In this article, we discuss the top 10 stock picks of Yale University. If you want to skip our detailed analysis of these stocks, go directly to Yale University Stock Portfolio: Top 5 Picks.
Yale University is one of the richest academic institutions across the world, boasting an endowment value of more than $42 billion at the end of June 2021, up from $31 billion at the end of the second quarter of 2020. The Endowment contains hundreds of different funds that serve a variety of purposes for the university. According to the university, three-quarters of these provide funding for donor-defined purposes. The remaining is used by the Yale Corporation to invest in the stock market.
For the fiscal year that ended on June 30, the university reported a 40% investment return, totaling $12 billion in gains. Matt Mendelsohn, the chief investment officer of Yale, said that although the returns were extraordinary, the investments made by the university represented long-term commitments that aimed to provide stable support to the institution. The investments of the university are made public at the end of each quarter through regulatory filings.
The university made 11 new purchases between March and June this year, sold out of 4 stocks, and made additional purchases in 3. It did not reduce holding in any stock through this period. Some of the top stocks in the portfolio of Yale University include Microsoft Corporation (NASDAQ:MSFT), DocuSign, Inc. (NASDAQ:DOCU), and Lyft, Inc. (NASDAQ:LYFT), among others discussed in detail below. Investors who are eager to replicate the success of the university at the stock market should comb over their portfolio in detail to pick winners.
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Our Methodology
Here is our list of the top 10 stock picks of Yale University. These were picked from the investment portfolio of the university at the end of the second quarter of 2021. We compiled the list of stocks by analyzing the data of over 873 hedge funds tracked by Insider Monkey.
Why pay attention to hedge fund holdings? Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 86 percentage points since March 2017. Between March 2017 and July 2021 our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY. Our stock picks outperformed the market by more than 86 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
Yale University Stock Portfolio: Top Picks
10. Douglas Emmett, Inc. (NYSE:DEI)
Number of Hedge Fund Holders: 19
Last month, investment advisory Piper Sandler raised the price target on Douglas Emmett, Inc. (NYSE:DEI) stock to $42 from $40, reiterating an Overweight rating and underlining that tenant demand in shopping centers, a core holding of the firm, remained unabashed. In addition to shopping centers, Douglas Emmett also invests in office spaces along the Los Angeles coastline. This has provided the firm with a solid foundation. On September 10, it declared a quarterly dividend of $0.28 per share, in line with previous. The forward yield was 3.45%.
According to the latest filings, Yale University owned 10,500 shares in Douglas Emmett, Inc. (NYSE:DEI) worth over $353,000 at the end of the second quarter of 2021, representing 0.13% of the portfolio.
At the end of the second quarter of 2021, 19 hedge funds in the database of Insider Monkey held stakes worth $360 million in Douglas Emmett, Inc. (NYSE:DEI), up from 14 in the preceding quarter worth $337 million.
9. Upstart Holdings, Inc. (NASDAQ:UPST)
Number of Hedge Fund Holders: 21
Upstart Holdings, Inc. (NASDAQ:UPST) recently announced that it would be partnering with Abound Credit Union in Kentucky to improve digital lending for the youth and adults. As part of the new partnership, artificial intelligence systems will be deployed for the loan process. Prominent finance personality Jim Cramer has also recently touted the power of neo banks in the digital economy, backing firms like Upstart to climb higher in the coming weeks and months as more businesses go digital.
According to the latest data, Yale University owned 5,250 shares in Upstart Holdings, Inc. (NASDAQ:UPST) at the end of June 2021 worth more than $655,000, representing 0.23% of the portfolio.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Third Point is a leading shareholder in Upstart Holdings, Inc. (NASDAQ:UPST) with 13.3 million shares worth more than $1.6 billion.
In addition to Microsoft Corporation (NASDAQ:MSFT), DocuSign, Inc. (NASDAQ:DOCU), and Lyft, Inc. (NASDAQ:LYFT), Upstart Holdings, Inc. (NASDAQ:UPST) is one of the stocks that institutional investors are buying.
In its Q2 2021 investor letter, Vulcan Value Partners, an asset management firm, highlighted a few stocks and Upstart Holdings, Inc. (NASDAQ:UPST) was one of them. Here is what the fund said:
“During the quarter, we purchased Upstart Holdings Inc. Upstart is an artificial intelligence (AI) and cloud-based lending platform. The company uses AI models to underwrite superior loans with lower interest rates, lower default rates, higher approval rates, and increased underwriting automation. Consumers can access Upstart-powered loans through its banking partners’ websites; however, most of its loans are underwritten on Upstart.com. Upstart has a fee-based revenue model and retains only a small portion of the loans, while the majority of the loans end up on the balance sheets of its partner banks or are sold into the capital markets. We believe Upstart’s technology is superior to the FICO score, which is ubiquitous within the consumer credit markets. With an excellent product and a large total addressable market, we believe that Upstart’s prospects are bright.”
8. RAPT Therapeutics, Inc. (NASDAQ:RAPT)
Number of Hedge Fund Holders: 21
RAPT Therapeutics, Inc. (NASDAQ:RAPT) is a biotech company that has solid business fundamentals, a trait not particularly common with clinical-stage biotech firms. The impressive drug pipeline of the firm is one reason behind this. In late September, the firm announced positive topline results from Phase 1 trials of RPT193, a therapy for patients with atopic dermatitis. The company also beat market expectations on earnings per share and revenue in the second quarter.
Securities filings reveal that Yale University owned 16,000 shares in RAPT Therapeutics, Inc. (NASDAQ:RAPT) at the end of the second quarter of 2021 worth over $512,000, representing 0.18% of the portfolio.
Among the hedge funds being tracked by Insider Monkey, New York-based firm Perceptive Advisors is a leading shareholder in RAPT Therapeutics, Inc. (NASDAQ:RAPT) with 2.4 million shares worth more than $78 million.
7. Asana, Inc. (NYSE:ASAN)
Number of Hedge Fund Holders: 22
In early September, Asana, Inc. (NYSE:ASAN) reported earnings for the second quarter, posting earnings per share of -$0.23, beating predictions by $0.03. The revenue over the period was $89 million, beating estimates by $7 million. The share price of the firm jumped by more than 4% following the earnings beats. KeyBanc recently raised the price target on the stock to $143 from $85 and maintained an Overweight rating, underlining that there was confidence in the ability of the firm to deliver enterprise-focused solutions.
Regulatory filings show that Yale University owned more than 85,000 shares in Asana, Inc. (NYSE:ASAN) at the end of June 2021 worth $5.32 million, representing 1.90% of the portfolio.
At the end of the second quarter of 2021, 22 hedge funds in the database of Insider Monkey held stakes worth $592 million in Asana, Inc. (NYSE:ASAN), the same as in the preceding quarter worth $374 million.
6. Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN)
Number of Hedge Fund Holders: 27
Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN) is a biopharmaceutical company based in Connecticut. It mostly focuses on developing treatments for neurological and other rare disorders. The firm recently announced the enrollment of the first patient in a trial for BHV-1100, a drug under development for the treatment of multiple myeloma. HC Wainwright has a Buy rating on the stock with a price target of $160.
Yale University owned more than 11,600 shares in Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN) at the end of the second quarter of 2021 worth over 1.13 million, representing 0.41% of the portfolio.
Among the hedge funds being tracked by Insider Monkey, London-based investment firm Marshall Wace LLP is a leading shareholder in Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN) with 2.7 million shares worth more than $265 million.
Microsoft Corporation (NASDAQ:MSFT), DocuSign, Inc. (NASDAQ:DOCU), and Lyft, Inc. (NASDAQ:LYFT) are some of the elite stocks to buy right now, just like Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN).
In its Q1 2021 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN) was one of them. Here is what the fund said:
“Biohaven Pharmaceutical Holding Company Ltd. is a biotechnology company dedicated to neurologic drug discovery. It launched its lead asset, migraine medication Nurtec, last year, and the company is transitioning towards profitability. Shares declined when Biohaven issued a secondary offering in March that took investors by surprise and seemed early in relation to an expected second indication for Nurtec in the prophylactic prevention of migraine, which expands its market. We exited our position.”
Click to continue reading and see Yale University Stock Portfolio: Top 5 Picks.
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Disclosure. None. Yale University Stock Portfolio: Top 10 Picks is originally published on Insider Monkey.
