5 New Stock Picks of Billionaire Dan Loeb

3. Archaea Energy Inc. (NYSE:LFG)

Third Point’s Stake Value: $80,874,000

Percentage of Third Point’s 13F Portfolio: 0.44%

Number of Hedge Fund Holders: 25

Archaea Energy Inc. (NYSE:LFG) is a Pennsylvania-based renewable natural gas (RNG) company that develops RNG facilities to capture waste emissions and turn them into low carbon fuel. Billionaire Dan Loeb, via Third Point, acquired a position worth $80.8 million in Archaea Energy Inc. (NYSE:LFG) in the third quarter of 2021. The stock accounts for 0.44% of the fund’s Q3 investment portfolio. 

On January 27, Archaea Energy Inc. (NYSE:LFG) expanded its commercial partnership with FortisBC Energy, a subsidiary of Fortis Inc. (NYSE:FTS), by inking a new long-term RNG purchase and sale agreement. FortisBC will purchase up to 7.6 million MMBtu of RNG generated by Archaea Energy Inc. (NYSE:LFG) annually for a fixed fee for 20 years. The deal is expected to commence in 2022, with the full annual quantity starting in 2025.

Citi analyst Timm Schneider lowered the price target on Archaea Energy Inc. (NYSE:LFG) on January 18 to $29 from $31 and kept a Buy rating on the shares. The analyst now has a higher cost of capital assumption and is marking-to-market his forward multiples to current peer valuation ranges on the heels of the recent broader renewable and alternative energy market sell-off.

According to the Q3 database of Insider Monkey, 25 hedge funds were bullish on Archaea Energy Inc. (NYSE:LFG), with stakes equaling $317.7 million.