In this piece, we will take a look at the top 5 stock picks of Jonathan Esfandi’s JNE Partners. If you want a primer on the hedge fund investor and his firm, then head on over to the Top 10 Stock Picks of Jonathan Esfandi’s JNE Partners.
5. MSD Acquisition Corp. (NASDAQ:MSDA)
JNE Partners’ Stake Value: $15 million
Percentage of JNE Partners’ 13F Portfolio: 8.46%
Number of Hedge Fund Holders: N/A
MSD Acquisition Corp. (NASDAQ:MSDA) is a special purpose acquisition company created by Gregg Lemkau and John Phelan in February 2021. As opposed to some other SPACs that generally have a specific industry or company in mind as a target, MSD Acquisition Corp. (NASDAQ:MSDA) plans to target ‘high-growth’ sectors such as the technology industry.
Mr. Esfandi’s investment firm owned 1.5 million MSD Acquisition Corp. (NASDAQ:MSDA) shares worth $15 million and comprised 8.46% of its portfolio during Q3 2021. The company’s IPO in March last year saw it raise $575 million in proceeds.
4. Alibaba Group Holding Limited (NYSE:BABA)
JNE Partners’ Stake Value: $16.6 million
Percentage of JNE Partners’ 13F Portfolio: 9.4%
Number of Hedge Fund Holders: 116
Alibaba Group Holding Limited (NYSE:BABA) is a Chinese electronic commerce giant that has also propelled its founder, Mr. Jack Ma, to fame globally. The Chinese company has also diversified its presence to target high growth areas including machine learning and cloud computing.
Mr. Esfandi’s hedge fund held 112,700 Alibaba Group Holding Limited (NYSE:BABA) shares as Q3 2021 ended. This enabled it to hold a $16.6 million stake that made up 9.4% of its portfolio. During the same time period, 115 out of 867 hedge funds surveyed by Insider Monkey held a stake in the company.
Alibaba Group Holding Limited (NYSE:BABA)’s largest investor is Ken Fisher’s Fisher Asset Management who owns 14 million shares worth $2 billion according to Insider Monkey’s research.
Artisan Partners mentioned Alibaba Group Holding Limited (NYSE:BABA) in its Q3 2021 investor letter, stating that:
“We also find Alibaba’s valuation compelling despite the prospect of increased regulation. The share price declined 35% during the quarter. Alibaba is China’s largest e-commerce business and is one of the highest return businesses in the world. The company’s core ecommerce operation dominates China’s retail industry. That business continues growing at a low-teens rate and operates with an incredible 62% profit margin. The company also operates several promising new businesses which have been a drag on the bottom line, though the company overall remains highly profitable and cash flow generative. The market cap today is about $440 billion. The company has large investments in cloud, financial services and other businesses worth an estimated $100 billion, leaving the core operations valued at $340 billion. Core operations over the last 12 months generated about $27 billion of after-tax profits, resulting in a trailing P/E of 12.5X. Alibaba certainly faces increased competition and a marginal increase in regulation. As a result, we expect modest growth in earnings over the next few years. However, a company with Alibaba’s operating and financial strength should trade at a premium, rather than a significantly discounted valuation.”
3. Canadian National Railway Company (NYSE:CNI)
JNE Partners’ Stake Value: $19.9 million
Percentage of JNE Partners’ 13F Portfolio: 11.23%
Number of Hedge Fund Holders: 38
Canadian National Railway Company (NYSE:CNI) is, as the name suggests, a railway company based in Montreal, Canada. It provides freight forwarding, transportation, and logistics services to customers in the United States and Canada.
As the third quarter of last year came to an end, JNE Partners owned 306,300 Canadian National Railway Company (NYSE:CNI) shares which were worth $19.9 million and represented 11.23% of its portfolio. During the same time period, out of 867 hedge funds polled by Insider Monkey, 38 had owned the company’s shares.
Canadian National Railway Company (NYSE:CNI) largest shareholder is Chris Hohn’s TCI Fund Management who owns 55.8 million shares for a whopping $3.6 billion stake.
2. Comcast Corporation (NASDAQ:CMCSA)
JNE Partners’ Stake Value: $31.4 million
Percentage of JNE Partners’ 13F Portfolio: 17.72%
Number of Hedge Fund Holders: 78
Comcast Corporation (NASDAQ:CMCSA) is global media and technology company that provides and operates cable entertainment, internet, security and automation, wireless phone services, and television channels. It is headquartered in Philadelphia, Pennsylvania, United States.
Mr. Esfandi’s JNE Partners held 561,902 Comcast Corporation (NASDAQ:CMCSA) shares during Q3 2021, which were worth $31.4 million and represented 17.72% of its portfolio. During the same time period, 78 hedge funds out of the 867 part of Insider Monkey’s research owned the company’s shares.
Jean-Marie Eveillard’s First Eagle Investment Management is Comcast Corporation (NASDAQ:CMCSA)’s largest investor via owning 29 million shares that are worth $1.6 billion.
ClearBridge Investments mentioned Comcast Corporation (NASDAQ:CMCSA) in its Q2 2021 investor letter. It outlined that:
“We funded the shift primarily with trims in Comcast following big gains in this name. Comcast is a long-term holding that has been and remains a core holding. During the quarter, however, we took gains and resized the positions to reflect their current risk-reward post strong increases in the stocks.
Comcast, like Blackstone, has been a meaningful long-term holding whose stock performance has at times lagged its robust fundamental performance. Over the last nine months the stock price caught up some with the fundamentals and looked like it had more room to run. Our thesis on the name evolved, however, following the May 17 announcement that competitor Discovery was merging its operations with Time Warner. This deal positions the new company as a credible competitor to Netflix, Amazon Prime, Hulu and Disney, and results in Comcast being left without the proverbial dance partner in the evolving pay TV/DTC landscape. While we continue to believe Comcast’s cable systems business is well-positioned and that NBCUniversal remains valuable, the competitive dynamic for NBCUniversal has stiffened. Our reduced position size reflects both our continued enthusiasm for many parts of the franchise and emerging concerns given the evolving pay TV/DTC landscape.”
1. AMERCO (NASDAQ:UHAL)
JNE Partners’ Stake Value: $32.8 million
Percentage of JNE Partners’ 13F Portfolio: 18.5%
Number of Hedge Fund Holders: 25
AMERCO (NASDAQ:UHAL) is a storage and logistics provider that serves corporate and non-corporate customers in the United States and Canada. The company also operates an online marketplace that allows movers to connect with customers.
JNE Partners owned 50,826 AMERCO (NASDAQ:UHAL) shares at the end of the third quarter of last year. These were worth $32.8 million and represented 18.5% of its portfolio. A Q3 2021 Insider Monkey survey of 867 hedge funds revealed that 25 owned a stake in the company.
Disclosure: None. You can also take a peek at the 10 Best EV Startups to Watch and 10 Notable Earnings Reports to Watch.
