In this piece, we will take a look at the top 10 stock picks of Jonathan Esfandi’s JNE Partners. If you want to skip over our introduction of Mr. Esfandi, his investment firm, and the bottom five stocks in this list, then head on over to the Top 5 Stock Picks of Jonathan Esfandi’s JNE Partners.
JNE Partners is a British hedge fund based out of London, United Kingdom. It is run by Mr. Jonathan Esfandi who has been at the helm of its affairs for two years. When compared to some of his other peers in the financial world, Mr. Esfandi keeps a relatively low profile, and little is known about him except for his time at his current and former firms. The executive has decades of experience in the financial world and prior to becoming the managing partner at JNE Partners, he was a partner at the firm MSD Partners.
MSD Partners was directly responsible for managing the assets of American consumer electronics billionaire Mr. Michael Dell and his family. JNE Partners is a spin-off of MSD Partners, and Mr. Esfandi has occupied the top position at the firm since it was formed in 2019. While it became independent during the previous decade, JNE Partners had previously operated as a subsidiary of MSD Partners, after it was formed in 2009. The executive joined his former firm in 2006 in order to create its office in London. Prior to joining, he had worked at the American private equity firm Lone Star Funds, at which his role required him to work with the debt of troubled European firms. He started the journey at Lone Star in 2003 and would go on to become a Vice President in the three years that he spent at the company. Debt research is his specialty since before joining Lone Star, Mr. Esfandi was a distressed debt researcher at the London-based credit specialist Guy Butler. He graduated from Manchester University with a Bachelor’s degree in European Studies and Modern Languages in 1998.
When compared to the multi-billion dollar hedge funds out there, JNE Partners has a relatively modest portfolio. This was valued at $177 million as the third quarter of last year came to an end, which marked for a 30% growth in value over the previous quarter and 55% growth over Q3 2020. The firm invests in only a handful of firms, which are spread across special purpose acquisition companies (SPACs), industrials, and technology. Its largest investments are in AMERCO (NASDAQ:UHAL), Comcast Corporation (NASDAQ:CMCSA), and Canadian Pacific Railway Limited (NYSE:CP).
Photo by Austin Distel on Unsplash
Our Methodology:
In order to sift out Mr. Esfandi’s favorite stocks, we took a look at JNE Partners’ 13F filings with the Securities and Exchange Commission (SEC) for the third quarter of last year. This enabled us to pick the top companies in the firm’s portfolio, after which we analyzed the top firms by studying their earnings reports, analyst coverage, large investors, investor letters, and overall hedge fund sentiment of 867 funds that are part of Insider Monkey’s Q3 2021 survey.
Top 10 stock picks of Jonathan Esfandi’s JNE Partners
10. Starz Acquisition LLC (NASDAQ:STRZA)
JNE Partners’ Stake Value: $5.3 million
Percentage of JNE Partners’ 13F Portfolio: 3%
Number of Hedge Fund Holders: N/A
Starz Acquisition LLC (NASDAQ:STZA) is a media firm that was acquired by the entertainment giant Lions Gate Entertainment Corp. (NYSE:LGF-A) in 2016, following which the company became a Lions Gate subsidiary. Prior to its acquisition, the company was owned by Liberty Media, who spun it off into a separate public company in 2011. Starz Acquisition LLC (NASDAQ:STZA)’s relationship with Lions Gate started in 2015 when its majority shareholder took a stake in the latter by swapping shares.
Mr. Esfandi’s investment firm had a stake of $5 million in Starz Acquisition LLC (NASDAQ:STZA) as Q3 2021 ended. This was through owning 202,000 shares and it represented 3% of its investment portfolio.
Just like Comcast Corporation (NASDAQ:CMCSA), AMERCO (NASDAQ:UHAL), and Canadian Pacific Railway Limited (NYSE:CP), Starz Acquisition LLC (NASDAQ:STZA) is in the list of Mr. Esfandi and his investment firm’s top stock picks for the third quarter of last year.
9. Waldencast Acquisition Corp. (NASDAQ:WALD)
JNE Partners’ Stake Value: $9.8 million
Percentage of JNE Partners’ 13F Portfolio: 5.52%
Number of Hedge Fund Holders: N/A
Waldencast Acquisition Corp. (NASDAQ:WALD) is s special purpose acquisition company (SPAC) that aims to acquire business operating in the cosmetics and beauty industry. The company intends to create a global beauty and wellness brand by leveraging the innovative opportunities offered by smaller companies in the industry. Waldencast Acquisition Corp. (NASDAQ:WALD) raised more than $1.2 billion in capital this year, and its investor presentation from November 2021 reveals that only its projections for revenue and earnings before interest, taxes, and depreciation (EBITDA) compound annual growth rates (CAGR) were above estimates for its peers. The company announced a $1.2 billion business combination with two beauty brands in November 2021.
JNE Partners’ stake in Waldencast Acquisition Corp. (NASDAQ:WALD) was worth $9.8 million as the third quarter of last year came to an end. This was through owning 1 million shares and it represented 5.52% of the investment firm’s portfolio.
Waldencast Acquisition Corp. (NASDAQ:WALD)’s largest investor after Mr. Esfandi’s firm is Paul Marshall and Ian Wace’s Marshall Wace LLP who owns 971,043 shares worth $9.5 million.
8. Elliott Opportunity II Corp. (NYSE:EOCW)
JNE Partners’ Stake Value: $11 million
Percentage of JNE Partners’ 13F Portfolio: 6.27%
Number of Hedge Fund Holders: N/A
Elliott Opportunity II Corp. (NYSE:EOCW) is another special purpose acquisition company (SPAC). It announced details of its initial public offering (IPO) in June last year, following which the blank check firm managed to raise $609 million in gross proceeds. Elliott Opportunity II Corp. (NYSE:EOCW) intends to combine with a services firm in the technology industry, with a large total addressable market (TAM), strong industry position, and suitable management.
Mr. Esfandi’s JNE Partners owned 1.1 million Elliott Opportunity II Corp. (NYSE:EOCW) shares that were worth $11 million and represented 6.27% of its portfolio in Q3 2021. Japanese investor Masayoshi Son’s SB Management is Elliott Opportunity II Corp. (NYSE:EOCW)’s biggest investor. It has a $48 million stake through owning 4.9 million shares.
7. NovaGold Resources Inc. (NYSE:NG)
JNE Partners’ Stake Value: $13.4 million
Percentage of JNE Partners’ 13F Portfolio: 7.58%
Number of Hedge Fund Holders: 16
NovaGold Resources Inc. (NYSE:NG) is a Canadian gold mining company that operates in the United States. Its primary ownership interests come in the form of a 50% stake in the Donlin Gold mining project in Alaska that covers an eye-popping area of 71,420 acres.
Mr. Esfandi’s hedge fund owned 1.9 million NovaGold Resources Inc. (NYSE:NG) shares during the third quarter of last year. These were worth $13.4 million and represented 7.58% of its portfolio. During the same time period, 16 of the 867 hedge funds part of Insider Monkey’s survey had also bought the mining company’s shares.
6. Orion Biotech Opportunities Corp. (NASDAQ:ORIA)
JNE Partners’ Stake Value: $14.8 million
Percentage of JNE Partners’ 13F Portfolio: 8.37%
Number of Hedge Fund Holders: N/A
Orion Biotech Opportunities Corp. (NASDAQ:ORIA) is a special purpose acquisition company (SPAC) that aims to target and acquire a biotechnology company. The biotechnology sector has been pushed to the forefront of the global spotlight in the wake of the ongoing pandemic which saw an unprecedented push towards vaccine development and research.
JNE Partners owned 1.5 million Orion Biotech Opportunities Corp. (NASDAQ:ORIA) shares worth $14.8 million and 8.37% of its portfolio during Q3 2021. The SPAC’s shares began trading on the NASDAQ exchange in May 2021 after Orion Biotech Opportunities Corp. (NASDAQ:ORIA)’s initial public offering (IPO) closed and netted the company $200 million in gross proceeds. The hedge fund’s stake dropped in Q3 slightly, since it stood at $15 million in the previous quarter.
Canadian Pacific Railway Limited (NYSE:CP), Comcast Corporation (NASDAQ:CMCSA), and AMERCO (NASDAQ:UHAL) are met by the biotechnology SPAC Orion Biotech Opportunities Corp. (NASDAQ:ORIA) in the top favorite stock picks of Jonathan Esfandi and JNE Partners.
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Disclosure: None. Top 10 stock picks of Jonathan Esfandi’s JNE Partners is originally published on Insider Monkey.
