In this article, we will be looking at the 5 stocks John Clark’s Southpoint is currently selling. If you want to see our comprehensive analysis of Clark’s history, investment philosophy and hedge fund performance, go directly to John Clark’s Southpoint Capital is Selling Caterpillar and 9 Other Stocks.
John Clark’s fund sold its entire stakes in the following companies in the third quarter.
5. Clearway Energy, Inc. (NYSE:CWEN)
Total Number of Hedge Fund Holders: 17
Number 5 on the list of stocks sold by John Clark’s Southpoint Capital is Clearway Energy, Inc. (NYSE: CWEN), a company that deals in renewable energy generation facilities in the United States. For the third quarter of 2021, the company posted an EPS of $0.18, missing consensus estimates by -$0.80. Revenue for the quarter stood at $351.00 million, falling below expectations by $88.19 million.
On November 5, Oppenheimer analyst Noah Kaye upgraded the company stock from ‘Perform’ to ‘Outperform’, setting a $44 price target. The analyst noted that Clearway’s “material strategic progress” supports its objectives for dividend growth and long-term portfolio targets.
4. Dolby Laboratories, Inc. (NYSE:DLB)
Total Number of Hedge Fund Holders: 33
Dolby Laboratories, Inc. (NYSE: DLB) deals in the production of audio and imaging equipment for the cinema, TV and broadcast industries.
The company posted an EPS of $0.58 for the third quarter, which beat consensus estimates by $0.02. Revenue for the quarter was $285.02 million, which fell below analysts’ forecasts by $14.93 million.
Out of 867 elite hedge funds tracked by Insider Monkey, 33 hedge funds held positions worth $521.15 million in Dolby Laboratories, Inc. (NYSE: DLB), as reported by the end of September. In the previous quarter, 31 hedge funds held positions worth $748.48 million in the company.
3. Nuance Communications, Inc. (NASDAQ:NUAN)
Total Number of Hedge Fund Holders: 61
Next up is Nuance Communications, Inc. (NASDAQ: NUAN), a Massachusetts-based company that provides conversational and cognitive artificial intelligence (AI) innovations, to enhance machine responsiveness to human speech.
As of the third quarter of 2021, 61 hedge funds disclosed ownership of stakes in Nuance Communications, Inc. (NASDAQ: NUAN). The combined value of these stakes was $4.86 billion.
Investment management firm Rhizome Partners recently published its Q3 investor letter. Here’s what the fund said about Nuance Communications, Inc. (NASDAQ: NUAN).
“We also exited our small position in Nuance upon Microsoft’s acquisition. Nuance is a leader in voice recognition software, with dominant market share, and its speech-to-text product is the gold standard in radiology. In addition, by eliminating the need for note taking and allowing doctors to focus on patient care, Nuance could transform the way doctors treat patients. We built a 1% position in Nuance after attending its comprehensive investor day. Our view is that if Nuance can successfully grow its voice-recognition software in doctor’s offices, it could be worth multiples of our cost basis. Microsoft’s acquisition eliminated the multi-bagger upside but also partially validates the belief that Nuance is a high-quality technology company. We exited Nuance with a 62% gain in less than a year. This example is representative of the slight adjustments we made to our portfolio construction. We will allocate to small bets on technology and high-growth companies that could increase our exposure to “right tail” upside. Rest assured that our focus is still roughly 50% real estate, 30% high-quality companies trading at cheap multiples of free cash flow, and the rest in investments with the potential for growth and higher upside.”
2. Paysafe Limited (NYSE:PSFE)
Total Number of Hedge Fund Holders: 42
London-based Paysafe Limited (NYSE: PSFE) is up next on the list of stocks John Clark is selling. The company provides online payment solutions and operates through its segments: Integrated Processing, Digital Wallet and eCash Solutions.
On November 12, research firm RBC Capital reiterated its ‘Outperform’ rating on the company stock, lowering the price target from $15 to $9. The firm’s analyst Daniel Perlin noted that Q3 results were disappointing as the company’s Digital Wallet segment came under pressure from open banking and direct to bank apps in Europe. The analyst remained positive on a number of unique features offered by the company, but believes the management has much to do to regain investor confidence.
1. SolarWinds Corporation (NYSE:SWI)
Total Number of Hedge Fund Holders: 15
SolarWinds Corporation (NYSE: SWI) is an information-technology company based in the United States. The firm offers products such as network performance monitors, server and application monitors and network configuration managers. The firm lost 38.07% of its stock value in the last year, and 5.22% in the year to date.
In the third quarter of 2021, 15 hedge funds reported owning shares in SolarWinds Corporation (NYSE: SWI). The combined value of these holdings stood at $1.09 billion.
SolarWinds Corporation (NYSE: SWI) raked in revenue of $181.27 million for Q3, exceeding expectations by $2.70 million. The company posted earnings per share of $0.37, beating estimates by $0.10.
On October 29, RBC Capital analyst Matthew Hedberg downgraded the company stock from ‘Outperform’ to ‘Sector Perform’, and set the price target at $19, down from $28. The analyst noted that Q3 results were ‘okay’, and cited a lack of catalysts as his reason for lowering the rating.
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