In this piece, we will take a look at the 5 retail stocks to buy according to Greg Poole’s Echo Street Capital. For more stocks and details about the hedge fund and its founder, head on over to 10 Retail Stocks to Buy According to Greg Poole’s Echo Street Capital.
5. Central Garden & Pet Company (NASDAQ:CENT)
Echo Street Capital’s Stake Value: $7.7 million
Percentage of Echo Street Capital’s 13F Portfolio: 0.05%
Number of Hedge Fund Holders: 18
Central Garden & Pet Company (NASDAQ:CENT) is a lawn, garden, and pet supplies retailer headquartered in Walnut Creek, California, United States. The company has several product brands such as Aqueon, Zilla, Bell Nursery, and Four Paws.
Central Garden & Pet Company (NASDAQ:CENT) raked in $739 million revenue and -$0.06 GAAP EPS in its fiscal Q4, beating analyst estimates for both. Argus downgraded the stock to Hold from Buy in November 2021, stating that supply chain disruption and delay in automation will negate the effects of the growth in pet ownership in the wake of the ongoing pandemic.
Mr. Poole’s hedge fund owned 181,182 Central Garden & Pet Company (NASDAQ:CENT) shares during Q3 2021, allowing it to have a $7.7 million stake in the company that represented 0.05% of its portfolio. During the same time period, 18 of the 867 hedge funds polled by Insider Monkey owned the company’s shares.
Central Garden & Pet Company (NASDAQ:CENT)’s largest investor is Steven Boyd’s Armistice Capital who owns 956,000 shares worth $41 million.
4. Amazon.com, Inc. (NASDAQ:AMZN)
Echo Street Capital’s Stake Value: $91 million
Percentage of Echo Street Capital’s 13F Portfolio: 0.64%
Number of Hedge Fund Holders: 243
Amazon.com, Inc. (NASDAQ:AMZN) is the world’s largest and most renowned electronic commerce retailer that connects global suppliers and merchants to customers in a host of countries. It also provides services in cloud computing and designs data center processors.
Echo Street Capital held 27,928 Amazon.com, Inc. (NASDAQ:AMZN) shares during Q3 2021 which were worth $91 million and represented 0.64% of its portfolio. During the same time period, 243 of 867 hedge funds polled by Insider Monkey had held a stake in the company.
Ken Fisher’s Fisher Asset Management is Amazon.com, Inc. (NASDAQ:AMZN)’s largest investor according to Insider Monkey’s research through a $6.3 billion stake via 1.9 million shares.
Polen Capital mentioned Amazon.com, Inc. (NASDAQ:AMZN) in its Q3 2021 investor letter. It stated that:
“Amazon has also lagged as its revenue growth is slowing on the very difficult comparisons from last year when this behemoth was growing revenue by over 40%. We still expect exceptional long-term growth and significant margin expansion as the fastest growing (and now large) segments of Amazon are also generating the highest margins.”
3. Copart, Inc. (NASDAQ:CPRT)
Echo Street Capital’s Stake Value: $112.7 million
Percentage of Echo Street Capital’s 13F Portfolio: 0.79%
Number of Hedge Fund Holders: 42
Copart, Inc. (NASDAQ:CPRT) is an online vehicle auction services platform that is headquartered in the United States and serves customers in the country and all over the globe. Its online platform allows banks, insurance companies, sellers, dealers, and individuals to connect with each other.
For its fiscal Q3, Copart, Inc. (NASDAQ:CPRT) brought in $810 million in revenue and $1.07 in non-GAAP EPS, beating analyst estimates for both. Truist raised the company’s price target to $175 from $160 in November 2021, believing that a strong market position combined with low costs and low leverage implies strong future growth.
As Q3 2021 ended, Echo Street owned 812,881 Copart, Inc. (NASDAQ:CPRT) shares in a $112 million stake which represented 0.79% of its portfolio. An Insider Monkey Q3 2021 study of 867 hedge funds outlined that 42 owned the company’s shares.
Copart, Inc. (NASDAQ:CPRT)’s largest investor is Kevin Oram and Peter Uddo’s Praesidium Investment Management Company. It owns 978,046 shares worth $135 million.
Merion Road Capital Management mentioned Copart, Inc. (NASDAQ:CPRT) in its Q2 2021 investor letter, outlining that:
“Many of our companies reported very strong earnings back in April. The market shrugged these off as it pondered how much growth would be sustainable, are inflationary trends transitory, and when interest rates will rise. While a slow-down in the broader economic recovery would hurt our portfolio, I remain positive on our position’s market positioning and longer term trends.
For instance, Copart reported 33% YoY revenue growth with EBIT margins expanding to 45%, an all-time high. While the company benefitted from inflation (an interesting hedge the market largely ignored earlier in the year), sustainable increases in ASPs and service offerings bode well for revenue per vehicle growth. Management noted that traffic is still down 20% or more as non-US markets are several months behind the United States on reopening and vaccinations. This volume boost should provide good tailwinds in the coming months.”
2. MercadoLibre, Inc. (NASDAQ:MELI)
Echo Street Capital’s Stake Value: $115 million
Percentage of Echo Street Capital’s 13F Portfolio: 0.8%
Number of Hedge Fund Holders: 68
MercadoLibre, Inc. (NASDAQ:MELI) is a Latin American electronic commerce platform provider. The company allows merchants and sellers to list and sell their products online.
Mr. Poole’s hedge fund owned 68,563 MercadoLibre, Inc. (NASDAQ:MELI) shares during the third quarter of last year. These were worth $115 million and represented 0.8% of the fund’s portfolio. During the same time period, 68 of the 867 hedge funds polled by Insider Monkey also owned the company’s shares.
MercadoLibre, Inc. (NASDAQ:MELI) brought in $1.86 billion through revenue and $1.92 through GAAP EPS in its fiscal Q3, beating analyst estimates for revenue only. Its price target was raised to $2,200 from $2,100 by Barclays in November 2021, who shared that the company has an attractive value proposition and services.
MercadoLibre, Inc. (NASDAQ:MELI)’s largest investor is Panayotis Takis Sparaggis’ Alkeon Capital Management who owns 445,136 shares worth $747 million.
LRT Capital Management mentioned the company in its Q3 2021 investor letter. It commented that:
“Mercadolibre, Inc. (MELI) – the LatAm eCommerce, shipping, and payments company, is now trading at a very attractive valuation – its lowest P/S ratio ever. The concerns here have to do with the recession in Brazil and slowing economic growth throughout the region.”
1. CoStar Group, Inc. (NASDAQ:CSGP)
Echo Street Capital’s Stake Value: $121.7 million
Percentage of Echo Street Capital’s 13F Portfolio: 0.85%
Number of Hedge Fund Holders: 29
CoStar Group, Inc. (NASDAQ:CSGP) is an online marketplace for real estate, hospitality, and other similar sectors. This platform allows its users access to an inventory of properties, alongside other services.
As its fiscal third quarter came to an end, CoStar Group, Inc. (NASDAQ:CSGP) reported that it had earned $499 million in revenue and $0.25 in non-GAAP EPS. This pleased Wall Street by beating estimates for both. Truist raised its price target to $110 from $98 in October 2021, believing that the company is only facing temporary headwinds.
Echo Street Capital owned 1.4 million CoStar Group, Inc. (NASDAQ:CSGP) shares during Q3 2021 which were worth $121.7 million and represented 0.85% of its portfolio. During the same time period, 29 of the 867 hedge funds part of Insider Monkey’s survey owned the company’s shares.
Charles Akre’s Akre Capital Management is CoStar Group, Inc. (NASDAQ:CSGP)’s largest investor through an $840 million stake via 9.7 million shares.
Harding Loevner mentioned the company in its Q3 2021 investor letter which stated that:
“A new holding is US-based CoStar, the dominant player in information services for the commercial real estate industry and online classified ads for commercial property. Its data and analytics business, which has over 90% market share in the US, mines a proprietary database of commercial real estate that spans office, industrial, retail, multi-family, and land. Its online marketplace business, with over 50% market share, owns valuable websites including Apartments.com for apartment listings and LoopNet for business property listings. Over 80% of its revenue is recurring, as its offerings are typically integrated with the workflow of its customers: brokers, owners, developers, and property managers.”
Disclosure: None. You can also take a peek at the 10 High Dividend Stocks to Buy According to Billionaire Lee Cooperman and 10 Best High Dividend Stocks in Canada for 2022.
