We recently published a list of Billionaire Steve Cohen’s Top 15 Stock Picks. In this article, we are going to take a look at where MACOM Technology Solutions Holdings, Inc. (NASDAQ:MTSI) stands against other Billionaire Steve Cohen’s top stock picks.
Steve Cohen is one of the most prominent and successful hedge fund managers in the world, known for his extraordinary trading acumen and ability to generate consistent returns. As the founder of Point72 Asset Management, Cohen has built a reputation as a pioneer in the hedge fund industry. He was born in 1956 into a middle-class family. His father worked in the garment industry, while his mother was a piano teacher. Cohen showed an interest in finance early on, even dabbling in poker, which honed his skills in risk-taking and probability analysis. He graduated from Wharton School of the University of Pennsylvania in 1978 with a degree in economics. Shortly after, he began his career on Wall Street as a junior trader at Gruntal & Co, where he quickly gained recognition for his ability to generate profits through equities trading.
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In 1992, Cohen founded SAC Capital Advisors with $25 million, including $10 million of his own savings. The hedge fund, named after his initials, focused on long/short equity strategies and became known for its aggressive trading style. Over the years, SAC Capital emerged as one of the most successful hedge funds in history, consistently delivering double-digit returns. At its peak, SAC Capital managed over $16 billion in assets. Cohen reportedly generated annualized returns of approximately 30% for his investors, an extraordinary achievement in the hedge fund industry. Cohen’s trading style emphasized speed, precision, and a deep understanding of market dynamics.
In 2014, Cohen launched Point72 Asset Management, a firm focused on managing his personal fortune and eventually reopening to external investors. Point72 has since grown into a major player in the hedge fund industry. As of the third quarter of 2024, Point72 manages over $39 billion in 13F securities. The firm employs over 1,800 people and operates across multiple global offices. Point72 combines Cohen’s expertise in active trading with investments in technology, data analysis, and artificial intelligence, positioning itself at the forefront of modern finance.
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For this article, we selected stocks by combing through the 13F portfolio of Point72 Asset Management at the end of the third quarter of 2024. These stocks are also popular among other hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
An aerial view of a semiconductor factory, with its intricate machinery and equipment.
MACOM Technology Solutions Holdings, Inc. (NASDAQ:MTSI)
Number of Hedge Fund Holders: 23
Point72 Asset Management’s Stake: $284.3 million
MACOM Technology Solutions Holdings, Inc. (NASDAQ:MTSI) is an American developer and producer of radio, microwave, and millimeter wave semiconductor devices and components. The following reasons highlight the company’s strength as an investment target. First of all, as per the report of the third quarter of 2024, reported revenue was $729.6 million, up 13% from FY 2023, and net income was $76.9 million, down 16% from FY 2023. Secondly, the company has also announced its long-term investment plan to modernize its Massachusetts and North Carolina semiconductor wafer fabrication facilities. MACOM’s (NASDAQ:MTSI) five-year strategic investment plan of up to $345 million is supported by a recently executed preliminary, non-binding agreement with the CHIPS Program Office, which would provide for proposed direct funding from the US Department of Commerce under the CHIPS and Science Act of up to $70 million. Moreover, the company has been selected to lead a development project to establish advanced gallium nitride on silicon carbide process technologies for radio frequency and microwave applications. The project will focus on developing semiconductor manufacturing processes for GaN-based materials and monolithic microwave integrated circuits operating efficiently at high voltage and at millimeter-wave frequencies.
Overall, MTSI ranks 5th on our list of Billionaire Steve Cohen’s top stock picks. While we acknowledge the potential of MTSI as an investment, our conviction lies in the belief that some stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a stock that is more promising than MTSI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
