Marc Lasry’s Avenue Capital Portfolio: Top Stock Picks

In this article, we discuss the top stock picks of Marc Lasry’s Avenue Capital. If you want to skip our detailed analysis of Lasry’s investment strategy, history, and stock picks, go directly to Marc Lasry’s Avenue Capital Portfolio: Top 2 Stock Picks

Moroccan-born Marc Lasry is an American billionaire businessman and a champion in the world of distressed investment on Wall Street. He is the co-founder of Avenue Capital, a New York-based hedge fund he founded in 1995 along with his sister Sonia Gardner. The fund started with $100 million in seed money and went on to become a multi-billion dollar hedge fund, holding $13 billion in assets under management (AUM) as of May 2011. Marc Lasry has a Bachelor’s in History degree from Clark University and J.D. from New York Law School which he earned in 1984. Before founding Avenue Capital, Lasry co-founded Amroc Investments, LLC, whilst he was also managing capital for Amroc Investments, L.P., the predecessor firm associated with Robert M. Bass Group, Inc.

The reason for Marc Lasry’s success is his keen eye for companies that are in financial difficulty, and his ability to overhaul them to give excellent returns. His firm focuses on buying distressed and undervalued debt and equity, and currently holds $161 million in assets under management (AUM). In 2013, Marc Lasry was listed as one of the 25 highest-earning hedge fund managers, boasting $280 million in annual earnings.

Worth approximately $1.8 billion, Lasry is a stock genius who doesn’t shy away from the spotlight. A lifelong basketball fan, he is the co-owner of NBA team Milwaukee Bucks, bought together with Jamie Dinan and Wes Edens for $550 million in 2014. Decaying at the bottom of the standings at the time of the takeover, the team has gone through a transformation to become 2021 NBA champions, and is now worth $1.9 billion, according to Forbes.

Lasry is a vocal supporter of the Democratic Party, having donated frequently to Hillary Clinton’s campaigns. He also serves on the Council on Foreign Relations and was once in the consideration to become the Obama administration’s ambassador to France, a proposition he rejected in order to focus on his business ventures.

Along with his wife Cathy, he has donated $5 million to his alma mater Clark University for the construction of the “Cathy ’83 and Marc ’81 Lasry Center for Bioscience”. Lasry has contributed to the TV show Billions, which is about the inside world of hedge funds and the psyche of billionaires.

The show’s monologue, delivered by lead character Axelrod, a hedge fund manager, was provided by Marc Lasry:

There’s a small group who can do the math. There’s an even smaller group who can explain it. But those few who can do both? They become billionaires.

Marc Lasry can certainly do both. His hedge fund Avenue Capital Management held positions in 6 stocks in its 13F portfolio as of the end of September, valued at $161 million. His holdings were spread out across the energy and utility sector, and his portfolio jumped 0.75% over the last quarter.

Marc Lasry’s Latest Portfolio Moves

Avenue Capital Management completely exited positions in three stocks over the quarter. The first was Chesapeake Energy Corporation (NASDAQ:CHK), a US-based company that deals in the exploration and development of oil, natural gas, and natural gas liquid products from underground reservoirs. Last quarter, Lasry owned 911,646 shares in the company worth $47.32 million. The firm posted revenue of $1.17 billion for the third quarter, beating expectations by $360.83 million.

Another stock sold over the last quarter was Chromcraft Revington Inc (NYSE:CRC), a furniture company that operates in the United States. By the end of the second quarter, Marc Lasry owned 90,358 shares in Chromcraft Revington Inc (NYSE:CRC), valued at $2.72 million.

Marc Lasry also sold all of his 193,002 shares in SM Energy Company (NYSE:SM). The value of these shares stood at $4.75 million. The Texas-based energy company posted an EPS of $0.74 for the third quarter, beating consensus estimates by $0.60. On November 2, research firm RBC Capital kept its ‘Sector Perform’ rating on SM Energy Company (NYSE:SM) stock, raising the price target to $44 from $36.

According to 13F filings for the third quarter, Marc Lasry’s Avenue Capital’s top stock picks include Vistra Corp. (NYSE:VST), Transocean Ltd. (NYSE:RIG), and Gulfport Energy Corporation (NYSE:GPOR).

Marc Lasry’s Avenue Capital Portfolio: Top Stock Picks

Here is a list of the top stock picks of Marc Lasry’s Avenue Capital. The analysis of Marc’s 13F portfolio for the third quarter was used for this article. The hedge fund sentiment was gauged using Insider Monkey’s database of 867 elite hedge funds.

Marc Lasry’s Avenue Capital Portfolio: Top Stock Picks

6. Impel NeuroPharma, Inc. (NASDAQ:IMPL)  

Avenue Capital’s Stake Value: $4.01 million

Percentage of Avenue Capital’s 13F Portfolio: 2.48% 

Number of Hedge Fund Holders: 6

Starting off this list is Impel NeuroPharma, Inc. (NASDAQ:IMPL), a company that deals in the development of medical devices. The Seattle-based company offers treatments and therapies for central nervous system diseases. In the last six-month period, Impel NeuroPharma, Inc. (NASDAQ:IMPL) lost 8% of its stock value, and as of December 4, shares of the company traded at $8.82 on the NASDAQ stock exchange.

According to the regulatory filings for the third quarter, Marc Lasry’s Avenue Capital reported owning 330,000 shares in the biotech company, valued at $4.01 million. This represents 2.48% of the fund’s overall portfolio.

As of the third quarter of 2021, 6 hedge funds out of 867 tracked by Insider Monkey reported owning shares in Impel NeuroPharma, Inc. (NASDAQ:IMPL). The combined value of these shares stood at $45.96 million. In the last quarter, the same number of hedge funds reported owning $30.02 million worth of shares in the company.

For the third quarter, NeuroPharma, Inc. (NASDAQ:IMPL) reported an EPS (GAAP) of -$1.24, which missed consensus estimates by $0.49. The biotech firm raked in $91,000 in revenue for the quarter, which was in-line with analysts’ forecasts.

Along with Vistra Corp. (NYSE:VST), Transocean Ltd. (NYSE:RIG), and Gulfport Energy Corporation (NYSE:GPOR), NeuroPharma, Inc. (NASDAQ:IMPL) is one of the top stock picks of Marc Lasry’s Avenue Capital.

5. Transocean Ltd. (NYSE:RIG)

Avenue Capital’s Stake Value: $5.03 million

Percentage of Avenue Capital’s 13F Portfolio: 3.11% 

Number of Hedge Fund Holders: 27

According to the regulatory filings for the third quarter of 2021, Marc Lasry’s hedge fund Avenue Capital owns 1,328,986 shares in Transocean Ltd. (NYSE:RIG), at a combined value of $5.03 million which represents 3.11% of the fund’s total holdings. Lasry decreased his holding in the company by 39% over the last quarter, where he held 2.16 million shares valued at $9.76 million.

Transocean Ltd. (NYSE:RIG) is a Swiss company that deals in offshore drilling services for oil and natural gas reserves around the globe. The company posted an EPS of -$0.19 for the third quarter, which missed consensus estimates by $0.04. The firm gained 38% in stock value over the last year.

As of the third quarter, 27 hedge funds tracked by Insider Monkey reported owning positions in Transocean Ltd. (NYSE:RIG). The total value of these positions stood at $263.28 million. This shows that hedge fund sentiment is steady on the company, as the same number of hedge funds reported owning shares in the company last quarter, with a combined value of $313.05 million.

4. Frontier Communications Parent, Inc. (NASDAQ:FYBR)

Avenue Capital’s Stake Value: $10.65 million

Percentage of Avenue Capital’s 13F Portfolio: 6.58% 

Number of Hedge Fund Holders: 43

Frontier Communications Parent, Inc. (NASDAQ:FYBR) is a provider of communication services to residential and commercial customers in 25 states across the United States. The company was incorporated in April 2021, and was formerly known as Frontier Communications Corporation. The company provides a range of services including data and internet, video, and network solutions.

Avenue Capital owns 382,453 shares in the company, as of the third quarter, worth $10.65 million. This shows an increase of 170% over the last quarter, where Avenue Capital held $3.75 million worth of shares in the firm.

On November 3, Frontier Communications Parent, Inc. (NASDAQ:FYBR) reported its earnings for the third quarter. The firm reported earnings per share of $0.58, beating estimates by $0.07. Quarterly revenue stood at $1.58 billion, falling below analysts’ forecasts by $10.65 million.

On November 5, MoffettNathanson analyst Nick Del Deo kept a ‘Buy’ rating on the company stock, raising the price target to $36 from $34. In October, Frontier Communications Parent, Inc. (NASDAQ:FYBR) struck a network deal with AT&T, in a bid to bring fiber-optic connectivity to customers outside AT&T’s current footprint, as well as to support the deployment of AT&T’s 5G mobile network.