen Mandel’s Lone Pine Capital, with a position valued at $1.24 billion in Workday, Inc. (NASDAQ:WDAY).
On November 18, the Q3 EPS for Workday, Inc. (NASDAQ:WDAY) came in at $1.10, beating estimates by $0.23. The revenue was up 20% from the prior-year quarter at $1.33 billion, outperforming estimates by $15.64 million. Following the Q3 results, Needham analyst Scott Berg on November 19 raised the price target on Workday, Inc. (NASDAQ:WDAY) to $360 from $310 and kept a Buy rating on the shares.
Here is what ClearBridge Investments has to say about Workday, Inc. (NASDAQ:WDAY) in its Q1 2021 investor letter:
“In addition to the new issue market, we have been tactically adding growth exposure. We took advantage of the selloff in disruptors that comprise a large portion of the portfolio to initiate a position in enterprise software maker Workday.”
4. Netflix, Inc. (NASDAQ:NFLX)
Sculptor Capital’s Stake Value: $388,262,000
Percentage of Sculptor Capital’s 13F Portfolio: 3.20%
Number of Hedge Fund Holders: 106
Netflix, Inc. (NASDAQ:NFLX), a subscription-based streaming service and original production company, is one of Sculptor Capital’s top stock picks from the third quarter. Sculptor Capital owns 636,141 Netflix, Inc. (NASDAQ:NFLX) shares, worth $388.2 million, which accounts for 3.2% of his Q3 securities.
As of Q3 2021, 106 hedge funds monitored by Insider Monkey were bullish on Netflix, Inc. (NASDAQ:NFLX), down from 113 in the preceding quarter. One of the leading Netflix, Inc. (NASDAQ:NFLX) stakeholders is Boykin Curry’s Eagle Capital Management, with 2.74 million shares valued at $1.67 billion.
Netflix, Inc. (NASDAQ:NFLX) posted its Q3 results on October 19, with EPS for the period being $3.19, beating estimates by $0.63. The $7.63 billion Q3 revenue was up 16.28% from the prior-year quarter, exceeding estimates by $0.16 million.
KeyBanc analyst Justin Patterson raised the price target on Netflix, Inc. (NASDAQ:NFLX) on November 15 to $725 from $690 and kept an Overweight rating on the shares, stating that he was confident about the company’s growth opportunities.
Here is what Ensemble Capital has to say about Netflix, Inc. (NASDAQ:NFLX) in its Q3 2021 investor letter:
“Netflix stock had a disappointing first half of 2021 performance, treading water while the S&P 500 rallied, after a very strong 67% return in 2020. It benefited from the global pandemic in 2020, signing on 36.6 million new subscribers vs the typical 25 million or so it typically does. Total subscribers exceeded 200 million, up 22% over the previous year. However, in the first half of 2021, new subscriber additions slowed substantially, totaling only 5.5 million due to slower new content additions impacted by production delays, a resumption of outdoor activity as people everywhere adjusted to living with COVID, and the impact of a “pull-forward effect” on subscriber growth in last year’s very strong results. The third quarter saw new content velocity start to pick up, which is usually what drives new subscribers to the service, with expectations of an even stronger content slate going into the final quarter of the year, causing the stock to increase 15% in the quarter.”
3. Bank of America Corporation (NYSE:BAC)
Sculptor Capital’s Stake Value: $398,218,000
Percentage of Sculptor Capital’s 13F Portfolio: 3.28%
Number of Hedge Fund Holders: 72
Bank of America Corporation (NYSE:BAC) is an American financial services corporation offering expertise in asset management, investment banking, commodities trading, equities trading, insurance and mortgage, risk management, and wealth management. Sculptor Capital holds a $398.2 million position in Bank of America Corporation (NYSE:BAC), which represents 3.28% of his Q3 portfolio.
Bank of America Corporation (NYSE:BAC) posted its Q3 results on October 14. EPS in the quarter totaled $0.85, beating estimates by $0.15. Revenue for the period amounted to $22.77 billion, up 11.33% from the prior-year quarter, topping estimates by $1.16 billion.
On November 23, Piper Sandler analyst Jeffery Harte raised the price target on Bank of America Corporation (NYSE:BAC) to $53 from $50 and kept an Overweight rating on the shares, citing the room for growth and upward revaluation exhibited by the latest expansions by the company.
One of the leading Bank of America Corporation (NYSE:BAC) stakeholders is Harris Associates, holding 59.4 million shares valued at $2.52 billion. Overall, as of September, 72 hedge funds were bullish on Bank of America Corporation (NYSE:BAC), down from 87 in the prior quarter.
Here is what Oakmark Funds has to say about Bank of America Corporation (NYSE:BAC) in its Q3 2021 investor letter:
“Earlier this year, one of our holdings, Bank of America, announced that it was raising its minimum hourly wage from $15 to $20 and would increase it to $25 by 2025. The company received great press for placing the well-being of its employees above profits. But was it really either/or? Bank of America’s chief human resources officer spoke to the bigger picture: “A core tenet of responsible growth is our commitment to being a great place to work…that includes providing strong pay and competitive benefits to help them and their families, so that we continue to attract and retain the best talent.” Bank of America understood that engaged, high-caliber employees are more productive, less prone to turnover and, therefore, less expensive in the long run. Increasing the pay for employees wasn’t elevating employees above shareholders; it was the right thing to do for employees and for shareholders.
If an increase to $20 was good, why stop there? Why not $50 per hour? Because the benefits the business receives at $50 don’t justify the expense. The bank would no longer be able to price its products competitively and would lose business. The employees would “win” in the short term, but eventually the lost business would lead to job cuts, meaning both employees and shareholders would lose. The negative effects of stakeholder overreach are no different than when CEOs overreach to inflate short-term profits. Both hurt shareholders and stakeholders.”
2. Starz Acquisition Llc (NASDAQ:STRZA)
Sculptor Capital’s Stake Value: $441,047,000
Percentage of Sculptor Capital’s 13F Portfolio: 3.63%
Number of Hedge Fund Holders: N/A
Starz Acquisition Llc (NASDAQ:STRZA) is an entertainment and media company that was acquired by Lions Gate Entertainment Corp. (NYSE:LGF-A) in 2016. As of Q3 2021, Starz Acquisition Llc (NASDAQ:STRZA) is one of the top stocks in Sculptor Capital’s investment portfolio, with the fund owning over 8.5 million shares in the company worth more than $441 million. The stock represents 3.63% of Sculptor’s total 13F investments.
Billionaire Warren Buffett’s Berkshire Hathaway is the leading stakeholder in Starz Acquisition Llc (NASDAQ:STRZA), as of September this year, with over 43 million shares worth more than $2 billion.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Sculptor Capital’s Stake Value: $461,988,000
Percentage of Sculptor Capital’s 13F Portfolio: 3.81%
Number of Hedge Fund Holders: 242
Amazon.com, Inc. (NASDAQ:AMZN) posted its Q3 results on October 28, with EPS for the quarter being $6.12, missing estimates by -$2.78. The $110.81 billion revenue also failed to meet analysts’ estimates by -$784.89 million.
Amazon.com, Inc. (NASDAQ:AMZN) is the largest holding in Sculptor Capital’s portfolio as of the third quarter, with the fund owning 140,634 Amazon.com, Inc. (NASDAQ:AMZN) shares worth $461.98 million, representing 3.81% of his Q3 investments.
JPMorgan analyst Doug Anmuth kept an Overweight rating on Amazon.com, Inc. (NASDAQ:AMZN) on November 24 with a $4,350 price target. He stated that U.S. online holiday sales will likely grow 14.5% year-over-year and Amazon.com, Inc. (NASDAQ:AMZN) should surpass Walmart Inc. (NYSE:WMT) as the largest U.S. retailer in 2022.
As of Q3 2021, 242 hedge funds in the database of 867 elite funds monitored by Insider Monkey were bullish on Amazon.com, Inc. (NASDAQ:AMZN), down from 271 in the preceding quarter. One of the leading Amazon.com, Inc. (NASDAQ:AMZN) stakeholders is Ken Fisher’s Fisher Asset Management, with a $6.3 billion position in the company.
Here is what Polen Capital has to say about Amazon.com, Inc. (NASDAQ:AMZN) in its Q3 2021 investor letter:
“Amazon has also lagged as its revenue growth is slowing on the very difficult comparisons from last year when this behemoth was growing revenue by over 40%. We still expect exceptional long-term growth and significant margin expansion as the fastest growing (and now large) segments of Amazon are also generating the highest margins.”
You can also take a look at Top 10 Stock Picks of Brad Farber’s Atika Capital and 10 New Stock Picks of Billionaire Stanley Druckenmiller.
