We recently published a list of Billionaire Louis Bacon’s Top 10 Long-Term Stock Picks. In this article, we are going to take a look at where The Allstate Corporation (NYSE:ALL) stands against other Billionaire Louis Bacon’s long-term stock picks.
Louis Bacon is one of the most prominent and successful hedge fund managers of his generation, known for his astute macroeconomic insights and ability to navigate volatile markets. As the founder of Moore Capital Management, Bacon built a reputation for delivering exceptional returns while maintaining a disciplined approach to risk management. Louis Moore Bacon was born in 1956 into a family with roots in business and the outdoors. His father, Louis Turner Bacon, was a businessman and chairman of the Reynolds Securities brokerage firm. These early influences shaped Bacon’s interest in finance and conservation. Bacon attended Middlebury College, where he earned a degree in American Literature, and later pursued an MBA at Columbia Business School, graduating in 1981. His education laid the groundwork for his successful career in trading and investment management.
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Bacon started his financial career on the trading desk of Bankers Trust. Later, he joined Shearson Lehman Brothers, where he developed expertise in trading currencies, commodities, and futures. His early experiences as a trader honed his ability to identify macroeconomic trends, a skill that would define his investment strategy. In 1987, Bacon used a $25,000 inheritance to establish his own trading account. His success during the stock market crash of October 1987, when he profited by shorting the market, demonstrated his ability to capitalize on turbulent conditions. In 1989, Louis Bacon founded Moore Capital Management with $25,000 of his own money and $1.6 million in seed capital. The hedge fund focused on global macroeconomic investing, a strategy that involves analyzing and trading based on macroeconomic trends such as interest rates, currencies, and commodities.
Bacon’s success was rapid and significant. In its first year, Moore Capital posted a return of 86%, showcasing Bacon’s skill in navigating volatile markets. Over the decades, Moore Capital became one of the most successful hedge funds in the industry, managing more than $14 billion at its peak. Over three decades, Moore Capital delivered annualized returns of approximately 17%, outperforming most hedge funds. Bacon’s ability to generate profits during financial downturns, such as the 2008 global financial crisis, solidified his reputation as a skilled macro trader. At the end of the third quarter of 2024, the 13F portfolio of the fund was worth more than $5.4 billion with the top holdings in the technology and financial sectors.
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For this article, we selected stocks by combing through the 13F portfolio of Moore Global Investments at the end of the third quarter of 2024. Only the companies that have been in the 13F portfolio of the fund consistently for the past three years were selected. 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).
The Allstate Corporation (NYSE:ALL)
Number of Hedge Fund Holders: 62
Moore Global Investments’ Stake: $45.7 million
The Allstate Corporation (NYSE:ALL) is one of the largest publicly held personal lines insurers in the United States. There are several key elements that position this company as an appealing choice for investors. Firstly, promising financial growth is depicted in the report for the third quarter of 2024. For instance, total revenues of $16.6 billion in the third quarter of 2024 were $2.1 billion or 14.7% above the prior-year quarter, driven by increased Property-Liability earned premium. Revenues increased by almost 15% from the prior year, net income was $1.2 billion for the quarter, and adjusted net income return on equity was 26.1% for the prior twelve months. Secondly, The Allstate Corporation (NYSE:ALL) has launched two new investment funds, including a long-term strategic fund that aims to protect the parent company against future risks such as climate change.
Overall, ALL ranks 2nd on our list of Billionaire Louis Bacon’s long-term stock picks. While we acknowledge the potential of ALL 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 ALL 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.