In this article, we discuss the top 5 stock picks of Michael Hintze. If you want to see more of the billionaire’s top holdings, check out Michael Hintze’s 2022 Portfolio: Top 10 Stock Picks.
5. Liberty Broadband Corporation (NASDAQ:LBRDA)
CQS Cayman’s Stake Value: $19,322,000
Percentage of CQS Cayman’s 13F Portfolio: 1.33%
Number of Hedge Fund Holders: 26
Liberty Broadband Corporation (NASDAQ:LBRDA) is a Colorado-based communications company, offering wireless, data, voice, and subscription-based video services. In the March quarter, Michael Hintze’s CQS Cayman boosted its Liberty Broadband Corporation (NASDAQ:LBRDA) stake by 18%, holding 142,783 shares worth $19.3 million, representing 1.33% of its 13F portfolio.
On May 10, Deutsche Bank analyst Bryan Kraft maintained a ‘Buy’ recommendation on Liberty Broadband Corporation (NASDAQ:LBRDA) but lowered the price target on the stock to $158 from $196 after the Q1 results.
Among the hedge funds tracked by Insider Monkey, 26 funds were long Liberty Broadband Corporation (NASDAQ:LBRDA) at the end of March 2022, up from 22 funds in the prior quarter. Boykin Curry’s Eagle Capital Management is the largest shareholder of the company, with 8.3 million shares worth $1.13 billion.
Here is what Longleaf Partners Fund has to say about Liberty Broadband Corporation (NASDAQ:LBRDA) in its Q1 2022 investor letter:
“Liberty Broadband – A new position in 4Q 2021, holding company Liberty Broadband also suffered from a widening of a market-imposed holdco discount in an uncertain quarter. Liberty’s stakes in Charter and Alaskan cable company GCI also faced near-term concerns over slowing industry broadband additions, but these businesses have over a decade of pricing power history and are well positioned to weather an inflationary environment. We have a high degree of respect for our partners John Malone and Greg Maffei, who are focused on growing value per share and are actively repurchasing discounted shares to help close the price-to-value gap.”
4. Activision Blizzard, Inc. (NASDAQ:ATVI)
CQS Cayman’s Stake Value: $21,140,000
Percentage of CQS Cayman’s 13F Portfolio: 1.46%
Number of Hedge Fund Holders: 80
Activision Blizzard, Inc. (NASDAQ:ATVI) is a California-based interactive entertainment and video game company. In its first quarter regulatory filings, Michael Hintze’s hedge fund reported owning 263,888 shares of Activision Blizzard, Inc. (NASDAQ:ATVI), worth $21.14 million, representing 1.46% of its total portfolio value. Activision Blizzard, Inc. (NASDAQ:ATVI) was a new addition to Hintze’s hedge fund in Q1 2022.
On April 25, Activision Blizzard, Inc. (NASDAQ:ATVI) announced “disappointing” fiscal Q1 financial results, Benchmark analyst Mike Hickey told investors in a research note. The analyst was not surprised by Call of Duty’s weakness, as the last product release was underwhelming, but said the decline in Blizzard’s growth “was somewhat shocking”. However, the Microsoft acquisition has built a “valuation floor” for Activision Blizzard, Inc. (NASDAQ:ATVI) investors, added the analyst. He kept a ‘Buy’ rating on the stock with a $100 price target.
According to Insider Monkey’s data, 80 hedge funds were long Activision Blizzard, Inc. (NASDAQ:ATVI) at the end of Q1 2022, up from 70 funds in the previous quarter. Warren Buffett’s Berkshire Hathaway is the largest stakeholder in the company, with 64.3 million shares worth $5.15 billion. Buffett’s hedge fund boosted its stake in Activision Blizzard, Inc. (NASDAQ:ATVI) by 339% in Q1.
Here is what the FPA U.S. Core Equity Fund had to say about Activision Blizzard, Inc. (NASDAQ:ATVI) in its Q1 2022 investor letter:
“One of the Fund’s biggest winners in the first quarter was Activision Blizzard. On January 18, 2022 Microsoft (NASDAQ:MSFT) agreed to purchase ATVI for $95.00 per share in an all-cash transaction. The Fund has been invested in ATVI since the second quarter of 2018.
The investment thesis was threefold. First, the greater than $200 billion gaming industry is the largest and fastest growing form of entertainment in the world. More than three billion people play games currently and the population of global gamers is expected to grow faster than global population growth this decade.14 Second, ATVI has some of the best intellectual property in the gaming industry including Warcraft, Diablo, Overwatch, Call of Duty and Candy Crush in addition to global eSports activities through Major League Gaming. Third, ATVI has had a pristine balance sheet with net cash over the past four years, generated robust free cash flow and traded at an undemanding valuation.
ATVI closed the quarter at $80.11—a nearly 16% discount to the acquisition price. Assuming it takes about a year for the deal to close, a 18.6% return seems to be a good upside relative to the risk of a deal not closing due to anti -trust concerns. If the transaction closes it would make Microsoft the third-largest company in gaming by revenue behind Tencent and Sony. There is plenty of competition from these larger players as well as smaller competitors such as EA, Take-Two Interactive, Roblox and Epic Games’ Fortnite. The Fund remains invested in ATVI given the significant discount, but should the discount narrow in the coming quarters the Fund could reduce or eliminate the position.”
3. Ambac Financial Group, Inc. (NYSE:AMBC)
CQS Cayman’s Stake Value: $21,320,000
Percentage of CQS Cayman’s 13F Portfolio: 1.47%
Number of Hedge Fund Holders: 20
Ambac Financial Group, Inc. (NYSE:AMBC) is a New York-based financial services holding company that specializes in financial guarantee insurance policies, specialty property and casualty program insurance, credit derivative contracts, and interest rate derivative transactions. Michael Hintze owned 2 million Ambac Financial Group, Inc. (NYSE:AMBC) shares in Q1 2022, worth $21.3 million, representing 1.47% of his fund’s total 13F portfolio.
Among the hedge funds tracked by Insider Monkey, 20 funds reported owning stakes in Ambac Financial Group, Inc. (NYSE:AMBC) as of the end of Q1 2022, up from 16 funds in the earlier quarter. Deepak Sarpangal’s Repertoire Partners is a prominent stakeholder of the company, with more than 1 million shares worth about $10.5 million.
Here is what Gator Capital Management had to say about Ambac Financial Group, Inc. (NYSE:AMBC) in its Q4 2021 investor letter:
“Although higher interest rates will benefit the Fund’s portfolio, we are making sure that the Fund is not simply a bet on higher rates. We have several large holdings with inexpensive valuations and catalysts unrelated to higher interest rates. Ambac (AMBC) has its lawsuit against Countrywide/Bank of America scheduled for September, 2022 which we expect will result in a large cash infusion to the company.”
2. Liberty Global plc (NASDAQ:LBTYA)
CQS Cayman’s Stake Value: $50,543,000
Percentage of CQS Cayman’s 13F Portfolio: 3.49%
Number of Hedge Fund Holders: 28
Liberty Global plc (NASDAQ:LBTYA) is a London-based broadband internet, video, fixed-line telephony, and mobile communications company. In the first quarter of 2022, Michael Hintze’s CQS Cayman owned about 2 million shares of Liberty Global plc (NASDAQ:LBTYA), worth $50.5 million, representing 3.49% of its total 13F holdings. The hedge fund boosted its position in the company by 32% in Q1 2022.
On July 14, Deutsche Bank analyst Robert Grindle maintained a ‘Buy’ rating on Liberty Global plc (NASDAQ:LBTYA) but lowered the price target on the stock to $32 from $38 ahead of the company’s Q2 results. As per the analyst, it is difficult to predict what will immediately reverse the stock’s downward trend apart from a sustained market rally, but if the company seeks out a privatization deal, it would not be surprising.
Among the hedge funds tracked by Insider Monkey, Seth Klarman’s Baupost Group featured as the biggest stakeholder of Liberty Global plc (NASDAQ:LBTYA) as of Q1 2022, with roughly 54 million shares worth $1.39 billion. Overall, 28 hedge funds were bullish on the stock at the end of Q1 2022.
1. Fox Corporation (NASDAQ:FOX)
CQS Cayman’s Stake Value: $80,031,000
Percentage of CQS Cayman’s 13F Portfolio: 5.53%
Number of Hedge Fund Holders: 38
Fox Corporation (NASDAQ:FOX) is a New York-based news, sports, and entertainment company. The company operates through three segments – Cable Network Programming, Television, and Other, Corporate and Eliminations. Michael Hintze’s CQS Cayman owned 2.20 million shares of Fox Corporation (NASDAQ:FOX) in Q1 2022, worth $80 million, representing 5.53% of the total value of its 13F holdings.
On June 2, Wolfe Research analyst Peter Supino downgraded Fox Corporation (NASDAQ:FOX) to ‘Peer Perform’ from ‘Outperform’ with a price target of $39, down from $52. The analyst told investors that FY23 catalysts are already “baked-into consensus estimates” and while sports and news drive the pay-TV bundle, they “too are leaky buckets”.
Among the hedge funds tracked by Insider Monkey, Donald Yacktman’s Yacktman Asset Management was the largest shareholder of Fox Corporation (NASDAQ:FOX) in Q1 2022, with 8.5 million shares worth $310.2 million. Overall, 38 hedge funds were bullish on the stock at the conclusion of March 2022, up from 31 funds in the prior quarter.
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