In this piece, we’ll take a look at the 5 Best Stocks to Buy According to Billionaire Dan Loeb. For more stocks, go to 10 Best Stocks to Buy According to Billionaire Dan Loeb.
5. Ovintiv Inc. (NYSE:OVV)
Third Point Stake: $270,443,000
Percentage of Third Point’s Portfolio: 6.4%
Number of Hedge Fund Holders: 47
Ovintiv Inc. (NYSE:OVV) is an oil and gas company with holdings in the Permian, Eagle Ford, Montney, and Duvernay regions. Third Point increased its stake in Ovintiv Inc. (NYSE:OVV) by 172% during the second quarter. At the end of the quarter, the fund held 6,120,000 shares of the company.
On September 26, 2022, Jeanine Wai, an analyst at Barclays, increased her target price on Ovintiv Inc. (NYSE:OVV) to $78. The analyst believes that the company will produce sufficient free cash flow in the future, which has warranted an increase in the price target for the firm.
Here is what Carillon Tower Advisers specifically said about Ovintiv Inc. (NYSE:OVV) in its Q2 2022 investor letter:
Oil and gas exploration and production company Ovintiv Inc. (NYSE:OVV) fell as oil prices faded late in the quarter due to aggressive Fed rate hikes and growing credit fears in emerging markets, a source of demand growth for oil. Although oil and fuel product inventories remain scarce, the Fed has been so aggressive with rhetoric and tightening that the dollar rose sharply and investor sentiment shifted toward anticipating a recession. Ovintiv is a self-help improvement story as it lowers debt levels through cash generation and asset sales, while detailing plans to buy back shares more aggressively and pay a higher dividend.
At the end of Q2 2022, Third Point held the highest stake in Ovintiv Inc. (NYSE:OVV), with an investment value of over $270 million in the company, constituting 6.4% of the fund’s portfolio. According to Insider’s Monkey database, 47 hedge funds owned stakes in the company at the end of the second quarter.
4. UnitedHealth Group Incorporated (NYSE:UNH)
Third Point Stake: $292,769,000
Percentage of Third Point’s Portfolio: 6.92%
Number of Hedge Fund Holders: 91
UnitedHealth Group Incorporated (NYSE:UNH) is a health insurance provider with over 50 million members worldwide. The fund’s exposure to UnitedHealth Group Incorporated (NYSE:UNH) during the previous quarter decreased by 6%. Third Point’s investment value at the end of Q2 2022 amounts to over $292 million.
On October 14, 2022, UnitedHealth Group Incorporated (NYSE:UNH) announced strong results for Q3 2022. The company was able to grow its revenue by 11.8% YoY as it reported a topline of $80.9 billion for the quarter, beating the market estimate by $360 million. Moreover, the normalized EPS of $5.79 posted by the company surpassed consensus estimates by $0.35. The management highlighted that the company the new sales and customer retention remained strong during Q3 2022, and the company has a high amount of order backlog to deal with in the coming quarter.
Here is what Distillate Capital has to say about UnitedHealth Group Incorporated (NYSE:UNH) in its Q2 2022 investor letter:
UnitedHealth Group was among the 2 largest trims at around 1% each. Each stock was up 1% in the quarter compared to the 16% price decline for the S&P 500 and the positions were reduced as the valuations became somewhat less appealing, though still attractive enough to warrant inclusion.
3. SentinelOne, Inc. (NYSE:S)
Third Point Stake: $491,769,000
Percentage of Third Point’s Portfolio: 11.64%
Number of Hedge Fund Holders: 26
SentinelOne, Inc. (NYSE:S) is a cybersecurity solutions provider. Dan Loeb reduced his exposure to SentinelOne, Inc. (NYSE:S) during the second quarter of 2022 by 20%. The fund held 21,078,846 shares of the company at the end of Q2 2022.
On October 06, 2022, Carson Sippel, an analyst at SMBC Nikko Securities, started coverage of SentinelOne, Inc. (NYSE:S) with a price target of $30. The analyst is currently Neutral on the company’s stock. Although the analyst believes that the company is in a strong position to achieve growth and increase its revenue substantially by the fiscal year 2025, the macro-environment remains uncertain, which is why he is currently initiating coverage of the company with a Neutral rating.
Here is what ClearBridge Investments SMID Cap Growth Strategy has to say about SentinelOne, Inc. (NYSE:S) in its Q4 2021 investor letter:
We added six new positions in the fourth quarter. We see next-generation cybersecurity provider SentinelOne, although early in its growth lifecycle, as capable of taking share from legacy players in the antivirus and broader cybersecurity industry.
2. Danaher Corporation (NYSE:DHR)
Third Point Stake: $583,096,000
Percentage of Third Point’s Portfolio: 13.8%
Number of Hedge Fund Holders: 82
Danaher Corporation (NYSE:DHR) designs and markets products in the pharmaceutical and industrial sectors. The fund decreased its stake in the company by 8% during the previous quarter. Third Point Stake in Danaher Corporation (NYSE:DHR) amounts to a value of approximately $583 million.
On October 10, 2022, Luke Sergott, an analyst at Barclays, reduced his price target for Danaher Corporation (NYSE:DHR) to $305 while keeping an Overweight rating on the shares. The analyst believes that the life-sciences group can see a decline as risks related to foreign exchange still remain.
Weitz Investment Management mentioned Danaher Corporation (NYSE:DHR) in its Q2 2022 investor letter. Here is what the firm has to say:
Consistent with that approach, portfolio activity among our long holdings tilted toward purchases. We added to almost half our holdings by varying degrees, and we were pleased to initiate new positions in Danaher (NYSE:DHR). Danaher is a provider of instruments and diagnostic tools to medical, life science, and other desirable end-markets worldwide. The business generate significant free cash flow, possess strong competitive positions, and have excellent management teams with demonstrated acquisition records.
At the end of quarter ending June 2022, Fisher Asset Management was the most bullish on Danaher Corporation (NYSE:DHR), with a holding of 3,839,035 shares. As per Insider’s Monkey database, 82 hedge funds owned stakes in Danaher Corporation (NYSE:DHR) at the end of Q2 2022.
1. PG&E Corporation (NYSE:PCG)
Third Point Stake: $652,692,000
Percentage of Third Point’s Portfolio: 15.44%
Number of Hedge Fund Holders: 51
PG&E Corporation (NYSE:PCG) operates in the electricity and gas sector and is based in California. Dan Loeb sold some of its shares during Q2 2022. Third Point’s investment in the company constitutes 15.44% of the overall portfolio of the fund and held 65,400,000 shares of the company at the end of the second quarter of 2022.
On October 10, 2022, Shelby Tucker, an analyst at RBC Capital, increased his price target on PG&E Corporation (NYSE:PCG) to $19 as he kept Outperform rating on the stock. As per the analyst, there are significant upside drivers in place that will ensure the re-rating of the share price.
Here is what GoodHaven Capital Management said about PG&E Corporation (NYSE:PCG) in its Q2 2022 investor letter:
Other activity in the period included eliminating our holding in PG&E Corporation (NYSE:PCG) and adding a few new holdings – the luxury furniture and lifestyle company RH (formerly Restoration Hardware) and Goldman Sachs. A few important developments changed at PG&E including higher future capex plans and changes in long-term guidance, and so we changed our mind and sold. Purchases were made on a handful of occasions in 2020 and mid-2021 at an approximate average price of $9.20 and fully sold during February 2022 at an approximate average price of $11.42, earning approximately 24%.
You can also take a look at 10 Dividend Stocks That Are Too Cheap To Ignore and Hedge Fund Investor Letters Q3 2022.
