In this article, we discuss top 5 stock picks of John Hurley’s Cavalry Asset Management. If you want to read our detailed analysis of Hurley’s investment philosophy and portfolio construction, go directly to the Top 10 Stock Picks of John Hurley’s Cavalry Asset Management.
5. Tesla, Inc. (NASDAQ:TSLA)
Cavalry Asset Management’s Stake Value: $55,775,000
Percentage of Cavalry Asset Management’s 13F Portfolio: 5.2%
Number of Hedge Fund Holders: 72
Tesla, Inc. (NASDAQ:TSLA) manufactures electric automobiles. It also provides services relating to these products. On October 24, Morgan Stanley analyst Adam Jonas retained an ‘Overweight’ rating on Tesla, Inc. (NASDAQ:TSLA) stock while trimming his price objective from $350 to $330. According to Jonas, Tesla’s third-quarter report, although in line with consensus expectations, was better and of higher quality than predicted.
Cavalry Asset Management made its first investment in Tesla, Inc. (NASDAQ:TSLA), during the first quarter of 2017, purchasing shares worth about $12.09 million. In Q2 2022, the hedge fund bought an additional 30,833 Tesla, Inc. (NASDAQ:TSLA) shares, increasing its position in the company by 60%. As a result, the fund’s TSLA stake amounted to over $55.78 million in Q2, representing 5.2% of Cavalry Asset Management’s portfolio.
As per Insider Monkey’s Q2 data, the number of hedge funds holding stakes in Tesla, Inc. (NASDAQ:TSLA) decreased to 72 by the end of Q2, down from 80 at the end of Q1. The total stake value of those 72 funds was roughly $7.17 billion. In the third quarter of 2022, Catherine D. Wood’s ARK Investment Management, with shares worth nearly $1.08 billion, is a prominent Tesla, Inc. (NASDAQ:TSLA) investor among those funds.
In its Q2 2022 investor letter, Carillon Tower Advisers mentioned Tesla, Inc. (NASDAQ:TSLA). Here is what the firm had to say:
“Tesla, Inc. (NASDAQ:TSLA), the electric vehicle and clean energy company, is set to recall more than 100,000 cars in China over a potential safety risk and is reportedly delaying a plan to restore production at its Shanghai plant. CEO Elon Musk was reported to have said that the company would cut 10% of salaried staff and freeze hiring due to a bad feeling he has about the economy.”
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4. Monolithic Power Systems, Inc. (NASDAQ:MPWR)
Cavalry Asset Management’s Stake Value: $61,216,000
Percentage of Cavalry Asset Management’s 13F Portfolio: 5.71%
Number of Hedge Fund Holders: 36
Monolithic Power Systems, Inc. (NASDAQ:MPWR) develops, produces, and sells semiconductor-based power electronics solutions for the computer and storage, automotive, industrial, communications, and consumer industries. Whale Rock Capital Management holds the most prominent stake in Monolithic Power Systems, Inc. (NASDAQ:MPWR), with 729,061 shares worth $279.99 million.
On October 28, Raymond James analyst Melissa Fairbanks maintained an ‘Outperform’ rating on Monolithic Power Systems, Inc. (NASDAQ:MPWR) while trimming her price objective from $570 to $400. Even though new auto sector engagements helped Q3 earnings above estimates, Fairbanks cautioned investors in a research note that the collapse of the consumer and computing industries is drastically lowering near-term prospects.
Insider Monkey hedge fund database reveals that in the first quarter of 2022, 29 hedge funds were bullish on Monolithic Power Systems, Inc. (NASDAQ:MPWR). However, in the second quarter of 2022, the number increased to 36 hedge funds.
According to the 13F filings for the second quarter of 2022, Cavalry Asset Management held 159,401 shares of Monolithic Power Systems, Inc. (NASDAQ:MPWR), amounting to $61.22 million. Monolithic Power Systems, Inc. (NASDAQ:MPWR) was the fourth-largest holding of the hedge fund and represented 5.71% of its 13F portfolio in the second quarter of 2022.
In its Q2 2022 investor letter, Artisan Partners mentioned Monolithic Power Systems, Inc. (NASDAQ:MPWR). Here is what the fund said:
“Monolithic Power Systems, Inc. (NASDAQ:MPWR) designs analog power-management chips for a wide variety of industrial and consumer devices. The paths of the company’s profit cycle and share price have diverged this year. Investors have rotated out of high-growth stocks with elevated multiples, raised concerns about the company potentially facing headwinds from China COVID-19 lockdowns and a potential recession. Meanwhile, the company’s recent quarterly results and outlook helped dispel some of these fears. Monolithic reported 48% revenue growth and issued guidance for the following quarter well ahead of expectations. There are COVID-related impacts in China, but we are monitoring them closely, and we believe the company can continue to navigate them over modest durations. Based on its unique ability to offer highly integrated solutions and solve complex power management issues across multiple end-applications, we believe the company is well-positioned to continue to drive its ongoing profit cycle in the periods ahead.”
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3. Datadog, Inc. (NASDAQ:DDOG)
Cavalry Asset Management’s Stake Value: $67,036,000
Percentage of Cavalry Asset Management’s 13F Portfolio: 6.25%
Number of Hedge Fund Holders: 81
Datadog, Inc. (NASDAQ:DDOG) provides a cloud-based monitoring and analytics platform for programmers, IT operations teams, and business users. Additionally, 81 hedge funds tracked by Insider Monkey reported owning stakes in Datadog, Inc. (NASDAQ:DDOG) as of the second quarter, down from 82 in the previous quarter. The total value of the stakes was over $2.71 billion.
As part of a more significant research note outlining Infrastructure Software Q3 data, Truist analyst Joel Fishbein retained a ‘Buy’ rating on the shares of Datadog, Inc. (NASDAQ:DDOG) and cut his price objective from $155 to $120 on October 26. According to the analyst, despite recent price compression, the importance of enterprise software for companies across all industries has continued to grow.
Cavalry Asset Management started building its position in Datadog, Inc. (NASDAQ:DDOG) during the third quarter of 2019. In Q2 2022, the hedge fund elevated its position in the company by 453%, maintaining a stake worth $67.04 million. Datadog, Inc. (NASDAQ:DDOG) accounted for 6.25% of the hedge fund’s portfolio.
Here is what Baron Funds, an asset management firm, has to say about Datadog, Inc. (NASDAQ:DDOG) in its Q1 2022 investor letter:
“Another example is Datadog, the leading infrastructure monitoring, application performance monitoring and log management software platform. Datadog’s stock declined 15% during the quarter, despite reporting sparkling operational results, with revenues accelerating to a growth rate of 84% year-over-year with 33% free cash flow margins, while guiding for 2022 significantly above expectations. Datadog added 4,600 new customers in the quarter, while existing customers continued to increase their spending on Datadog products at a rapid pace with the number of customers using four or more products increasing to 33% from 22% last year. While Datadog’s stock was down, its intrinsic value has undoubtedly increased. This is enabled by rapid innovation (Datadog released 13 new products in 2021) into a market that is benefiting from the secular growth in cloud, digital transformation, and the explosion in complexity as the number of vendors, diversity of technologies and related infrastructure continued to expand.”
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2. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Cavalry Asset Management’s Stake Value: $79,927,000
Percentage of Cavalry Asset Management’s 13F Portfolio: 7.46%
Number of Hedge Fund Holders: 87
Advanced Micro Devices, Inc. (NASDAQ:AMD) is a multinational semiconductor company. ZWEIG DIMENNA PARTNERS was a notable stakeholder of the company in Q3, holding shares worth roughly $3.71 million.
Gus Richard, a Northland analyst, downgraded Advanced Micro Devices, Inc. (NASDAQ:AMD) from ‘Outperform’ to ‘Market Perform’ on October 31 with a $60 price objective, down from $80. Richard forewarned investors that he expected domestic Chinese demand to recover exceptionally slowly and that ARM CPU market share would continue to expand, especially in China.
Cavalry Asset Management reported owning shares worth $79.93 million of Advanced Micro Devices, Inc. (NASDAQ:AMD) at the end of Q2 2022, slashing the position by 13% from the last quarter. By the end of Q2 2022, 87 hedge funds tracked by Insider Monkey held stakes in Advanced Micro Devices, Inc. (NASDAQ:AMD), up from 83 in the previous quarter. The aggregate value of these stakes was over $4.84 billion.
In its Q2 2022 investor letter, Baron Funds mentioned Advanced Micro Devices, Inc. (NASDAQ:AMD). Here is what the fund said:
“Advanced Micro Devices, Inc. (NASDAQ:AMD) is a global fabless semiconductor company focusing on high-performance computing technology, software, and products. AMD designs leading high-performance central and graphics processing units (known as CPUs and GPUs) and integrates them with hardware and software to build differentiated solutions for customers.….” (Click here to read the full text)
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1. Palo Alto Networks, Inc. (NASDAQ:PANW)
Cavalry Asset Management’s Stake Value: $82,745,000
Percentage of Cavalry Asset Management’s 13F Portfolio: 7.72%
Number of Hedge Fund Holders: 90
Palo Alto Networks, Inc. (NASDAQ:PANW) supplies cybersecurity solutions globally. On October 21, Cantor Fitzgerald analyst Jonathan Ruykhaver initiated coverage of Palo Alto Networks, Inc. (NASDAQ:PANW), assigning the stock an ‘Overweight’ rating and a $220 price target.
Joe Dimenna’s ZWEIG DIMENNA PARTNERS is a remarkable stakeholder of Palo Alto Networks, Inc. (NASDAQ:PANW) in the third quarter of 2022, with 52,835 shares worth $8.65 million. In the second quarter, Cavalry Asset Management elevated its stake in Palo Alto Networks, Inc. (NASDAQ:PANW) by 4%, and its position is now worth about $82.75 million.
Palo Alto Networks, Inc. (NASDAQ:PANW) was in 90 hedge fund portfolios at the end of the second quarter of 2022. There were 87 hedge funds in our database with PANW at the end of the previous quarter.
ClearBridge Investments mentioned Palo Alto Networks, Inc. (NASDAQ:PANW) in its Q1 2022 investor letter. Here is what the fund said:
The portfolio also saw solid performance from cybersecurity names Palo Alto Networks, Inc. (NASDAQ:PANW) which is gaining prominence as the risk of global cyber attacks increases as part of the Russian offensive. On an individual stock basis, leading contributors to absolute returns in the first quarter included positions in Palo Alto Networks.
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You can also take a peek at Top 10 Stock Picks of Eli Casdin’s Casdin Capital and Top 10 Stock Picks of William Von Mueffling’s Cantillon Capital Management
