In this article, we discuss the top 4 stock picks of Dennis Goldstein’s Rip Road Capital. If you want our detailed analysis of these stocks, go directly to 9 Stocks To Buy According To Dennis Goldstein’s Rip Road Capital.
4. PROG Holdings, Inc. (NYSE:PRG)
Rip Road Capital’s Stake Value: $27,928,000
Percentage of Rip Road Capital’s 13F Portfolio: 8.24%
Number of Hedge Fund Holders: 27
PROG Holdings, Inc. (NYSE:PRG) is a financial technology company from Utah, specializing in progressive leasing, revolving credit products, and Buy Now Pay Later (BNPL) options to customers of all credit backgrounds. PROG Holdings, Inc. (NYSE:PRG) is one of the top stocks in Dennis Goldstein’s Q3 portfolio.
Rip Road Capital owns 664,800 shares in PROG Holdings, Inc. (NYSE:PRG), worth $27.9 million, representing 8.24% of the firm’s Q3 portfolio.
At the end of the third quarter of 2021, 27 hedge funds were long PROG Holdings, Inc. (NYSE:PRG), down from 37 in Q2.
Here is what Diamond Hill Capital has to say about PROG Holdings, Inc. (NYSE:PRG) in its Q1 2021 investor letter:
“Bottom contributors included PROG Holdings, the largest virtual lease-to-own provider in the U.S. Weaker traffic at PROG’s brick-and-mortar partners and supply chain issues impacted availability of furniture and appliances to lease. We anticipate these issues should improve later in 2021. Additionally, an inquiry into lease-to-own providers by California’s relatively new Department of Financial Protection and Innovation may lead to an increased regulatory burden. However, management is executing well on its integration of e-commerce capabilities with existing partners and is looking to expand with third-party platforms. Further, the business model is attractive as it is relatively asset-light and generates strong and consistent free cash flow.”
3. GoodRx Holdings, Inc. (NASDAQ:GDRX)
Rip Road Capital’s Stake Value: $31,398,000
Percentage of Rip Road Capital’s 13F Portfolio: 9.26%
Number of Hedge Fund Holders: 26
GoodRx Holdings, Inc. (NASDAQ:GDRX) is a healthcare company operating a telemedicine platform, a website, and a mobile application that offers coupons to users for medicine discounts and compares prescription drug prices across the US. GoodRx Holdings, Inc. (NASDAQ:GDRX) has millions of monthly users, and is one of Dennis Goldstein’s top stock picks for the third quarter.
Rip Road Capital owns 765,438 shares of GoodRx Holdings, Inc. (NASDAQ:GDRX), amounting to $31.39 million, representing 9.26% of the firm’s Q3 portfolio.
At the end of September, 26 hedge funds were bullish on GoodRx Holdings, Inc. (NASDAQ:GDRX), as compared to 28 funds in the previous quarter.
Here is what Saga Partners has to say about GoodRx Holdings, Inc. (NASDAQ:GDRX) in its Q2 2021 investor letter:
“The Saga Portfolio first bought GoodRx at the end of 2020 and has added to it throughout 2021. As it has become a larger position in the Portfolio, it makes sense to explain the investment thesis in more detail.
For those who don’t care to understand the prescription drug value chain, feel free to skip over this section. While few readers may really care about the fairly complicated prescription drug value chain, it is important to review in order to understand the role that GoodRx plays within the ecosystem. This is my best attempt in trying to explain it in a few paragraphs.
Like many other parts of the U.S. healthcare system, prescription drugs suffer from complex and non-transparent pricing with access largely controlled by health plan payers. The majority of people in the U.S. have insurance provided by either their employer or a government program such as Medicare or Medicaid. Consumers largely rely on third parties to determine which drugs are covered by their health plan, and therefore which drugs may or may not be affordable.
Pharmacy benefit managers (PBMs) play a significant role and sit in the middle of three different parties. They are the intermediary between health insurers, pharmacies, and drug manufacturers. Health insurers hire PBMs to manage prescription drug plans for their covered population. PBMs negotiate on behalf of the health insurer with pharmacies. Pharmacies enter pricing contracts with PBMs in an effort to drive more demand to the store…” (Click here to see the full text)
2. Pinterest, Inc. (NYSE:PINS)
Rip Road Capital’s Stake Value: $31,774,000
Percentage of Rip Road Capital’s 13F Portfolio: 9.37%
Number of Hedge Fund Holders: 58
Pinterest, Inc. (NYSE:PINS) is a social platform that allows people to share creative images, ideas, videos, and animated GIFs, which can be saved by other users to create mood boards for inspiration.
Rip Road Capital owns 623,636 shares in Pinterest, Inc. (NYSE:PINS), valued at $31.7 million, making up 9.37% of the firm’s third quarter 13F portfolio.
At the end of the third quarter, 58 hedge funds were long Pinterest, Inc. (NYSE:PINS), down from 63 in the previous quarter.
Here is what Alger has to say about Pinterest, Inc. (NYSE:PINS) in its Q3 2021 investor letter:
“Pinterest is an image sharing and social media service designed to help consumers discover product information and save the information on the internet using images and, on a smaller scale, animated GIFs and videos, in the form of Pinboards. The company shows consumers visual recommendations, called Pins, based on their personal tastes and interests. Pinterest provides advertisers with information on consumer activities, such as becoming inspired by images, as well as other points along the sales funnel, which is the process in which potential customers become purchasers of products. Shares of Pinterest underperformed after the company reported a larger-than expected decline in monthly active users (MAU) and provided guidance for the third quarter that included revenue growth of 40%, which was in line with consensus. Management didn’t provide MAU guidance for the third quarter due to engagement headwinds. These headwinds resulted from the economy reopening, which means consumers may spend less time online because they are commuting and venturing out for shopping, entertainment and social events. We believe the company appears to be losing its pandemic tailwinds that involved increased online shopping. We have sold the position.”
1. Sea Limited (NYSE:SE)
Rip Road Capital’s Stake Value: $33,530,000
Percentage of Rip Road Capital’s 13F Portfolio: 9.89%
Number of Hedge Fund Holders: 117
Rip Road Capital holds a $33.53 million stake in Sea Limited (NYSE:SE), which represents 9.89% of the firm’s 13F portfolio for the third quarter.
Sea Limited (NYSE:SE) is highly demanded by hedge funds, with 117 funds tracked by Insider Monkey owning stakes in Sea Limited (NYSE:SE) at the end of September.
Barclays analyst Jiong Shao on November 2 kept an Overweight rating on the stock, with a $427 price target. Shao categorizes Sea Limited (NYSE:SE) as the leading e-commerce platform and online game developer in the Southeast Asian market.
Here is what Tao Value has to say about Sea Limited (NYSE:SE) in its Q2 2021 investor letter:
“Sea continued to execute above expectation. The gaming business continued strong momentum, recording bookings of $1.1 billion, growing 117% y-o-y. The major franchise Free Fire showed no sign of slowing down in the established ASEAN & LatAm market and received positive reception from new markets like the US. On the e-commerce side, Shopee demonstrated early success in expanding to Brazil, by adopting a low-price category & gamification strategy. For 2021, Shopee is now the top downloaded e-commerce app in Brazil, almost 2x of the second-place local leader Mercado Libre (MELI). I also see the most promising development is in its FinTech business – SeaMoney, which more than doubled its revenue in Q1 2021 from the previous quarter! With online lending products rolling out, SeaMoney is poised to grow rapidly, becoming the 3rd growth curve for Sea.”
You can also take a look at 10 Stocks That Beat Profit Expectations and 9 Stocks To Buy According To Carson Yost’s Yost Capital Management.
