Mr. Pink Dan Loeb’s 5 Long-Term Stock Picks

In this article, we discuss Dan Loeb’s 5 long-term stock picks. If you want to read our detailed analysis of Dan Loeb’s investment strategy and latest activist targets, check out Mr. Pink Dan Loeb’s Long-Term Stock Picks. 

5. DuPont de Nemours, Inc. (NYSE:DD)

Number of Hedge Fund Holders: 52

Third Point’s Stake Value: $287,080,000

Third Point’s Holding Period: 2 years 3 months

DuPont de Nemours, Inc. (NYSE:DD) offers technology-led materials and solutions worldwide, with its operations divided into three segments – Electronics & Industrial, Water & Protection, and Corporate & Other. DuPont de Nemours, Inc. (NYSE:DD) has been part of Mr. Pink’s portfolio for 2 years and 3 months. As per securities filings for the first quarter of 2023, Loeb raised his stake in DuPont de Nemours, Inc. (NYSE:DD) by 34%, holding 4 million shares worth $287 million. 

On June 27, DuPont de Nemours, Inc. (NYSE:DD) declared a $0.36 per share quarterly dividend, in line with previous. The dividend is payable on September 15, to shareholders of record on July 31. 

According to Insider Monkey’s first quarter database, 52 hedge funds were bullish on DuPont de Nemours, Inc. (NYSE:DD), compared to 48 funds in the prior quarter. 40 North Management is the largest position holder in the company. 

Third Point made the following comment about DuPont de Nemours, Inc. (NYSE:DD) in its Q4 2022 investor letter:

“We recently increased our investment in DuPont de Nemours, Inc. (NYSE:DD), a specialty chemical company run by legendary value creator Ed Breen, who is leading a corporate transformation. In November, DuPont divested its most cyclical and lowest margin business segment, Mobility & Materials, to Celanese for $11 billion, or 14x 2023e EV/EBITDA. Following the divestiture, the improved DuPont trades at 11x 2023e EV/EBITDA, which represents a ~30% discount to its peer group.

We believe the company is laser-focused on closing this gap. First, $5 billion of the proceeds are being deployed to repurchase nearly 15% of its outstanding shares. The next significant catalyst for the stock is a potential settlement of PFAS-related multidistrict litigation in South Carolina, which remains an overhang on the stock even though DuPont’s PFAS liability was largely ring-fenced by the 2021 settlement with Chemours and Corteva. DuPont’s strong management team is eager to demonstrate the business quality of the new portfolio during the current period of economic volatility. We expect the combined catalysts of increased share repurchases, the pending resolution of legal claims, and the new business structure to drive meaningful value for shareholders.”

4. UnitedHealth Group Incorporated (NYSE:UNH)

Number of Hedge Fund Holders: 116

Third Point’s Stake Value: $158,317,650

Third Point’s Holding Period: 2 years 6 months

UnitedHealth Group Incorporated (NYSE:UNH), an American healthcare services provider, has been part of Dan Loeb’s portfolio for two and a half years. In Q1 2023, Loeb had 335,000 shares of UnitedHealth Group Incorporated (NYSE:UNH) worth $158.3 million, representing 2.59% of the total 13F holdings. However, the billionaire slashed his stake by 50% in Q1. 

On July 14, UnitedHealth Group Incorporated (NYSE:UNH) reported a Q2 non-GAAP EPS of $6.14 and a revenue of $92.9 billion, outperforming Wall Street estimates by $0.16 and $1.94 billion, respectively. 

According to Insider Monkey’s first quarter database, 116 hedge funds were bullish on UnitedHealth Group Incorporated (NYSE:UNH), compared to 110 funds in the prior quarter. Rajiv Jain’s GQG Partners is the leading stakeholder of the company, with approximately 4 million shares worth $2.10 billion. 

ClearBridge Large Cap Value Strategy made the following comment about UnitedHealth Group Incorporated (NYSE:UNH) in its first quarter 2023 investor letter:

“The tech-dominated quarter was a headwind for both defensive and cyclical sectors, with shares of health care holdings such as UnitedHealth Group Incorporated (NYSE:UNH), Elevance (ELV) and Johnson & Johnson (JNJ) declining after a strong 2022.”

3. Global Blue Group Holding AG (NYSE:GB)

Number of Hedge Fund Holders: 9

Third Point’s Stake Value: $51,225,606

Third Point’s Holding Period: 2 years 9 months

Global Blue Group Holding AG (NYSE:GB) offers transaction processing services for entities such as merchants, banks, acquirers, governments, and travelers worldwide. The company operates through three segments – Tax Free Shopping Technology Solutions, Added-Value Payment Solutions, and Retail Tech Solutions. In Q1 2023, Dan Loeb held 8.5 million shares of Global Blue Group Holding AG (NYSE:GB) worth $51.2 million. The stock has been part of Mr. Pink’s portfolio for 2 years and 9 months. 

On June 28, Global Blue Group Holding AG (NYSE:GB) reported a Q4 net loss of €1 million and a revenue of €86.8 million, up 121.4% on a year-over-year basis. 

According to Insider Monkey’s first quarter database, 9 hedge funds were bullish on Global Blue Group Holding AG (NYSE:GB), with collective stakes worth $932.2 million. Silver Lake Partners is the leading position holder in the company, with 134.6 million shares worth $807.7 million. 

2. PG&E Corporation (NYSE:PCG)

Number of Hedge Fund Holders: 52

Third Point’s Stake Value: $958,072,500

Third Point’s Holding Period: 2 years 9 months 

PG&E Corporation (NYSE:PCG) is involved in the distribution and supply of electricity and natural gas across the United States. The company generates electricity through nuclear power, hydroelectric power, fossil fuel-fired power plants, fuel cells, and photovoltaic systems. In Q1 2023, PG&E Corporation (NYSE:PCG) was the largest stock in Dan Loeb’s portfolio, with the billionaire holding 59.25 million shares worth $958 million. It is one of his top long-term stock picks. 

On May 4, PG&E Corporation (NYSE:PCG) reported a Q1 non-GAAP EPS of $0.29, in-line with market consensus. The revenue increased 7.3% year-over-year to $6.21 billion, outperforming Wall Street estimates by $20 million. 

According to Insider Monkey’s first quarter database, 52 hedge funds were bullish on PG&E Corporation (NYSE:PCG), with combined stakes worth approximately $3 billion. Stuart J. Zimmer’s Zimmer Partners is a prominent stakeholder of the company, with 17.85 million shares worth $288.7 million. 

Third Point Management made the following comment about PG&E Corporation (NYSE:PCG) in its Q1 2023 investor letter:

“Our strategy is to preserve liquidity and buying power to take advantage of markets when they “break”. While overall indices remain elevated, we are finding more chances to provide liquidity across all three asset classes in which we invest – credit, structured credit, and equity – opportunities which have been key drivers of performance for the fund. Our portfolio is balanced across industries with a focus on event-driven names including companies involved in spin-offs, significant cost-cutting, or other types of under-appreciated business transformation. PG&E Corporation (NYSE:PCG), which is still our largest position, continues to deliver strong performance, down 50bps in the first quarter but up 6.2% for the year to date after the Fire Victims Trust sold another 60 million shares in a block trade.”

1. Danaher Corporation (NYSE:DHR)

Number of Hedge Fund Holders: 90

Third Point’s Stake Value: $693,110,000

Third Point’s Holding Period: 7 years 6 months

Danaher Corporation (NYSE:DHR) specializes in the design, manufacturing, and marketing of a wide range of professional, medical, industrial, and commercial products and services. Danaher Corporation (NYSE:DHR) is the longest-held stock in Dan Loeb’s portfolio. In the first quarter of 2023, the billionaire owned 2.75 million shares of Danaher Corporation (NYSE:DHR) worth over $693 million. 

On May 9, Danaher Corporation (NYSE:DHR) declared a $0.27 per share quarterly dividend, in line with previous. The dividend is payable on July 28, to shareholders of record on June 30. 

According to Insider Monkey’s first quarter database, 90 hedge funds were bullish on Danaher Corporation (NYSE:DHR), compared to 88 funds in the earlier quarter. Charles Akre’s Akre Capital Management is a prominent stakeholder of the company, with a position worth 1.78 million shares worth $450.6 million. 

Oakmark Global Fund made the following comment about Danaher Corporation (NYSE:DHR) in its second quarter 2023 investor letter:

“Danaher Corporation (NYSE:DHR) is a global leader in life sciences that maintains a portfolio of businesses primarily focused on bioprocessing, life science tools, genomics and diagnostics. In our view, Danaher has an excellent track record of creating shareholder value through smart capital allocation and world-class operational execution. The firm’s Danaher Business System employs a rigorous, process-driven approach to operational improvement that’s helped accelerate organic growth and expand margins through multiple leadership regimes. Danaher’s business mix has shifted dramatically in recent years after a series of transformative acquisitions and divestitures. We believe these portfolio moves leave the company attractively positioned in some of the industry’s fastest growing, most profitable niches. The upgraded portfolio contains premiere assets levered to secular growth areas, like biologics, molecular diagnostics, and genomics, that support many years of high-single-digit revenue growth and margin expansion. Near-term headwinds related to the pandemic are overshadowing this attractive long-term outlook. Danaher sells diagnostic tests and critical inputs needed for manufacturing Covid-19 vaccines. Robust demand for these products during the pandemic boosted the stock price in 2020 and 2021. As Covid-19 demand normalized, Danaher experienced sales headwinds and channel destocking on these products, which pressured the stock. We believe these near-term headwinds will ultimately prove short- lived. Danaher now trades at a discounted valuation relative to peers and private market transactions, which provided an attractive entry point to invest in this high-quality, resilient business.”

Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily enewsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below. You can also check out Lone Pine Capital: Portfolio, Team, AUM and Larry Robbins’ Net Worth, Performance and Portfolio.