In this article, we discuss the top 10 stocks of Edmond Safra’s EMS Capital. If you want to skip our detailed analysis of these stocks, go directly to Edmond Safra’s EMS Capital’s Top 5 Stocks.
Edmond Safra founded EMS Capital in 2007. The New York-based firm acts as an investment advisor to a global macro fund and a global long/short equity fund, with the investment portfolio concentrated in the information technology, consumer staples, utilities and telecommunications, real estate, finance, consumer discretionary, and communications sectors. EMS Capital has a top ten holdings concentration of 71.32%.
Edmond Safra manages a portfolio worth $1.27 billion on behalf of EMS Capital, in addition to overseeing assets under management valued over $3 billion as per the 13F filings at the end of June this year. The largest stock in Safra’s portfolio is Meta Platforms, Inc. (NASDAQ:FB), with an approximate stake value of $198.71 million.
As of the Q2 13F filings, EMS Capital purchased 8 new stocks, bought additional stakes in 12 securities, and sold out of 7 equities. Safra’s top buys for the second quarter were salesforce.com, inc. (NYSE:CRM), Twilio Inc. (NYSE:TWLO), and Amazon.com, Inc. (NASDAQ:AMZN). Whereas, he sold out of NIKE, Inc. (NYSE:NKE), Zillow Group, Inc. (NASDAQ:Z), and PayPal Holdings, Inc. (NASDAQ:PYPL), among others.
The most notable stocks in Edmond Safra’s portfolio for the second quarter were Meta Platforms, Inc. (NASDAQ:FB), salesforce.com, inc. (NYSE:CRM), Amazon.com, Inc. (NASDAQ:AMZN), and Uber Technologies, Inc. (NYSE:UBER), among others discussed in detail below. These stocks are highly sought after by the smart money as well.
Photo by Tech Daily on Unsplash
Why should we pay attention to hedge fund sentiment while choosing 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 S&P 500 ETF (SPY). Our stock picks outperformed the market by more than 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.
Our Methodology
We compiled the list of the top 10 stocks according to Edmond Safra’s EMS Capital by using Safra’s Q2 investment portfolio, ranking the stocks according to the value of each holding.
To give more context on each stock, we have mentioned the number of hedge fund holders, earnings for the third quarter, and analyst ratings.
Edmond Safra’s EMS Capital’s Top Stocks
10. Snap Inc. (NYSE:SNAP)
EMS Capital’s Stake Value: $54,605,000
Percentage of EMS Capital’s 13F Portfolio: 4.27%
Number of Hedge Fund Holders: 64
Snap Inc. (NYSE:SNAP) is a social media company which has revolutionized the art of communication and self expression via pictures, and categorizes itself as a camera company. The media products offered by Snap Inc. (NYSE:SNAP) include Snapchat, Bitmoji, Spectacles, Looksery, and Zenly. Snap Inc. (NYSE:SNAP) is a top stock according to Edmond Safra, and EMS Capital owns 801,366 shares in the social media company. These shares are valued at $54.6 million and represent 4.27% of Safra’s 13F portfolio as of June this year.
Snap Inc. (NYSE:SNAP) reported earnings for the third quarter on October 21. The Q3 EPS came in at $0.17, beating estimated EPS by $0.09. The daily active users in Q3 for Snap Inc. (NYSE:SNAP) are 306 million, as compared to 293 million in the preceding quarter.
Citi analyst Jason Bazinet on November 1 upgraded Snap Inc. (NYSE:SNAP) from Sell to Neutral, with a $53 price target, down from $67, owing to the Q3 earnings.
As of the second quarter of 2021, 64 hedge funds tracked by Insider Monkey were bullish on Snap Inc. (NYSE:SNAP), down from 73 in the previous quarter.
Here is what RiverPark Funds has to say about Snap Inc. (NYSE:SNAP) in its Q2 2021 investor letter:
“Snap shares were a top contributor for the quarter as well, also driven by strong first quarter results. The company reported accelerating revenue growth of 66% for the period (up from 62% fourth quarter growth), driven by user growth of 22%, and a 36% expansion in average revenue per user (ARPU). The company also guided to stronger-than-expected and accelerating 81%-85% revenue growth for second quarter 2021. Adjusted EBITDA improved by $79 million year over year for a break-even margin, up 1,800 basis points, and free cash flow improved dramatically, turning positive for the period to $126 million. Snap also continued to roll-out products that should help drive further expansion in user growth and ARPU, including Spotlight, a TikTok-like experience, with more than 125 million Snapchatters using it during March, and original programming starring Ryan Reynolds.
With TTM of $2.8 billion in revenue and an ARPU that is about 1/2 that of Twitter and 1/3 that of Facebook, we believe Snap has a long runway for both revenue growth and expanded profitability as it improves its platform functionality, grows its audience, and continues to advance its monetization.”
9. Peloton Interactive, Inc. (NASDAQ:PTON)
EMS Capital’s Stake Value: $56,702,000
Percentage of EMS Capital’s 13F Portfolio: 4.44%
Number of Hedge Fund Holders: 67
Peloton Interactive, Inc. (NASDAQ:PTON), a top stock pick of Safra’s EMS Capital, is an exercise equipment company from New York City. Peloton Interactive, Inc. (NASDAQ:PTON) is known for its smart bicycles and treadmills, which are connected to the internet and users can stream online exercise classes, which Peloton Interactive, Inc. (NASDAQ:PTON) offers on a monthly subscription basis. In addition to exercise equipment, Peloton Interactive, Inc. (NASDAQ:PTON) also sells athleisure and accessories via their application and website.
EMS Capital, as of June this year, owns 457,200 shares in Peloton Interactive, Inc. (NASDAQ:PTON), worth $56.7 million, representing 4.44% of the firm’s 13F portfolio.
Of the 873 hedge funds tracked by Insider Monkey, 67 funds were bullish on Peloton Interactive, Inc. (NASDAQ:PTON) at the end of Q2, up from 64 in Q1.
Peloton Interactive, Inc. (NASDAQ:PTON) reported on November 4 earnings for the third quarter. The Q3 EPS came in at -$1.10, beating estimates by $0.04. Revenue for the quarter was $805.20 million, missing estimated revenue by -$3.67 million.
Roth Capital analyst George Kelly, on November 8, kept a Buy rating on Peloton Interactive, Inc. (NASDAQ:PTON), lowering the price target from $125 to $70. This rating followed the Q3 results, and the analyst is positive that Peloton Interactive, Inc. (NASDAQ:PTON) can increase its subscriber base in the future by offering new products at affordable prices.
In addition to Meta Platforms, Inc. (NASDAQ:FB), salesforce.com, inc. (NYSE:CRM), Amazon.com, Inc. (NASDAQ:AMZN), and Uber Technologies, Inc. (NYSE:UBER), Peloton Interactive, Inc. (NASDAQ:PTON) is a top stock pick of Edmond Safra as of the second quarter.
Here is what Carillon Tower Advisers has to say about Peloton Interactive, Inc. (NASDAQ:PTON) in its Q2 2021 investor letter:
“Peloton Interactive operates a connected fitness platform offering live and on-demand classes allowing users to exercise at home. The firm’s shares were pressured in the quarter after Peloton announced a voluntary recall for both its legacy treadmill (Peloton Tread+) and its newly-launched base model treadmill (Peloton Tread). The issue surrounding the latter is somewhat troubling, as it appears it may be the result of an engineering flaw. This new treadmill offering was expected to be a key growth driver in the second half of 2021, and this development reduces our confidence in Peloton’s product pipeline. Therefore, we sold the stock.”
8. Amazon.com, Inc. (NASDAQ:AMZN)
EMS Capital’s Stake Value: $59,707,000
Percentage of EMS Capital’s 13F Portfolio: 4.67%
Number of Hedge Fund Holders: 271
Amazon.com, Inc. (NASDAQ:AMZN) is a top stock pick of Edmond Safra, as of June this year, with EMS Capital owning 17,356 shares in Amazon.com, Inc. (NASDAQ:AMZN), valued at $59.7 million, representing 4.67% of the firm’s investment portfolio. Amazon.com, Inc. (NASDAQ:AMZN) partnered with Allegiant Travel Company (NASDAQ:ALGT) on November 8, signing a five-year contract with the company to be their sole cloud provider. Similarly, Teradata Corporation (NYSE:TDC) also entered a three-year deal with Amazon.com, Inc. (NASDAQ:AMZN) on November 3, to increase product integrations and development with Amazon Web Services.
As of the second quarter of 2021, 271 hedge funds tracked by Insider Monkey reported owning stakes in Amazon.com, Inc. (NASDAQ:AMZN), with stakes worth over $60 billion. This is compared to 243 funds in the preceding quarter, with an approximate stake value of more than $50 billion.
Citi analyst Jason Bazinet on November 2 kept a Buy rating on Amazon.com, Inc. (NASDAQ:AMZN), but lowered the price target from $4,175 to $4,100 owing to the poor Q3 performance. However, he sees sufficient room for growth in Amazon.com, Inc. (NASDAQ:AMZN)’s B2B business.
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.”
7. Alexander’s, Inc. (NYSE:ALX)
EMS Capital’s Stake Value: $67,121,000
Percentage of EMS Capital’s 13F Portfolio: 5.26%
Number of Hedge Fund Holders: 13
Alexander’s, Inc. (NYSE:ALX) is a real estate investment trust that is managed by Vornado Realty Trust (NYSE:VNO), who is a majority owner of Alexander’s, Inc. (NYSE:ALX). Alexander’s, Inc. (NYSE:ALX) specializes in leading, managing, developing, and redeveloping properties. Its current portfolio of assets includes six properties in New York, including 731 Lexington Avenue, which houses the headquarters of Bloomberg, L.P. EMS Capital owns stakes worth $67.1 million in Alexander’s, Inc. (NYSE:ALX), which represents 5.26% of the firm’s Q2 portfolio.
As of the second quarter, 13 hedge funds in the exclusive database of Insider Monkey were long Alexander’s, Inc. (NYSE:ALX), up from 7 in the previous quarter.
The Q3 FFO for Alexander’s, Inc. (NYSE:ALX) came in at $4.13 on November 1, missing estimates by -$0.70. Revenue for the quarter also failed to meet analysts’ expected revenue by -$5.15 million, coming in at $48.95 million.
Piper Sandler analyst Alexander Goldfarb on November 1 downgraded Alexander’s, Inc. (NYSE:ALX) from Neutral to Underweight, lowering the price target to $270 from $300, owing to the Q3 performance. He believes that Alexander’s, Inc. (NYSE:ALX) won’t rebound on performance until vacant retail spaces are sublet, and reduced his FFO estimates for 2021 and 2022 as a result.
Like Meta Platforms, Inc. (NASDAQ:FB), salesforce.com, inc. (NYSE:CRM), Amazon.com, Inc. (NASDAQ:AMZN), and Uber Technologies, Inc. (NYSE:UBER), Alexander’s, Inc. (NYSE:ALX) is a notable stock in Safra’s Q2 portfolio.
6. Twilio Inc. (NYSE:TWLO)
EMS Capital’s Stake Value: $78,864,000
Percentage of EMS Capital’s 13F Portfolio: 6.18%
Number of Hedge Fund Holders: 98
Twilio Inc. (NYSE:TWLO), one of Safra’s top stock picks, is a cloud communications platform that enables phone calls, text messages, and other modes of communications for software developers by utilizing its application programming interface. EMS Capital owns 200,080 shares in Twilio Inc. (NYSE:TWLO), worth $78.86 million, making up 6.18% of the firm’s portfolio as of June.
From Insider Monkey’s database of elite funds, 98 hedge funds reported owning stakes in Twilio Inc. (NYSE:TWLO) at the end of June this year, down from 99 in the preceding quarter.
On October 27, Twilio Inc. (NYSE:TWLO) reported earnings for the third quarter, with the EPS coming in at $0.01, beating estimates by $0.15.
Wells Fargo analyst Michael Turrin on October 28 lowered the price target for Twilio Inc. (NYSE:TWLO) from $525 to $450, keeping an Overweight rating on the stock.
Here is what Lakehouse Capital has to say about Twilio Inc. (NYSE:TWLO) in its Q2 2021 investor letter:
“The Fund held 20 positions as of the end of June and exited four during the year (including) Twilio. The companies we exited were sold almost entirely on the basis of their valuations getting stretched well past their norms and to levels where the return profile no longer offered the asymmetric upside that led us to invest in the first place. We dislike selling on valuation as great growth companies are hard to find and letting winners run is an important facet of a winning growth strategy, however, we’re not gluttons for punishment either and in each of those cases we redeployed capital towards other high-quality growth companies with less demanding valuations.”
Click to continue reading and see Edmond Safra’s EMS Capital’s Top 5 Stocks.
Suggested articles:
- 10 Stocks to Buy in 2021 According to Guy Spier’s Aquamarine Capital
- 10 Stocks to Buy According to Bluegrass Capital Partners
- 10 Stocks Making Noise After Releasing Their Earnings Reports
Disclosure: None. Edmond Safra’s EMS Capital’s Top 10 Stocks is originally published by Insider Monkey.
