Jim Simons’ Quant Hedge Fund is Buying These 10 Stocks

Published September 28, 2021 at 1:10 pm EDT Updated September 7, 2026 at 1:38 pm EDT

In this article we will take a look at the 10 stocks Jim Simons’ quant hedge fund is buying.

Billionaire investor and mathematician Jim Simons is known as the ‘Quant King’ in the world of hedge funds, owing to the staggering success of his New York-based quantitative trading hedge fund, Renaissance Technologies. After an esteemed career in academia, Simons eventually stepped into the world of finance in 1978 and founded Monemetrics, the preceding hedge fund to Renaissance Technologies. After few years of experimenting in financing, Jim Simons realized that he could make use of quantitative analysis to make investment gains from market inefficiencies. Thus he began his approach towards investing by solely applying mathematical and statistical modeling and research to interpret market data, searching for non-random movements in the financial data of the stocks he considered trading, thereby predicting future returns in his investments.

Ever since its formation, the Medallion hedge fund, Jim Simons’ secretive fund and a flagship of Renaissance, has produced groundbreaking results despite being closed to outside investors, with $55 billion in profits over the last 28 years. Renaissance Technologies, as an investment fund, manages more than $80 billion in its investment portfolio. Renaissance Technologies’ portfolio is diversified across 13 distinct sectors, with the Healthcare sector as the largest, accounting for 15.6% of the fund’s total portfolio. A majority of the companies in the fund’s portfolio are large-cap stocks, with stocks sizing up to more than $10 billion in market cap making up 12% of the fund’s total value.

Some of the notable stocks present in the investment portfolio of Renaissance Technologies at the end of the second quarter of 2021 include Amazon.com, Inc. (NASDAQ:AMZN), Alphabet Inc. (NASDAQ:GOOG), Moderna, Inc. (NASDAQ:MRNA), Microsoft Corporation (NASDAQ:MSFT) and NVIDIA Corporation (NASDAQ:NVDA), among others discussed in detail below.

Jim Simons' Quant Hedge Fund is Buying These 10 Stocks

Jim Simons of Renaissance Technologies

Our Methodology

With this background in mind, let us now look towards the 10 best stocks to buy according to Jim Simons’ Renaissance Technologies. We made use of Renaissance Technologies’ 13F portfolio for the second quarter for this analysis. The following list will consist of the top stocks that were added to Renaissance Technologies’ portfolio in the second quarter of 2021.

Why should we pay attention to Jim Simons’ 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 SPY. Our stock picks outperformed the market by 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.

10. Analog Devices, Inc. (NASDAQ:ADI)

Simons’ Stake Value: $101.4 million

Percentage of Jim Simons’ 13F Portfolio: 0.12%

Number of Hedge Fund Holders: 62

Analog Devices, Inc. (NASDAQ:ADI) is a Massachusetts-based technology company that manufactures and sells integrated circuits, software, and other components worldwide. Ranked tenth on the list of the 10 stocks Jim Simons’ quant hedge fund is buying, Analog Devices, Inc. has a market capitalization of $94.9 billion.

Jim Simons’ Renaissance Technologies currently holds over 589,196 shares of Analog Devices, Inc., amounting to over $101.4 million in worth and accounting for 0.12% of the fund’s investment portfolio. At the end of the second quarter of 2021, 62 hedge funds in the database of Insider Monkey held stakes worth $5.7 billion in Analog Devices, Inc., up from 50 the preceding quarter worth $4.8 billion.

For the second quarter of 2021, Analog Devices, Inc. reported earnings per share at $1.54, beating market estimates by $0.09. The company also reported revenues of $1.66 billion, surpassing estimates by $47.46 million.

On September 9, Deutsche Bank analyst Ross Seymore raised the firm’s price target on Analog Devices, Inc. to $175 from $170 and kept a Hold rating on the shares.

In its Q4 2020 investor letter, Weitz Investment Management, an asset management firm, highlighted a few stocks and Analog Devices, Inc. was one of them. Here is what the fund said:

”Analog Devices benefited from several global, long-wave trends such as automation, electric vehicles and the 5G network build-out. The company’s quarterly sales into the auto, industrial and communications sectors exceeded expectations, giving the stock a lift.”

9. Airbnb, Inc. (NASDAQ:ABNB)

Simons’ Stake Value: $107.8 million

Percentage of Jim Simons’ 13F Portfolio: 0.13%

Number of Hedge Fund Holders: 58

Airbnb, Inc. (NASDAQ:ABNB) is a rental company that provides an online marketplace for lodging, catering primarily to tourists. Ranked ninth on the list of the 10 stocks Jim Simons’ quant hedge fund is buying, Airbnb, Inc. has a market capitalization of $109.55 billion.

Jim Simons’ Renaissance Technologies currently holds over 704,157 shares of Airbnb, Inc., amounting to over $107.8 million in worth and accounting for 0.13% of the fund’s investment portfolio. At the end of the second quarter of 2021, 58 hedge funds in the database of Insider Monkey held stakes worth $2.7 billion in Airbnb, Inc., up from 52 hedge funds in the preceding quarter worth $2.4 billion.

On August 12, Airbnb, Inc. issued its quarterly earnings report for the second quarter of 2021, with reported earnings per share at -$0.11, beating estimates by $0.32. Additionally, the company also reported revenues of $1.34 billion, surpassing estimates by $64.79 million.

On August 17th, Citi boosted the target price of Airbnb, Inc. from $149 to $152 with a Neutral rating.

Just like Amazon.com, Inc., Alphabet Inc., Moderna, Inc., Microsoft Corporation and NVIDIA Corporation, Airbnb, Inc. has a notable position in Jim Simons’ portfolio.

In the Q2 2021 investor letter of Worm Capital, the fund mentioned Airbnb, Inc.. Here is what the fund said:

“Throughout the quarter, you may have noticed that we averaged into a significant position in Airbnb (ABNB). Though the stock has been a relative underperformer since its February highs, we are highly confident about the company’s prospects and its ability to generate meaningful compounded returns over time.

Some history: We have been following Airbnb’s journey for several years, long before the company went public earlier this year. (In fact, nine years ago, in November 2012, Eric profiled the company for Inc.: “Airbnb Is Changing Travel.”)

Whenever we underwrite a new investment, we look for a few key attributes that help us determine the potential long-term value of a business, as well as its risks. In particular, we focus on management (Are they founders? Do they have skin the game? Are they playing the long game?), addressable market size (How big is the opportunity?), its relative growth and creativity to expand (Are they constantly innovating to make the product better for their customers?), margin expansion (Where can we find operating leverage in the model?), its status in the industry (Are they the dominant player? Can they
take market share from incumbents?), business risks (What are we missing? Are customers dissatisfied? What do employees say?) and probably a dozen more elements that are critical to our process. It’s only then do we take out the pencils do the valuation work.

In short, ABNB fulfills pretty much every element of a business model we’re attracted to: First, it’s highly scalable marketplace-based business model that unites buyer and seller with observable flywheel effects. (This is an important observation, in that the platform creates significant economic value for millions of hosts who rely on Airbnb, which in turn attracts new hosts who identify the opportunity, which creates more inventory, which turn attracts more travelers, which attracts more hosts, and soon.) Second, it has a global focus with significant opportunities to expand its operating leverage; Third,
its management—which is still founder-led—stands out to us as long-term thinkers capable of handling crisis, which the team demonstrated throughout the pandemic by dropping operating costs and turning the business into a more efficient, lean organization. (Like Churchill said: “Never let a good crisis go to waste.”)..”

8. Accenture Plc (NYSE:ACN)

Simons’ Stake Value: $127 million

Percentage of Jim Simons’ 13F Portfolio: 0.15%

Number of Hedge Fund Holders: 52

Accenture Plc (NYSE:ACN) is a multinational company that specializes in IT services and consulting, based in Dublin, Ireland. Ranked eighth on the list of the 10 stocks Jim Simons’ quant hedge fund is buying, Accenture Plc has a market capitalization of $222.93 billion.

According to the recent 13F Filings, Jim Simons’ Renaissance Technologies holds 430,900 shares of Accenture Plc, amounting to over $127 million in worth and representing 0.15% of the fund’s total portfolio value. At the end of the second quarter of 2021, 52 hedge funds in the database of Insider Monkey held stakes worth $3.15 billion in Accenture Plc, up from 48 hedge funds in the previous quarter with stakes worth $2.35 billion.

For the second quarter of 2021, Accenture Plc reported earnings per share at $2.03. beating estimates by $0.13. The company also generated revenues of $12.09 billion, surpassing the estimated revenues by $256.68 million.

On September 27, Barclays analyst Ramsey El-Assal raised the firm’s price target on Accenture Plc to $384 from $335 and kept an Overweight rating on the shares.

Just like Amazon.com, Inc., Alphabet Inc., Moderna, Inc., Microsoft Corporation and NVIDIA Corporation, Accenture Plc has a notable position in Jim Simons’ portfolio.

Fiduciary Management, in their Q1 2021 investor letter, mentioned Accenture plc (NYSE:ACN). Here is what the fund had to say:

“Even great companies can get too expensive. In early January, we sold our long-standing position in Accenture PLC after the company’s valuation exceeded 30 times next 12 months (NTM) earnings per share (EPS). We originally invested in Accenture at the launch of the FMI International strategy at a valuation below 15 times NTM EPS and held the stock for over ten years. We added to the holding numerous times in the early years, growing the position size to as high as 5.5% in late 2014, before dialing it back in recent years as the valuation became less compelling. It is one of the world’s largest information technology services firms, specializing in helping complex, global businesses navigate disruption, and focusing on next-generation services like digital, cloud, and security. For years, the investment allowed FMI to capture the inherently higher growth of technology-related industries (GDP+) without investing directly in pure “invention-oriented” technology companies. Through Accenture we were able to avoid some of the shortfalls of tech investing: technology obsolescence, short product cycles, and subpar return on invested capital (ROIC). It grew steadily, was solidly profitable, capital-light, and generated high returns, all while maintaining a rock-solid balance sheet. It compounded its business value for many years, outperforming the MSCI EAFE indices by over 450% during our holding period. Unfortunately, the market increasingly recognized the company’s positive attributes, and the stock’s discount to intrinsic value slowly evaporated. Despite our admiration for the business, it exceeded our valuation threshold. We will continue to follow the company closely for future opportunities.”

7. GameStop Corp. (NYSE:GME)

Simons’ Stake Value: $129.79 million

Percentage of Jim Simons’ 13F Portfolio: 0.16%

Number of Hedge Fund Holders: 18

GameStop Corp. (NYSE:GME) is a retail company that offers video game and consumer electronics products. Based in Texas, it is the largest video game retailer in the world. The company has a market capitalization of $14.49 billion and is ranked seventh on the list of the 10 stocks Jim Simons’ quant hedge fund is buying.

At present, Jim Simons’ Renaissance Technologies holds 606,141 shares of GameStop Corp., amounting to over $129.79 million in worth and representing 0.16% of the fund’s total portfolio value. At the end of the second quarter of 2021, 18 hedge funds in the database of Insider Monkey held stakes worth $247.9 million in GameStop Corp., up from 13 hedge funds in the previous quarter with stakes worth $96.4 million.

For the second quarter of 2021, GameStop Corp. reported earnings per share at -$0.40, missing market estimates by $0.26. The company also reported revenues of $942 million, falling short of the estimated revenues by $76.60 million.

On September 27, Ascendiant analyst Edward Woo lowered the firm’s price target on GameStop Corp. to $24 from $25 and kept a Sell rating on the shares, noting that the stocks popularity due to Reddit will soon fade.

Just like Amazon.com, Inc., Alphabet Inc., Moderna, Inc., Microsoft Corporation and NVIDIA Corporation, GameStop Corp. has a notable position in Jim Simons’ portfolio.

In the Q2 2021 investor letter of RF Capital Management, the fund mentioned GameStop Corp.. Here is what the fund said:

“Although the initial trading frenzy has passed, the stock price continues to remain elevated as we write this letter. We don’t profess to understand the mechanics and exact details of what drove GameStop’s historic run. However, we did trade around our position in GME as it happened and took full advantage of the price action. Because GME has been well-covered in the media, we’ll just provide a brief overview of what happened.

GameStop’s stock price started the year at $19/share. Then volume started to increase midJanuary, and the stock traded in the $30’s and $40’s. In the last week of January, the meteoric rise of GME’s stock price occurred. GME’s stock reached an all-time high of $483 before crashing back down to the $40’s. Essentially, the stock price rallied 2,442%, crashed (wiping out almost $30 billion in market cap), and rallied again.

The prevailing narrative was the battle between retail investors versus institutions and hedge funds. Retail investors were participating in forums and social media sites like WallStreetBets on Reddit and Twitter to exchange ideas. Then, they used brokers like Robinhood, TD Ameritrade, and WeBull to execute their trades. As a result, retail investors started getting involved with companies like GameStop, BlackBerry, and AMC Theatres.

Because there was heavy short interest in companies targeted by retail investors, hedge funds and institutions who were short these names started getting squeezed. Hedge funds like Melvin Capital were the first casualties of the short squeeze. Famous and prominent investors and executives such as Mark Cuban, Chamath Palihapitiya, and Elon Musk only added fuel to the fire by tweeting about and commenting on companies like GameStop.

With so much mainstream coverage of GameStop and other companies, Congress and the SEC started getting involved. Congress held hearings and investors like Keith Gill (Roaring Kitty on WallStreetBets) testified. The SEC also became more vigilant with the volatility and trading of certain stocks. For example, trading of GME was halted four times on Thursday in the last week of February, and the SEC suspended trading of fifteen companies the next day.

As of now, it is difficult to tell whether or not retail investors will continue to drive stock prices of select companies significantly in the future. However, this “phenomenon” will most likely be here to stay. Forums such as WallStreetBets have been around for as long as the internet. Unless such forums are regulated in a meaningful way, investors will continue to exchange ideas and analyze companies with one another. Furthermore, the stock market will continue to be more and more accessible to retail investors. Apps like Robinhood will continue to make it easy for individuals to trade stocks with low to zero commissions.

The public’s sentiment towards Wall Street, institutions, and our government is unlikely to change either. For many retail traders, participating in the stock market is a way to pass the time as well as a way to “get back” at institutions, hedge funds, and the government. While it is unclear if individuals are targeting hedge funds and companies with heavy short interest intentionally, retail investors will continue to make an impact on market fund flows as they become smarter and more educated about investing…” (Click here to see the full text)

6. Linde plc (NYSE:LIN)

Simons’ Stake Value: $145.7 million

Percentage of Jim Simons’ 13F Portfolio: 0.18%

Number of Hedge Fund Holders: 55

Linde plc (NYSE:LIN) is a multinational industrial gases and chemical company based in Dublin, Ireland. Linde plc (NYSE:LIN) is the global leader in the production, processing, and distribution of industrial gas. The company has a market capitalization of $159.68 billion, and is ranked sixth on the list of the 10 stocks Jim Simons’ quant hedge fund is buying.

According to the recent 13F Filings, Jim Simons’ Renaissance Technologies holds 504,100 shares of Linde plc (NYSE:LIN), amounting to over $145.7 million in worth and accounting for 0.18% of the fund’s total investment portfolio. At the end of the second quarter of 2021, 55 hedge funds in the database of Insider Monkey held stakes worth over $5.9 billion in Linde plc (NYSE:LIN), up from 43 hedge funds in the previous quarter with stakes worth $4.63 billion.

On July 30, Linde plc (NYSE:LIN) issued its quarterly earnings report for the second quarter of 2021, with earnings per share at $2.70, crossing estimates by $0.17. Additionally, the company generated revenues amounting to $7.58 billion, surpassing market predictions by $202.68 million.

On September 17, Societe Generale analyst Peter Clark raised the firm’s price target on Linde plc (NYSE:LIN) to $365 from $350 and kept a Buy rating on the shares.

Out of the hedge funds being tracked by Insider Monkey, London-based investment firm Ako Capital is a leading shareholder in Linde plc (NYSE:LIN) with over 4.18 million shares worth more than $1.2 billion.

5. Snowflake Inc. (NYSE:SNOW)

Simons’ Stake Value: $155.4 million

Percentage of Jim Simons’ 13F Portfolio: 0.19%

Number of Hedge Fund Holders: 70

Snowflake Inc. (NYSE:SNOW) is a cloud-based data storage and analytics services company based in Montana. Ranked fifth on the list of the 10 stocks Jim Simons’ quant hedge fund is buying, Snowflake Inc. has a market capitalization of $93.64 billion.

Jim Simons’ Renaissance Technologies currently holds 642,700 shares of Snowflake Inc., worth over $155.4 million and representing 0.19% of the fund’s portfolio value. At the end of the second quarter of 2021, 70 hedge funds in the database of Insider Monkey held stakes worth $12.5 billion in Snowflake Inc.. This is compared to 71 hedge funds in the preceding quarter with stake worth $12.96 billion.

On August 26, investment advisory Cowen maintained an Outperform rating on Snowflake Inc. stock and raised the price target to $335 from $310.

Out of the hedge funds being tracked by Insider Monkey, Altimeter Capital Management is a leading shareholder in Snowflake Inc. with 24.95 million shares worth more than $6.03 billion.

RiverPark Large Growth Fund, in their Q1 2021 investor letter, mentioned Snowflake Inc.. Here is what the fund said:

“We also established a position in Snowflake during the quarter. Snowflake offers cloud-based data storage and analytics, generally termed “data warehouse-as-a-service.” The data warehousing market—created by the massive, growing amount of user, customer, and account data and the need to search and analyze it—has historically stored its data on physical servers located on-premises. The cloud data platform market—storing data off-premises on cloud servers—is a relatively new $70 billion+ market. Significantly, incremental warehouse data capacity and renewals are expected to be driven by and to the cloud, with more than 75% of databases in the cloud by 2022.

Snowflake requires absolutely no infrastructure management from its users, is fully scalable for each customer, runs on Amazon, Microsoft, or Google cloud platforms, and most critically, Snowflake helps companies analyze their data. The company also has a unique, customer-aligned billing model based on usage. All of which has led to Snowflake being among the leaders of this highly fragmented market, posting 124% revenue growth last year. SNOW’s growth comes from the combination of more customers—which grew 73% last year—and customers buying more services—the company boasts an amazing 150%+ net customer retention. The company’s growing scale has also led to increasing gross margin and operating leverage, up 1,100 basis points and 8,200 basis points, respectively, over the past two years. The company has guided to FCF break-even this year, and with the company’s capital expenditure-light model—Snowflake uses the public cloud for hosting—we expect FCF to grow much faster than revenue growth, which we forecast to grow comfortably more than 50% per year for the next several years. Additionally, we have great confidence in the SNOW management team, which previously had an enormously successful run guiding one of our other core Cloud software holdings ServiceNow.”

4. UnitedHealth Group Incorporated (NYSE:UNH)

Simons’ Stake Value: $157.9 million

Percentage of Jim Simons’ 13F Portfolio: 0.19%

Number of Hedge Fund Holders: 105

UnitedHealth Group Incorporated (NYSE:UNH) is a healthcare company based in Minnesota that offers services ranging from health care services, pharmacy care services and health benefit plans. Ranked fourth on the list of the 10 stocks Jim Simons’ quant hedge fund is buying, UnitedHealth Group Incorporated has a market capitalization of $382.14 billion.

According to the recent 13F Filings, Jim Simons’ Renaissance Technologies holds 394,435 shares of UnitedHealth Group Incorporated, amounting to over $157.9 million in worth and accounting for 0.19% of the fund’s portfolio. At the end of the second quarter of 2021, 105 hedge funds in the database of Insider Monkey held stakes worth $13.1 billion in UnitedHealth Group Incorporated, up from 89 in the preceding quarter worth $12.1 billion.

On September 27, SVB Leerink analyst Whit Mayo initiated coverage of UnitedHealth Group Incorporated with an Outperform rating and $480 price target.

In its Q2 2021 investor letter, ClearBridge Investments mentioned UnitedHealth Group Incorporated and discussed its stance on the firm. Here is what the fund said:

“A good way to conceptualize how we think about portfolio construction is to picture a pyramid. At the bottom of the pyramid are the durable compounding growth companies that form the strong foundation, resilience, and consistency for the Strategy. We think these companies should comprise just under half of portfolio assets and feature annual revenue growth rates ranging from two times GDP up to 20% as well as healthy free cash flow generation.

UnitedHealth Group, a name we have owned in the Strategy since 1992, is a good example of a long-term compounder, having grown its revenue base from approximately $600 million to north of $260 billion over that time frame. It remains constantly focused on investing in new growth drivers such as telemedicine and health care analytics. Broadcom and Comcast have delivered similar long-term appreciation through a combination of organic growth, capital deployment into new and adjacent opportunities through merger and acquisition activity as well as returning capital to shareholders through buybacks and dividends.”

3. Micron Technology, Inc. (NASDAQ:MU)

Simons’ Stake Value: $171.9 million

Percentage of Jim Simons’ 13F Portfolio: 0.21%

Number of Hedge Fund Holders: 87

Micron Technology, Inc. (NASDAQ:MU) is a technology company based in Idaho that engages in the provision of innovative memory and storage solutions. Ranked third on the list of the 10 stocks in Jim Simons’ quant hedge fund is buying, Micron Technology, Inc. has a market capitalization of $84.63 billion.

At present, Jim Simons’ Renaissance Technologies holds 2.02 million shares of Micron Technology, Inc., worth $171.9 million and representing 0.21% of the fund’s portfolio. At the end of the second quarter of 2021, 87 hedge funds in the database of Insider Monkey held stakes worth $6.3 billion in Micron Technology, down from 100 in the preceding quarter worth $7.6 billion.

On September 27, Raymond James analyst Chris Caso lowered the firm’s price target on Micron Technology, Inc. to $100 from $120 and kept a Strong Buy rating on the shares.

In its Q1 2021 investor letter, Bonsai Partners, an asset management firm, highlighted a few stocks and Micron Technology was one of them. Here is what the fund said:

“Micron is a manufacturer of memory semiconductor chips. Micron appreciated 17.3% during the quarter.

With the semiconductor cycle in full swing, sentiment continued to improve for major DRAM and NAND suppliers. Spot pricing for DRAM continues its upward march due to supply shocks across the industry and sustained demand levels that continue to outstrip supply.

As a result, Micron showed improving results for the fiscal first quarter, raised guidance intra-quarter for the fiscal second quarter, and offered strong guidance for the fiscal third quarter in both growth and margins.

While the cyclical nature of DRAM hasn’t changed, the cycles themselves continue to become more benign, leading to long-term economic improvement across these businesses. Micron is now continuously profitable, with industry players in a dramatically stronger position than even just five years ago.

The biggest negative surprise in the quarter came from Micron’s exit from its 3D XPoint hybrid memory business. The company also announced its decision to sell its accompanying Utah fab. Fortunately, this development does not alter the investment thesis much since 3D XPoint was an option ticket for future growth. While it’s unfortunate this product didn’t pan out, now is an excellent time to sell a fab, so perhaps it is a blessing in disguise?”

2. Caterpillar Inc. (NYSE:CAT)

Simons’ Stake Value: $226.9 million

Percentage of Jim Simons’ 13F Portfolio: 0.28%

Number of Hedge Fund Holders: 62

Caterpillar Inc. (NYSE:CAT), is a manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives. Ranked second on our list of the 10 stocks Jim Simons’ quant hedge fund is buying, Caterpillar Inc. has a market capitalization of $109.49 billion.

Jim Simons’ Renaissance Technologies currently holds more than 1.04 million shares of Caterpillar Inc., amounting to over $226.9 million and accounting for 0.28% of the fund’s total investment portfolio. By the end of the second quarter of 2021, 62 hedge funds out of the 873 tracked by Insider Monkey held stakes in Caterpillar Inc. worth roughly $5.3 billion. This is compared to 53 hedge funds in the previous quarter with a total stake value of approximately $5 billion.

In the second quarter of 2021, Caterpillar Inc. had an earnings per share of $2.60, beating estimates by $0.19. The company’s revenue was $12.89 billion, up 28.93% on a year-over-year basis and beating estimates by $360.55 million.

In the Q2 2021 investor letter of Oakmark Funds, the fund mentioned Caterpillar Inc.. Here is what the fund said:

“Having followed the company closely for north of a decade, Caterpillar is a name we know well. For much of its history, the operating efficiency of the company left much to be desired, but its underlying competitive position was rarely in doubt. A series of actions over the past decade (e.g., LEAN implementation, improved service mix, optimized manufacturing footprint) helped to narrow the gap between Caterpillar’s potential and its realized results, driving material margin expansion and strong share price performance. In our view, the company remains among the highest quality industrials in the market, but its underlying business is cyclical, which can translate to large swings in both performance and investor sentiment over short time periods. Our ability to focus on the long-term, sustainable earnings power of a business (rather than getting distracted by near-term fluctuations) is our most significant edge when investing in cyclical businesses. Due to the inherent volatility in Caterpillar’s end markets and operating performance, we suspect we’ll have a future opportunity to own this high-quality business at a more attractive price once the cycle turns and today’s enthusiasm wears off.”

1. NIO Inc. (NYSE:NIO)

Simons’ Stake Value: $281.6 million

Percentage of Jim Simons’ 13F Portfolio: 0.35%

Number of Hedge Fund Holders: 34

NIO Inc. (NYSE:NIO) is a multinational automobiles manufacturer based in Shanghai. The company specializes in the development of electric vehicles. NIO Inc. has a market capitalization of $60.25 billion, and is ranked first on the list of the 10 stocks Jim Simons’ quant hedge fund is buying.

According to the recent 13F Filings, Jim Simons’ Renaissance Technologies holds 5.29 million shares of NIO Inc., amounting to over $281.6 million in worth and representing 0.35% of the fund’s total portfolio value. By the end of the second quarter of 2021, 34 hedge funds out of the 873 tracked by Insider Monkey held stakes in NIO Inc. worth roughly $2.06 billion. This is compared to 28 hedge funds in the previous quarter with a total stake value of approximately $1.32 billion.

On August 11, NIO Inc. issued its earnings report for the second quarter of 2021, with reported earnings per share at -$0.06, surpassing market estimates by $0.05. In addition to this, the company generated revenues of $1.30 billion, beating estimated revenues by $12.26 million.

On September 26, HSBC analyst Yuqian Ding lowered the firm’s price target on Nio to $47 from $69 and kept a Buy rating on the shares.

You can also take a peek at Unknown Billionaire Phill Gross’ Top 10 Stock Picks and Top 10 High Growth Stocks To Buy in 2021.

Follow Insider Monkey on Twitter