10 Stocks George Soros and Insiders Are Crazy About

In this article, we will take a detailed look at the 10 Stocks George Soros and Insiders Are Crazy About.

The strange calm in the US stock markets following the latest hotter-than-expected CPI report has analysts scratching their heads. Many expected stocks to fall after the latest inflation data as a resurgence of inflation could throw water on rate cuts expectations. However, many market experts are examining the latest inflation report and believe it won’t move the needle for the Fed when it comes to the central bank’s planned rate cuts later this year. Kevin Gordon, senior investment strategist at Schwab, said in a note on March 12 that while the “stickiness” of inflation might look worrying, there are some aspects in the report which are “encouraging.”

“Key consumer staples items like food prices fell in February, so goods deflation helped put downward pressure on overall CPI and worked against upward pressure from energy prices.”

Principal Financial Group also said in its note on March 12 that inflation resurgence is unlikely despite the data in the latest CPI report. However, the firm said if March CPI data also comes in hotter than expect, it could force the Fed to postpone interest rate cuts to the second half of the year.

Higher for Longer and the “Virtuous Cycle” of AI Investments

Some analysts also believe we are in for a higher for longer scenario where the Fed could keep interest rates higher for several more months. But that would also be ok for investors since rising productivity and earnings expectations could offset the effects of higher rates on the stock market. Bank of America recently increased its EPS estimate for the S&P 500 for the year end to $250, a new Street high. AI is at the core of Bank of America’s bullish thesis, since it believes the AI boom has created a “virtuous cycle” of investments in the industry.

Bank of America believes 2023 was a “transition year” for the markets and companies are now getting used to higher interest rates and “tepid” demand.

Bank of America expects major tech companies like Microsoft, Amazon, Alphabet and Meta Platforms to spend a whopping $180 billion in capital expenditures in 2024. These new investment cycles driven by the AI demand would also help other sectors, according to the bank, causing a bifurcation of market returns which were, until last year, enjoyed only by the Magnificent Seven group of stocks.

Methodology

For this article we decided to take a look at the stocks liked by billionaire George Soros’s fund as well as corporate insiders. To find these stocks we first scanned Soros Fund Management Q4’2023 portfolio and then picked 10 stocks that have seen high insider buying activity over the past one year. We used Insider Monkey’s insider trading stock screener to find stocks with insider buying activity. Some top names in the list include Marriott Vacations Worldwide Corp (NYSE:VAC), Energy Transfer LP Unit (NYSE:ET) and Nike Inc (NYSE:NKE). But why is it important to keep tabs on hedge fund and insider activity? Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here).

10. Augmedix Inc (NASDAQ:AUGX)

Soros Fund Management’s Stake: $517,819

Medical documentation and clinical support solutions company Augmedix Inc (NASDAQ:AUGX) was a new arrival in George Soros’ fund portfolio since Soros Fund Management bought 88,516 shares of Augmedix Inc during the fourth quarter of 2023.

On November 20, 2023, Redmile Group, LLC, which has a director status and a 10% stake in Augmedix Inc, bought 1.5 million shares of Augmedix Inc at $4.00 per share. Since then the stock is down by about 28%.

9. ONEOK Inc (NYSE:OKE)

Soros Fund Management’s Stake: $3,826,498

Natural gas company ONEOK Inc (NYSE:OKE) is one of the stocks George Soros and insiders are buying. ONEOK Inc’s (NYSE:OKE) CEO Pierce H. Norton on June 29, 2023, bought 24,607 shares of ONEOK Inc at $60.96 per share. Since then, the stock has gained about 26% through March 12. George Soros’ fund reported owning a $3.8 million stake in ONEOK Inc as of the end of 2023.

8. Enterprise Products Partners LP (NYSE:EPD)

Soros Fund Management’s Stake: $5,006,500

William Montgomery, a director at natural gas and crude oil pipeline company Enterprise Products Partners LP (NYSE:EPD), bought 50,000 shares of Enterprise Products Partners LP at $26.60 per share on August 4,2023. Since then the stock has gained about 7%. As of the end of the fourth quarter of 2023, George Soros’ fund had a $5 million stake in Enterprise Products Partners LP.

In addition to EPD, hedge funds also like Marriott Vacations Worldwide Corp, Energy Transfer LP Unit and Nike Inc.

Last month, the company announced Q4 results and talked about important financial updates:

“We generated $7.6 billion of distributable cash flow in 2023, providing 1.7 times coverage, and we retained $3.2 billion. We set nine financial records and 13 operating records in 2013. Our 2023 operating results included records in NGL pipeline transportation, ethane exports, total NGL marine terminal volumes, NGL fractionation volumes, fee based natural gas processing volumes and crude pipeline and natural gas transportation volumes barrels of oil equivalent per day enterprise transported a record 12.2 million barrels a day in 2023, compared to 11.2 million barrels a day in 2022. During the fourth quarter, we transported 12.7 million barrels a day, compared to 11.5 million barrels a day in the fourth quarter of 2022.

We exported a record 2.3 million barrels a day of liquid hydrocarbons. That includes everything from crude oil to LPGs to ethane, refined products and basic petrochemicals, ethane and propylene. When you look at our exports, it’s clear that enterprise is not a one trick pony. It’s quite remarkable that volumes across all our pipes and facilities increased sequentially each quarter in 2023, supported by the strong supply and demand fundamentals for hydrocarbons from the Permian and other basins we serve integrated with the midstream services we have, including exports that we just discussed. Relative to commodity markets, 2023 was a relatively weak year, especially for natural gas and natural gas liquids. Nonetheless, Enterprise proved once again that we don’t need really high prices to make substantial returns.”

Read the full earnings call transcript here.

7. Evolus Inc. (NASDAQ:EOLS)

Soros Fund Management’s Stake: $5,791,500

Skincare and beauty solutions company Evolus Inc. (NASDAQ:EOLS) is one of the stocks in George Soros’ fund portfolio that also saw insider buying activity over the past few months. On August 15, 2023, Vikram Malik loaded up on 174,967 shares of Evolus Inc. at $7.41 per share. Since then the stock has jumped by about 38%.

As of the end of the fourth quarter of 2023, George Soros’ hedge fund reported owning a $5.8 million stake in Evolus Inc..

Earlier this month, during its Q4 earnings call, the company talked about important business updates and guidance:

 “Non-GAAP loss from operations for the full year excludes stock-based compensation expense, revaluation of the contingent royalty obligation and depreciation and amortization. Turning to the balance sheet. We ended the year with $62.8 million cash compared to $38.7 million at September 30, 2023. In the fourth quarter, we had a record low quarterly cash use of $0.9 million, excluding the $25 million tranche drawn under the Pharmacon line of credit and generated cash from operating activities of $0.8 million. Net cash used in the fourth quarter of 2023 continued its sequential quarterly decrease throughout 2023, further demonstrating our continued progress towards cash flow breakeven.

Given the capital-efficient nature of our filler agreements, we continue to expect our liquidity to fully fund us the profitability and beyond. Before we turn to Q&A, I would like to summarize our 2024 guidance. Total revenue for the full year of $255 million to $265 million, this equates to 26% to 31% growth for the full year. Adjusted gross margins in the range of 68% to 71%. Full year 2024 non-GAAP operating expenses between $185 million and $190 million. Profitability, defined as positive non-GAAP operating in the fourth quarter of 2024 and for the full year 2025. As a point of note, due to onetime filler launch expenses within 2025, profitability may not be achieved every quarter. Other modeling assumptions for 2024 include quarterly interest expense of $4.4 million and full year weighted average shares outstanding of approximately 57 million.

Looking beyond 2024, we continue to target total revenue of at least $700 million in 2028, driven by continued growth in share gains in our neurotoxin business in the U.S. and international markets along with the growing contribution from our line of fillers that begins in 2025. This equates to a compounded annual operate of 28% on a total addressable market of approximately $6 billion today, growing to approximately $10 billion in 2028.”

Read the entire earnings call transcript here.

6. Immunovant Inc (NASDAQ:IMVT)

Soros Fund Management’s Stake: $5,898,200

Immunovant Inc (NASDAQ:IMVT) ranks sixth in our list of the stocks George Soros and insiders are buying. Roivant Sciences Ltd., which has a director status at Immunovant Inc’s (NASDAQ:IMVT) board as well as a 10% stake, bought 1,526,316 IMVT shares at $38.00 per share on October 2, 2023. Since then the stock has fallen about 9%.

George Soros, via his fund, had a $6 million stake in Immunovant Inc as of the end of the fourth quarter of 2023.

Hedge funds are also buying Marriott Vacations Worldwide Corp, Energy Transfer LP Unit and Nike Inc.

Baron Health Care Fund stated the following regarding Immunovant, Inc. in its fourth quarter 2023 investor letter:

“We initiated a position in Immunovant, Inc. (NASDAQ:IMVT), a clinical-stage biotechnology company developing therapies for autoimmune diseases. During the quarter, the company announced data from a Phase 1 clinical trial of IMVT-1402, an FcRn inhibitor that has broad potential applicability to multiple autoimmune diseases. The data showed that IMVT-1402 delivered dose dependent and deep reductions in disease-causing auto-antibodies with minimal changes in albumin and low-density lipoprotein cholesterol. The company’s first generation FcRn inhibitor has shown strong efficacy but there have been questions about the safety profile of the drug. This promising data makes Immunovant a real competitor in the FcRn inhibitor drug class, though Immunovant is behind argenx in terms of timing. We think both companies can be successful given the broad array of autoimmune diseases that can potentially be treated with a safe and effective FcRn inhibitor.”

5. Energy Transfer LP Unit (NYSE:ET)

Soros Fund Management’s Stake: $6,592,950

Kelcy Warren, who is the Executive Chairman and Chairman of the Board of Directors of Energy Transfer LP Unit, bought 3 million shares of Energy Transfer LP Unit at $12.96 per share on August 17. Since then through March 12 the stock has gained about 16%.

George Soros’ fund had a $6.6 millions stake in Energy Transfer LP Unit as of the end of the fourth quarter of 2023.

Silver Beech Capital made the following regarding Energy Transfer LP in its fourth quarter 2023 investor letter:

Energy Transfer LP (NYSE:ET) owns and operates the largest and most balanced collection of energy infrastructure assets in the United States. ET’s assets include 125,000 miles of oil and natural gas pipelines, export facilities on both the Gulf Coast and East Coast, and more than 1 million barrels per day of natural gas liquid fractionation capacity. ET accounts for 20% of worldwide natural gas liquid exports. Further, ET is uniquely connected to every major hydrocarbon basin in the United States.

By assembling energy infrastructure to gather, process, transport, and store hydrocarbons, ET connects exploration and production companies (“E&Ps”) with downstream end users such as gas stations, utilities, and export facilities. As an end-to-end midstream solution, ET enables its customers to focus on their portion of the value chain without the burden of significant but essential midstream logistics. ET’s services thus add tremendous value to all constituents of the energy marketplace.

Though natural gas is a relatively clean source of fuel, restrictive federal and state regulations and other permissions severely restrict the building of natural gas pipelines and other infrastructure in North America that would help facilitate abundant hydrocarbon production. Pipelines are by far the cheapest and greenest method of transporting hydrocarbons; pipelines reduce emissions from truck transport and reduce congestion on highways, rail, and shipping routes…” (Click here to read the full text)

4. Renaissancere Holdings Ltd (NYSE:RNR)

Soros Fund Management’s Stake: $19,652,920

Insurance and business services company Renaissancere Holdings Ltd (NYSE:RNR) is one of the stocks on the radar of billionaire George Soros’ fund and corporate insiders. Renaissancere Holdings Ltd’s (NYSE:RNR) CEO Kevin J. O’Donnell on May 25 amassed 13,020 shares of Renaissancere Holdings Ltd at $192.00 per share. Since then through March 12 the stock has gained about 21%. George Soros’ fund had a stake worth about $20 million in Renaissancere Holdings Ltd heading into 2024.

TimesSquare Capital U.S. Mid Cap Growth Strategy made the following comment about RenaissanceRe Holdings Ltd. in its Q3 2023 investor letter:

“In Financials, we prefer well-placed insurance companies and niche businesses while tending to avoid banks which face credit deterioration and rising deposit costs. RenaissanceRe Holdings Ltd. (NYSE:RNR), a provider of reinsurance and insurance products, surged ahead by 6%. Its second quarter numbers were solid across underwriting, property catastrophe premiums, investment income, and fee income. While there was an impact from severe storms during the quarter, RenRe’s losses were modest.”

3. Alteryx Inc (NYSE:AYX)

Soros Fund Management’s Stake (CALL): $21,382,344

Alteryx Inc (NYSE:AYX) ranks third in our list of the stocks George Soros’s hedge fund and insiders are buying. On February 15, Dean Stoecker, who is a director at Alteryx Inc’s (NYSE:AYX) board as well as a 10% stake owner, bought 42,500 shares of Alteryx Inc at $47.90 per share. Since February 15 through March 12 the stock has gained about 0.7%. As of the end of the fourth quarter of 2023, 48 hedge funds tracked by Insider Monkey had stakes in the California-based computer software company. The most notable stake in Alteryx Inc is owned by Josh Resnick’s Jericho Capital Asset Management which owns a $123 million stake in the computer software company Alteryx Inc.

George Soros’ fund owns CALL options on 453,400 shares of Alteryx Inc as of the end of the fourth quarter of 2023.

2. Nike Inc (NYSE:NKE)

Soros Fund Management’s Stake: $25,700,690

Nike Inc ranks second in our list of the stocks George Soros and corporate insiders are buying. As of the end of the fourth quarter of 2023, George Soros’ fund had a $26 million stake in Nike Inc. Bob Swan, a director at Nike Inc’s (NYSE:NKE) board, bought 13,072 shares of Nike Inc on October 2 at $96.13 per share. On that day the stock was trading at around $94.56. Nike Inc’s (NYSE:NKE) stock price has jumped about 6% since then.

Amalthea Fund stated the following regarding NIKE, Inc. in its fourth quarter 2023 investor letter:

“NIKE, Inc. (NYSE:NKE) of change of strategy: Fast forward a few years and Nike has had a change of strategy that was an Exocet to shoe industry retailers. Nike (who do not sell on Amazon) decided (accurately) that they had the hot product and wanted to drive sales through their own (mostly online) channels. They wanted to capture the retail margin.

Nike used to have 30,000 wholesale arrangements (retailers who sold their product). They cut this number sharply, down to 3000 and told people they were going to 1800. Small shoe retailers lost their core brand. Many failed…” (Click here to read the full text)

1. Marriott Vacations Worldwide Corp (NYSE:VAC)

Soros Fund Management’s Stake (CALL): $35,980,918

John E. Geller Jr., the CEO of Marriott Vacations Worldwide Corp, loaded up on 5,000 shares of Marriott Vacations Worldwide Corp at $112.84 per share on August 7. On that day the stock closed trading at around $112.47. Since then stock has lost about 15% in value as of March 12.

George Soros’s hedge fund owns CALL options on 250,000 Marriott Vacations Worldwide Corp shares, as of the end of 2023.

Baron Focused Growth Fund stated the following regarding Marriott Vacations Worldwide Corporation in its fourth quarter 2023 investor letter:

“Shares of timeshare company Marriott Vacations Worldwide Corporation (NYSE:VAC) fell in the quarter, driven by soft sales of timeshare units due to higher interest rates and the slow ramp of a new product offering. A default rate that was higher than the company had anticipated forced it to take a charge to increase its reserves, pressuring earnings and cash flow. We opted to exit our position due to the increased stress on its consumer base and a resulting increase in financial leverage, which we found inappropriate for a focused fund.”

Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below. You can also look at the Dividend Contenders List Ranked By Yield: Top 25 and the 10 Stocks Warren Buffett and Insiders Are Crazy About.

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This article is originally published at Insider Monkey.