We recently published a list of 10 Best Stocks to Buy According to Billionaire David Einhorn. In this article, we are going to take a look at where Roivant Sciences Ltd. (NASDAQ:ROIV) stands against other best stocks to buy according to billionaire David Einhorn.
David Einhorn is a highly regarded hedge fund manager, who co-founded Greenlight Capital in 1996. Einhorn shot to fame after he correctly forecasted the collapse of Lehman Brothers during the financial crisis. He graduated from Cornell University and garnered his skills in the hedge fund industry under the mentorship of Gary Siegler and Peter Collery at the SC Fundamental Value Fund. Due to his prowess in long/short equity strategies, David Einhorn is being tagged as one of the most successful hedge fund managers.
Greenlight Capital’s Investment Philosophy
Greenlight Capital specializes in value-oriented strategies. The investment management firm primarily focuses on long and short positions in the listed equity securities and selectively engages in distressed debt investments during favorable economic cycles. Einhorn is a highly-regarded hedge fund manager who uses a long-short investment strategy. Because of this strategy, he can capitalize on both rising and falling markets, providing him flexibility during uncertainties.
The Greenlight Capital funds (the Partnerships) managed to return 7.2% in 2024, net of fees and expenses, as compared to 25.0% for the broader S&P 500 index. However, since the inception of Greenlight Capital, the Partnerships returned 3,117% cumulatively or 12.9% annualized, both net of fees and expenses. Over the same period, the S&P 500 index delivered 1,421% or 10.0% annualized. Notably, Greenlight’s investors earned $5.7 billion, net of fees and expenses, since inception.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
Greenlight Capital’s Views on Current Market Dynamics
CNBC, while quoting the comments of Greenlight Capital’s David Einhorn, mentioned that speculative behavior in the current bull market has reached beyond common sense. As per the firm’s Q4 2024 investor letter, the investors continue to experience a ‘Fartcoin’ stage of the market cycle. To give a brief context, Fartcoin is a cryptocurrency that came into existence late last year. Apart from trading and speculation, no other obvious purpose is being served and no need that is not being served elsewhere is being fulfilled. Einhorn went on to add that the investors might be leaving the Fartcoin stage of the market and entering the Trump (and Melania) memecoin stage. While the certainty about the possible outcome remains unpredictable, it is going to be wild, says David Einhorn.
Amidst these trends, let us now have a look at the 10 Best Stocks to Buy According to Billionaire David Einhorn.
Our Methodology
To list the 10 Best Stocks to Buy According to Billionaire David Einhorn, we selected the top 10 stocks in Greenlight Capital’s portfolio as per its Q4 2024 13F filing. We settled on the hedge fund’s 10 biggest holdings. Finally, we ranked the stocks in ascending order based on the value of Greenlight Capital’s equity stakes. Additionally, we have mentioned the hedge fund sentiment around each stock, as of Q4 2024.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A research scientist in a lab coat examining a sample of blood for sickle cell diseases.
Roivant Sciences Ltd. (NASDAQ:ROIV)
Greenlight Capital’s Stake Value: $62.3 million
Number of Hedge Fund Holders: 44
Roivant Sciences Ltd. (NASDAQ:ROIV) is a commercial-stage biopharmaceutical company, which is engaged in the development and commercialization of medicines for inflammation and immunology areas. Analyst David Risinger from Leerink Partners reiterated a “Buy” rating on the company’s stock, providing a price objective of $17.00. The analyst’s rating is backed by factors demonstrating the company’s promising future. Roivant Sciences Ltd. (NASDAQ:ROIV) is anticipated to make strong progress in 2025 with the help of critical pipeline developments that can favorably impact the stock.
Elsewhere, Douglas Tsao, an analyst from H.C. Wainwright, reiterated a “Buy” rating on the company’s stock. The associated price target remained same at $18.00. The rating stemmed from factors related to the company’s strategic advancements and promising opportunities. Roivant Sciences Ltd. (NASDAQ:ROIV) has broadened its clinical pipeline with the newly announced trial of brepocitinib in cutaneous sarcoidosis (CS). As with dermatomyositis and non-infectious uveitis, brepocitinib can be the first-in-class agent for CS and expands the treatment options for patients suffering from an indication with high unmet need.
Tourlite Capital Management, an investment management firm, released a Q4 2024 investor letter. Here is what the fund said:
“We continue to believe Roivant Sciences Ltd. (NASDAQ:ROIV) offers an attractive risk reward and multiple ways to win. Excluding Roivant’s cash balance and Immunovant (IMVT) stake, the remainder of Roivant (ROIV stub) is valued at less than $2 per share. We believe Roivant’s stake in Arbutus and its exposure to the LNP litigation could alone be worth up to $4. In addition to ROIV, we remain shareholders in Arbutus.”
Overall, ROIV ranks 10th on our list of the 10 Best Stocks to Buy According to Billionaire David Einhorn. While we acknowledge the potential of ROIV as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued AI stock that is more promising than ROIV 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.
