In this article, we will take a look at the top 5 stocks in Dev Kantesaria’s Q2 portfolio. If you wish to see our detailed analysis of Kantesaria’s history, investment philosophy, and hedge fund performance, go directly to Dev Kantesaria’s Stock Portfolio: Top 9 Stocks.
5. Amazon.com, Inc. (NASDAQ:AMZN)
Valley Forge Capital Management’s Stake Value: $270.79 million
Percentage of Valley Forge Capital Management’s 13F Portfolio: 10.52%
Number of Hedge Fund Holders: 271
Multinational e-commerce giant Amazon.com, Inc. (NASDAQ:AMZN), considered to be the world’s most valuable brand, is one of the Big Five companies in the US information technology sector.
On October 21, Baird analyst Colin Sebastian maintained an Outperform rating on Amazon.com, Inc. (NASDAQ:AMZN), alongside a $4000 price target on its shares.
Of the 873 elite funds tracked by Insider Monkey, 271 held stakes in Amazon.com, Inc. (NASDAQ:AMZN) worth $60.49 billion in the second quarter of 2021, compared to 243 funds in the first quarter with total stakes amounting to around $50.4 billion.
Valley Forge Capital Management, as of Q2 2021, holds 78,715 shares in the company, worth more than $270.79 million, and representing 10.52% of the investment firm’s portfolio.
Ken Fisher’s Fisher Asset Management is among the most notable stakeholders in Amazon.com, Inc. (NASDAQ:AMZN), with over 1.87 million shares worth more than $6.45 billion.
Madison Funds, in its Q3 2021 investor letter, mentioned Amazon.com, Inc. (NASDAQ:AMZN). Here is what the fund had to say:
“We did add a modest new position weight to the portfolio in the quarter in Amazon.com, Inc. stock (AMZN). We acknowledge that many aspects of Amazon’s merit as an investment are well appreciated. However, our work leads us to conclude that shares are attractive. Leadership positions in both e-commerce and cloud computing provide the company with significant durable competitive advantages in industries that we think can produce above average growth over the next decade. Over the past year, AMZN shares have trailed the market as investors debate near-term growth prospects following the pandemic-induced e-commerce demand. Additionally, margins have been depressed due to Amazon’s unprecedented increases in spending to build out fulfillment and in-house logistics capabilities – Amazon will build out more square footage this year and last than it did cumulatively over the previous 10 years, more than doubling its in-house delivery capacity. We like the investments Amazon is making and believe they will further advantage the company relative to other retailers, making it nearly impossible for competitors to match the same level of delivery speed and convenience. With its large and frequently engaged customer base, Amazon has multiple mechanisms to make money, including selling advertising and enhanced subscription services. Within the cloud business, we forecast Amazon Web Services (AWS) leveraging its strengths in Infrastructure-as-a-service (IaaS) to move into higher value segments of cloud computing (such as platform-as-a-service: PaaS), allowing the company to continue outgrowing the overall IT sector with strong profitability. While Amazon shares have performed extremely well over the long-term, we think near-term concerns about whether Amazon will earn a return on its accelerated investments provide an opportunity now for investors willing to look through the investment period. Our view is that the investments likely earn strong returns and extend Amazon’s competitive advantages and aboveaverage growth.”
4. Fair Isaac Corporation (NYSE:FICO)
Valley Forge Capital Management’s Stake Value: $337.5 million
Percentage of Valley Forge Capital Management’s 13F Portfolio: 13.11%
Number of Hedge Fund Holders: 28
Fair Isaac Corporation (NYSE:FICO) is a data analytics company based in San Jose, California, that provides credit scoring services in the United States. Its FICO score, a measure of consumer credit risk, has become a fixture of consumer lending in the country.
On October 8, RBC Capital analyst Ashish Sabadra lowered his price target on Fair Isaac Corporation (NYSE:FICO) to $463 from $550, and kept a Sector Perform rating on the shares of the company. The analyst notes that the company’s valuation looks “attractive” after the stock’s pullback.
According to the second quarter securities filings, Dev Kantesaria’s hedge fund holds 671,509 shares in Fair Isaac Corporation (NYSE:FICO), worth more than $337.5 million.
Gabriel Plotkin of Melvin Capital Management is one of the biggest stakeholders in the company as of the end of the second quarter, according to the data tracked by Insider Monkey.
Overall, 28 funds were bullish on Fair Isaac Corporation (NYSE:FICO) by the end of the June quarter, compared to 27 in the previous quarter.
Richie Capital Group, in its Q3 2021 investor letter, mentioned Fair Isaac Corporation (NYSE:FICO). Here is what the fund had to say:
“Fair Isaac Corp (FICO – down 18.84%) – The stock price for the predictive analytics software firm has declined off of very little news outside of an article in the Wall Street Journal highlighting the increasing competitive threats. We view much of this as known. Anytime a company dominates a market in a monopoly-like manner, it will naturally attract competitors as well as customers who will attempt to push back on pricing. However, their solutions are highly predictive within the subprime market and the company continues to identify new opportunities for their software solutions. FICO reported a solid Q3 in August beating earnings and revenue estimates. The report seemed to imply slowing revenue growth, specifically in their DMS and Applications revenue. We believe the market is missing the bigger picture. FICO is transitioning from a licensing model to a subscription model. These transitions typically lead to near term growth headwinds but longerterm profitability improvement and stickier customers. FICO’s scores revenue continues to grow at a double-digit annual rate, and margins (Gross, Operating, and Net Income) are expanding which supports the premise that the company is maintaining their pricing power. We view this decline as a buying opportunity. Management seems to agree with our thinking as they announced a $500M stock repurchase program on August 18th.”
3. Moody’s Corporation (NYSE:MCO)
Valley Forge Capital Management’s Stake Value: $418.6 million
Percentage of Valley Forge Capital Management’s 13F Portfolio: 16.26%
Number of Hedge Fund Holders: 44
Moody’s Corporation (NYSE:MCO) is a New York-based credit rating and risk management company that assigns evaluates bonds and stocks based on the investment risk they possess.
As of Q2 2021, Valley Forge Capital Management holds over 1.15 million shares in Moody’s Corporation (NYSE:MCO). These shares amount to more than $418.6 million and account for 16.26% of the fund’s total investment portfolio.
On September 7, Oppenheimer analyst Owen Lau raised the price target on Moody’s Corporation (NYSE:MCO) to $418 from $406, and maintained an Outperform rating on the shares of the company.
By the end of the second quarter of 2021, 44 hedge funds out of the 873 tracked by Insider Monkey held stakes in Moody’s Corporation (NYSE:MCO) worth roughly $16 billion. This is compared to 55 hedge funds in the previous quarter with a total stake value of approximately $13.7 billion.
According to our database, Warren Buffett’s Berkshire Hathaway is the leading shareholder in the company, with over 24.6 million shares, worth approximately $8.93 billion.
In the Q2 2021 investor letter of Qualivian Investment Partners, the fund mentioned Moody’s Corporation (NYSE: MCO). Here is what the fund said:
“Moody’s: Revenue, operating profit margins, and EPS all exceeded expectations, and annual guidance for these items (and for free cash flow) was raised. In MIS (Moody’s Investors Service) which houses the traditional ratings business, the outlook for debt issuance was raised for the remainder of the year, while MA (Moody’s Analytics) also came in ahead of expectations. The company leveraged strong revenue growth with strong operating profit margin improvement of 200 bps, with EPS coming in $0.22 ahead of consensus estimates. Management alluded to having interesting opportunities in their M&A pipeline, which we will have to assess when the time comes, but Moody’s management team has been very effective at allocating capital in the past toward value-creating bolt-on acquisitions, especially in their Moody’s Analytics business, a key growth driver for the company.”
2. Mastercard Incorporated (NYSE:MA)
Valley Forge Capital Management’s Stake Value: $493.8 million
Percentage of Valley Forge Capital Management’s 13F Portfolio: 19.18%
Number of Hedge Fund Holders: 156
A global leader in payment innovation and technology, Mastercard Incorporated (NYSE:MA) is a financial services company, based in New York.
At the end of the second quarter of 2021, 156 hedge funds in the database of Insider Monkey held stakes worth $17.10 billion in Mastercard Incorporated (NYSE:MA), up from 154 the preceding quarter worth $17.09 billion.
Based on the 13F Filings for the second quarter of 2021, Dev Kantesaria held 1.35 million shares in the company, worth more than $493.8 million. These shares represented 19.18% of his hedge fund’s total portfolio value.
On October 29, Raymond James analyst John Davis reiterated an Outperform rating on Mastercard Incorporated (NYSE:MA), alongside a price target of $430 on its shares.
Alexander Becker of Codex Capital is another prominent shareholder in Mastercard Incorporated (NYSE:MA), with 23,200 shares, worth more than $8.46 billion.
In the Q2 2021 investor letter of Qualivian Investment Partners, the fund mentioned Mastercard Incorporated (NYSE:MA). Here is what the fund said:
“Mastercard: Q2 revenue and EPS beat consensus estimates by 3.7% and 12% respectively. Operating margins also beat consensus by +240 bps. Gross domestic volume growth of +38.3% (+32.8% in constant currency) was buttressed by continued e-commerce strength and better in-store performance, while purchase volumes grew 41.8% (35.5% in constant currency). Cross border performance was strong, but durability remains uncertain given uncertainty arising from the Delta variant and its impact on travel and tourism. We believe Mastercard has a robust runway for growth given further travel recovery, new/existing partnerships, traction in digital payments, and ongoing economic recovery.”
1. S&P Global Inc. (NYSE:SPGI)
Valley Forge Capital Management’s Stake Value: $522.3 million
Percentage of Valley Forge Capital Management’s 13F Portfolio: 20.29%
Number of Hedge Fund Holders: 71
S&P Global Inc. (NYSE:SPGI) is a company that provides financial information and analytics, operating through its S&P Global Ratings, S&P Global Market Intelligence and S&P Global Dow Jones Indices segments.
On September 16, Oppenheimer analyst Owen Lau raised his price target on S&P Global Inc. (NYSE:SPGI) to $550 from $476, and kept an Outperform rating on the shares of the firm.
Dev Kantesaria’s Valley Forge Capital Management currently holds over 1.27 million shares in S&P Global Inc. (NYSE:SPGI). These shares are valued at approximately $522.3 million and represent 20.29% of the fund’s investment portfolio.
Of the 873 elite funds tracked by Insider Monkey, 71 were long in S&P Global Inc. (NYSE:SPGI) at the end of June, up from 66 in the first quarter of 2021. Chris Hohn of TCI Fund Management is the leading stakeholder of the company.
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