In this article, we talk about the 10 best stocks to buy now according to billionaire Paul Tudor Jones.
Paul Tudor Jones is known for his global macro investing, which seeks to analyze national economies, geo-political events, international trade relations, and other market factors to make bets on interest rates, currencies, and other commodities. The 67-year old with a current net worth of $7.3 billion founded Tudor Investment Corp in 1980, and is famous for predicting the ‘Black Monday’ 1987 stock market crash, making upwards of $100 million due to his large short positions.
Recession Fears
Jones noted in May that investors should hold their capital during these challenging times. With a hawkish Fed and spiraling inflation, Jones expressed his fears that the economy could soon plunge into a recession, and noted that now wasn’t the time to own bonds and stocks. He cautioned that the Fed was going through one of the most challenging moments in its history, trying to balance slowing growth and rising prices. The billionaire hedge fund manager advised investors to use “simple trend-following strategies,” and make quick trades in the market to profit off the ongoing volatility.
On June 14, Jones told CNBC that the idea that inflation was transitory just didn’t seem right to him, and that he would “go all in on inflation trades” if the Fed didn’t seriously take into account rising prices in its policy review this week. He also expressed his bullish thesis on Bitcoin as a “portfolio diversifier” and a significant wealth generator. On the current market situation, Jones said that he preferred to have 5% of his portfolio in each of gold, bitcoin, cash and commodities, and would wait to see the Fed’s direction until deciding what to do with the remaining 80%.
Still, Paul Tudor Jones bought 637 new stocks and increased his stakes in 588 equities during the first quarter of 2022. He also sold out of more than 1,000 positions and reduced his holdings in 575 stocks. Tudor Investment Corp’s 13F portfolio was valued at $4.27 billion in the first quarter, with a top 10 holdings concentration of 12.22%. Some of the most prominent stocks in the billionaire’s portfolio include Zoom Video Communications, Inc. (NASDAQ:ZM), Airbnb, Inc. (NASDAQ:ABNB), and Amazon.com, Inc. (NASDAQ:AMZN), along with others mentioned below.
Our Methodology
10 Best Stocks to Buy Now According to Billionaire Paul Tudor Jones
10. Turquoise Hill Resources Ltd (NYSE:TRQ)
Tudor Investment Corp’s Stake Value: $20.74 million
Percentage of Tudor Investment Corp’s 13F Portfolio: 0.48%
Number of Hedge Fund Holders: 21
First up is Turquoise Hill Resources Ltd (NYSE:TRQ), a Canadian mining company which operates the Oyu Tolgoi copper-gold mine located in Southern Mongolia. It operates as a subsidiary of Rio Tinto plc (NYSE:RIO).
According to regulatory filings for the first quarter, Paul Tudor Jones owned roughly 690,000 shares of Turquoise Hill Resources Ltd valued at $20.7 million, representing 0.48% of his total portfolio. This was a 9% increase in stake over the previous quarter, when the billionaire owned nearly 635,000 shares of the mining company.
In 2021, Turquoise Hill Resources Ltd posted revenue of $1.97 billion, up 82.81% on a year-over-year basis. With the global spotlight on commodities, and a P/E (price to earnings) ratio of 9.42x, Turquoise Hill Resources Ltd is an attractive, undervalued stock in the portfolio of Paul Tudor Jones.
On May 11, Canaccord analyst Dalton Baretto maintained a ‘Buy’ rating on Turquoise Hill Resources Ltd shares and raised the price target on it to C$45 from C$43. The analyst sees multiple factors improving the company’s risk/reward profile, including an updated capex estimate, a manageable funding gap, a new deal with the Mongolian Government, and a C$34 per share all-cash proposal by majority shareholder Rio Tinto Group to buy the remaining 49% of the company’s shares.
Of the 900+ hedge funds in the Q1 database of Insider Monkey, 21 held positions in Turquoise Hill Resources Ltd with a combined value of $1.04 billion. This shows growing investor interest over the previous quarter, when 12 funds were bullish on TRQ shares. With a $566 million position consisting of 18.82 million shares, Pentwater Capital Management was the biggest shareholder of Turquoise Hill Resources Ltd in the first quarter of 2022.
Along with Zoom Video Communications, Inc., Airbnb, Inc., and Amazon.com, Inc., Turquoise Hill Resources Ltd is an exciting stock in Paul Tudor Jones’ portfolio.
9. B. Riley Financial, Inc. (NASDAQ:RILY)
Tudor Investment Corp’s Stake Value: $21.81 million
Percentage of Tudor Investment Corp’s 13F Portfolio: 0.51%
Number of Hedge Fund Holders: 21
B. Riley Financial, Inc. (NASDAQ:RILY) is a California-based financial services firm, dealing in capital markets, wealth management, and financial consulting, among other services. It declared a $1 per share quarterly dividend on April 29, which boasts an impressive yield of 9.2% as of July 1.
Paul Tudor Jones’ 13F portfolio contained roughly 312,000 shares of B. Riley Financial, Inc. valued at $21.8 million and amounting to a 0.51% slice of the overall portfolio. In comparison to the previous quarter, this was an 8% reduction in the size of the holding.
A careful review of the Q1 database of Insider Monkey showed that 21 hedge funds held $115.4 million worth of positions in B. Riley Financial, Inc. on March 31, compared to 24 hedge funds with $147.2 million worth of stakes in the firm a quarter earlier. The company’s largest Q1 shareholder was Royce & Associates with a nearly $30 million stake.
8. DigitalOcean Holdings, Inc. (NYSE:DOCN)
Tudor Investment Corp’s Stake Value: $27.48 million
Percentage of Tudor Investment Corp’s 13F Portfolio: 0.64%
Number of Hedge Fund Holders: 26
DigitalOcean Holdings, Inc. (NYSE:DOCN) is a New York-based firm which provides cloud computing services to small and medium-sized businesses. With 475,000 shares valued at $27.5 million, DOCN stock represented 0.64% of Tudor Investment Corp’s total Q1 portfolio.
On May 12, Goldman Sachs analyst Gabriela Borges initiated coverage of DigitalOcean Holdings, Inc. with a ‘Buy’ rating and a $49 price target, implying 59% upside. She sees DOCN as the dominant leader in the cloud infrastructure market for small-to-mid-sized businesses and individual developers. Borges thinks the company can achieve $1 billion in revenue in 2024, with $200 million in free cash flow. The analyst further noted that positive free cash flow coupled with acquisition “optionality” should provide upside potential to the stock in the current environment. In late May, DigitalOcean Holdings, Inc. announced a $300 million share buyback program.
Investor sentiment around DigitalOcean Holdings, Inc. was positive in the first quarter. A total of 26 hedge funds reported having ownership stakes in the company as of the end of March, compared to 25 funds a quarter earlier. With a stake consisting of 800,000 shares worth more than $46 million, Engle Capital was the leading shareholder of DigitalOcean Holdings, Inc. in the first quarter.
7. Zynga Inc. (NASDAQ:ZNGA)
Tudor Investment Corp’s Stake Value: $33.94 million
Percentage of Tudor Investment Corp’s 13F Portfolio: 0.79%
Number of Hedge Fund Holders: 63
Zynga Inc. (NASDAQ:ZNGA) was acquired by video game giant Take-Two Interactive Software (NASDAQ:TTWO) in May 2022, as part of a $12.7 billion deal which saw Zynga stockholders receive $3.50 in cash and 0.0406 shares of TTWO in exchange for one share of Zynga common stock. Zynga Inc. is a developer of popular mobile video games, including Farmville and Words With Friends. This acquisition is the latest in a string of deals moving the video game industry towards consolidation.
In anticipation of the acquisition, investors significantly increased their exposure to Zynga Inc., and Paul Tudor Jones was one of them. He increased his stake in the company by 212%, to come in at a value of nearly $34 million.
Overall, 63 hedge funds were bullish on Zynga Inc. at the end of Q1 2022, up from just 47 in the previous quarter, showing a massive hike in hedge funds’ bullishness on the stock.
6. Liberty Broadband Corporation (NASDAQ:LBRDA)
Tudor Investment Corp’s Stake Value: $42.76 million
Percentage of Tudor Investment Corp’s 13F Portfolio: 1%
Number Of Hedge Fund Holders: 26
Liberty Broadband Corporation (NASDAQ:LBRDA) is a communications firm based in the United States. It offers voice, video, internet and TV services to consumers through two segments: Charter Communications, and GCI Holdings.
Hedge fund sentiment was positive on Liberty Broadband Corporation in Q1. As of the end of the first quarter, 26 hedge funds held positions in the company, compared to 22 funds a quarter earlier. The total value of hedge funds’ Q1 positions in Liberty Broadband Corporation was more than $606 million. A massive $1.13 billion position made Eagle Capital Management the largest shareholder of the company in the first quarter.
On May 10, Deutsche Bank analyst Bryan Kraft lowered the firm’s price target on Liberty Broadband Corporation to $158 from $196 and maintained a ‘Buy’ rating on the shares.
Alphyn Capital Management, an asset management firm, discussed a few stocks in its Q1 2022 investor letter and Liberty Broadband Corporation was one of them. Here is what was said:
“We part-financed the additions to Amazon and Wayfair by trimming some Liberty Broadband. Liberty Broadband Corporation is a HoldCo and tracking stock whose primary holding is Charter Communications. Charter benefits from its extensive network of cable assets that can provide higher bandwidth internet at better prices than offerings from traditional telecom and satellite carriers. Moreover, with excellent management and capital stewardship, Charter has increased its high-margin broadband subscriber base despite losing some video subscribers to “cord-cutting.”
Nevertheless, competition is intensifying, with telecom companies launching aggressive Fiber-To-The-Home upgrade plans and new entrants emerging with Fixed Wireless technologies. Cable’s co-axial lines are, for once, the inferior technology compared to FTTH. While Charter has many ways to upgrade its lines to remain competitive in the medium term, it no longer has a distinct advantage. As a result, in markets with fiber competition, cable companies typically have a 50% market share vs. the 80% market share they enjoy without fiber competition.
With Fixed Wireless, Cable has a strong advantage in owning the network for internet backhaul, but it is more difficult to predict the longer-term competitive environment. In both cases, moving from a near-monopoly to a duopoly, or longer-term an oligopoly, likely comes with weaker pricing power and slower subscriber growth. These considerations warranted trimming our Liberty Broadband Corporation position, and we will monitor developments closely.”
Just like Zoom Video Communications, Inc., Airbnb, Inc., and Amazon.com, Inc., Paul Tudor Jones is bullish on Liberty Broadband Corporation in 2022.
5. Starz Acquisition LLC (NASDAQ:STRZA)
Tudor Investment Corp’s Stake Value: $43.71 million
Percentage of Tudor Investment Corp’s 13F Portfolio: 1.02%
Number of Hedge Fund Holders: N/A
Media firm Starz Acquisition LLC (NASDAQ:STRZA) was acquired by Lions Gate Entertainment Corp. (NYSE:LGF-A) in a November 2021 deal worth $4.4 billion. This acquisition allowed Lions Gate to expand its global distribution capabilities, and boost its position in the premium scripted television industry.
Tudor Investment Corp owned 956,000 shares of Starz Acquisition LLC in the first quarter of 2022, valued at $43.7 million and representing 1.02% of the fund’s total portfolio. This was a boost of 19% over the previous quarter, when Jones’ fund owned 805,000 STRZA shares. Warren Buffett’s Berkshire Hathaway was the largest shareholder of Starz Acquisition LLC in the first quarter, with 43.20 million shares worth almost $2 billion.
4. American National Group Inc. (NASDAQ:ANAT)
Tudor Investment Corp’s Stake Value: $44.01 million
Percentage of Tudor Investment Corp’s 13F Portfolio: 1.03%
Number of Hedge Fund Holders: 21
American National Group Inc. (NASDAQ:ANAT) is a Texas-based provider of insurance, annuities, and pension products to consumers in the United States and Puerto Rico. The company has been acquired by Brookfield National for $5.1 billion in an all-cash transaction that recently closed on May 25. Jones’ investment firm held nearly 233,000 shares of ANAT in the first quarter, worth $44 million and representing 1.03% of its overall holdings.
At the end of the first quarter of 2022, 21 hedge funds reported ownership positions in American National Group Inc., with an aggregate value of approximately $262 million. Israel Englander’s Millennium Management held a $47.6 million stake in American National Group Inc., and thus ranked as the firm’s largest Q1 shareholder.
3. Airbnb, Inc. (NASDAQ:ABNB)
Tudor Investment Corp’s Stake Value: $47.42 million
Percentage of Tudor Investment Corp’s 13F Portfolio: 1.11%
Number of Hedge Fund Holders: 66
Airbnb, Inc. operates an online platform which lets users rent lease their properties for short-term vacation rentals. It operates in almost every country and region around the globe, with around 100,000 cities worldwide having rentals listed on Airbnb.
On June 3, Truist analyst Naved Khan lowered the firm’s price target on Airbnb, Inc. to $160 from $190 and reiterated a ‘Hold’ rating on the company’s shares. Although travel demand remains on track for a robust recovery in the near-term, the analyst sees some degree of consumer sensitivity to inflationary pressures according to recent data. ABNB shares have slid more than 47% in the first six months of 2022.
Paul Tudor Jones held a $47.4 million stake in Airbnb, Inc. in the first quarter, consisting of roughly 276,000 shares. This represented a 3% increase from the previous quarter, when the billionaire held 269,000 shares of the travel firm.
In total, 66 hedge funds held Airbnb, Inc. stock in their portfolios at the end of the first quarter, with a collective value of $3.69 billion. This showed an uptick in investor sentiment over the previous quarter, when 63 hedge funds were long ABNB shares. The firm’s most prominent shareholder in the first quarter was Renaissance Technologies, with $584.6 million worth of shares.
Asset management firm Tollymore Investment Partners mentioned Airbnb, Inc. in its Q3 2021 investor letter, stating:
“Today disruptors are not typically seeking to replace incumbents entirely. Rather, they break the links in the customer journey, in doing so better aligning monetisation with value creation and minimising externalities. For example, Airbnb broke the link between staying in residential property and owning it. Airbnb is a specific example of a business model innovation which separated asset use from ownership. This is hardly a novel idea; it’s called renting. Rental models lend themselves to assets which are expensive and durable, and where usage is infrequent.”
2. Anaplan, Inc. (NYSE:PLAN)
Tudor Investment Corp’s Stake Value: $89.23 million
Percentage of Tudor Investment Corp’s 13F Portfolio: 2.08%
Number of Hedge Fund Holders: 47
Anaplan, Inc. (NYSE:PLAN) provides business planning software through a subscription-based model, as well as data analytics to enable better decision-making. The company’s products are used by more than 1,000 organizations around the globe, including healthcare, financial, retail, media, tech and the transportation industries, among others.
On June 22, Anaplan, Inc. was acquired by private equity firm Thoma Bravo in an all-cash transaction worth approximately $10.4 billion. This merger was originally announced in March 2022, and valued PLAN stock at $66 per share.
With 1.37 million shares valued at $89.2 million, Paul Tudor Jones’ stake in Anaplan, Inc. amounted to 2.08% of his total Q1 portfolio. This was a massive increase over the previous quarter, when the investor owned just 28,000 shares of the firm.
47 hedge funds were long Anaplan, Inc. at the end of March, with combined holdings worth $2.43 billion. The firm’s largest shareholder in the first quarter of 2022 was Sculptor Capital with a nearly $345 million stake.
Alger, an investment management firm, talked about the business model and performance of Anaplan, Inc. in its Q1 2021 investor letter. Here’s what it said:
“Anaplan, Inc. was among the top detractors from performance. Anaplan is a leading provider of cloud-based business planning software. Anaplan’s software platform aims to solve the most complex planning needs of large global enterprises across various business lines. Unlike traditional business planning software, which is often rigid, siloed and opaque, Anaplan’s platform is designed to enable broader enterprise participation and better workforce collaboration during the business planning process. Through better planning, large enterprises can more effectively allocate resources to cut costs and generate revenue. Today Anaplan has over 1,600 customers across a variety of end markets and business use cases.
Anaplan shares underperformed in the first quarter as part of a broader sector rotation as high-growth software stocks fell out of favor relative to more cyclically exposed investment opportunities. We believe Anaplan’s focus on growth over near-term profit generation negatively impacts the company’s stock in a rising interest rate environment.
Fundamentally, Anaplan had strong fourth quarter earnings result, with the company seeing an acceleration of billings growth and a strong demand pipeline as companies realize the need for a more flexible digital planning solution.”
1. Cerner Corporation (NASDAQ:CERN)
Tudor Investment Corp’s Stake Value: $102.50 million
Percentage of Tudor Investment Corp’s 13F Portfolio: 2.40%
Number of Hedge Fund Holders: 64
Cerner Corporation was the biggest holding in the first-quarter portfolio of Paul Tudor Jones, who owned 1.09 million shares of the firm valued at $102.5 million. The company is a provider of information technology solutions to the healthcare industry. On June 8, cloud giant Oracle Corporation (NYSE:ORCL) completed its $28.4 billion acquisition of Cerner Corporation at $95 per share.
Out of the 912 hedge funds tracked by Insider Monkey at the close of the first quarter, 64 reported bullish bets on Cerner Corporation shares, up from 61 hedge funds a quarter earlier. The company’s largest shareholder was Millennium Management, with a $517 million stake, which was recently hiked by 124%.
Here is what Cooper Investors, an investment management firm, had to say about Cerner Corporation in its Q1 2021 investor letter:
“The investment in Cerner, made just over a year ago, was based on what we perceived to be a Low-Risk Turnaround opportunity as a refreshed management team sought to increase margins, reduce capex and utilize balance sheet latency with buybacks and acquisitions. Taking account of the tough 2020 for Cerner’s hospital client base the company did a reasonable job executing on these initiatives. However, moving into 2021 more recent observations around intentionality and focus led to a reassessment of the investment proposition, particularly relative to the portfolio’s other technology and software investments.”
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