In this article, we discuss Ricky Sandler’s top 5 stock picks. For Sandler’s investment philosophy and his comments on certain stocks please see Ricky Sandler’s Top 10 Stock Picks.
5. Ashland Global Holdings Inc. (NYSE: ASH)
Value: $319,586,000
Percent of Ricky Sandler’s 13F Portfolio: 2.99%
No. of Hedge Fund Holders: 38
Yet another chemicals company in Ricky Sandler’s portfolio, Ashland Global operates various segments including solvents, personal & home care, food, pharmaceuticals and industrials. The stock is up about 90% over the last 12 months. The company in February announced preliminary results for the quarter ended December 31, 2020. EPS in the quarter came in at $0.99, crushing past the Street estimates of $0.57. Revenue in the quarter jumped 3.6% to $552 million, beating the consensus by $11.82 million.
As of the end of the fourth quarter, 38 hedge funds in Insider Monkey’s database of 887 funds held stakes in ASH, compared to 46 funds in the third quarter. Ricky Sandler’s Eminence Capital is the biggest stakeholder in the company, with 4.04 million shares, worth $319.6 million.
4. Nuance Communications, Inc. (NASDAQ: NUAN)
Value: $321,344,000
Percent of Ricky Sandler’s 13F Portfolio: 3.01%
No. of Hedge Fund Holders: 60
Massachusetts-based Nuance ranks 4th in the list of Ricky Sandler’s top 10 stock picks and portfolio as of the end of the fourth quarter. The company makes software for healthcare, speech recognition, AI and customer support. The stock recently jumped after Wedbush analyst Daniel Ives added Nuance to his best ideas list. The analyst has an Outperform rating for the stock, with a price target of $65.
The company is also getting the attention of the smart money, as 60 hedge funds tracked by Insider Monkey reported owning stakes in the company at the end of the fourth quarter, up from 45 funds a quarter earlier.
Artisan Mid Cap Fund, in their Q4 2020 investor letter, mentioned Nuance Communications, Inc. (NASDAQ: NUAN). Here is what Artisan Mid Cap Fund has to say about Nuance Communications, Inc. in their Q4 2020 investor letter:
“We started new investment campaigns in Nuance Communications in Q4. Nuance Communications is a leader in automated voice transcription technologies. The company’s relatively new management team has spent the past couple of years divesting sub-par businesses, paying down high yield debt and refocusing the company on higher growth, cloud-based recurring revenue opportunities primarily in health care, but also in large enterprises. The company has recently launched Dragon Ambient Experience (DAX), a tool physicians can use to automatically document patient encounters efficiently, accurately and consistently in telehealth and in-office settings. Health care practitioners can spend over 20% of their time documenting, and DAX can virtually eliminate this duty so more time can be dedicated to patient care. DAX is very early in its launch and could be a very meaningful profit cycle driver over time.”
3. Macquarie Infrastructure Corporation (NYSE: MIC)
Value: $322,977,000
Percent of Ricky Sandler’s 13F Portfolio: 3.02%
No. of Hedge Fund Holders: 31
Macquarie Infrastructure Corp invests in infrastructure businesses. The company has two main segments: Atlantic Aviation and MIC Hawaii. Atlantic provides fuel, terminal, aircraft hangaring and other services primarily to owners and operators of general aviation (GA) jet aircraft at over 70 airports in the U.S., while MIC Hawaii processes and distributes gas and provides related services. The stock has gained 34% over the last 12 months. In February, the company announced a tender offer to purchase any and all of its 2.00% convertible senior notes due 2023.
As of the end of the fourth quarter of 2020, Eminence Capital owns 8.6 million shares of MIC worth $322.98 million. MIC accounts for 3.02% of Eminence Capital’s total portfolio.
2. New Relic, Inc. (NYSE: NEWR)
Value: $362,265,000
Percent of Ricky Sandler’s 13F Portfolio: 3.39%
No. of Hedge Fund Holders: 30
Ricky Sandler’s Eminence Capital is bullish on New Relic, which makes monitoring software and various other SaaS and Cloud applications. The hedge fund owns 5.54 million shares of the company, worth $362.27 million. The stock is up 33% over the last 12 months. In February, UBS downgraded the stock and cut its price target from $89 to $76, saying that the company’s revenue growth recovery is still two to three quarters away.
According to our database, the number of NEWR’s long hedge funds positions decreased at the end of the fourth quarter of 2020. There were 30 hedge funds that hold a position in New Relic compared to 31 funds in the third quarter. The biggest stakeholder of the company is Ricky Sandler’s Eminence Capital, with 5.5 million shares, worth $362.3 million.
1. Berry Global Group, Inc. (NYSE: BERY)
Value: $367,468,000
Percent of Ricky Sandler’s 13F Portfolio: 3.44%
No. of Hedge Fund Holders: 34
Fortune 500 company Berry Global Group Inc. tops the list of Ricky Sandler’s top 10 stock picks. The company markets plastic packaging products and operates in various segments including health, hygiene, consumer packaging and engineered materials. The company recently priced the private placement of $775 million of additional 1.57% First Priority Senior Secured Notes due January 15, 2026.
With a $367.5 million stake in BERY, Eminence Capital owns 6.5 million shares of the company as of the end of the fourth quarter of 2020. Our database shows that 34 hedge funds held stakes in Berry Global Group as of the end of the fourth quarter, versus 43 funds in the third quarter.
You can also take a peek at Billionaire Izzy Englander’s Top 10 Stock Picks and 10 Best Tech Stocks To Buy Now According To Billionaire Laffont.
