In this article, we discuss the 10 stocks to buy according to Bluegrass Capital Partners based on Q2 holdings of the fund.
Joseph Cornell has been the CIO at Bluegrass Capital Partners since 2016. He graduated from Cornell University with a Bachelor’s degree in Mathematics and Finance with honors and acquired his MBA degree from Harvard Business School. Before joining Bluegrass Capital Partners, he was the Managing Director at Chilton Investment Company.
Some of the top holdings in the investment portfolio of Bluegrass Capital Partners at the end of the second quarter of 2021 were Microsoft Corporation (NASDAQ:MSFT), Mastercard Incorporated (NYSE:MA), and Moody’s Corporation (NYSE:MCO), among others.
In Microsoft Corporation (NASDAQ:MSFT), Bluegrass Capital Partners owns 51,000 shares. The stock has gained 39.86% over the past 12 months.
Based on the latest 13F holdings for the second quarter of 2021, Bluegrass Capital Partners owns 40,000 shares in Mastercard Incorporated (NYSE:MA) after increasing its holding by 15% from the first quarter of 2021.
Photo by Behnam Norouzi on Unsplash
Another notable stock in Bluegrass Capital Partners’ portfolio is Moody’s Corporation (NYSE:MCO). The hedge fund owns an $8.62 million stake in the company. Moody’s Corporation (NYSE:MCO) has been up 23.98% over the last 12 months.
Here is a list of 10 stocks to buy according to Bluegrass Capital Partners in 2021. We used Bluegrass Capital Partners’ 13F portfolio for Q2 2021 for this analysis.
Stocks to Buy According to Bluegrass Capital Partners
10. The Sherwin-Williams Company (NYSE:SHW)
Bluegrass Capital Partners’ Stake Value: $10,626,000
Percentage of Bluegrass Capital Partners’ 13F Portfolio: 6.04%
Number of Hedge Fund Holders: 49
The Sherwin-Williams Company (NYSE:SHW) is a manufacturing company in Cleveland, Ohio. It is placed tenth on the list of 10 stocks to buy according to Bluegrass Capital Partners.
On September 30, BMO Capital analyst John McNulty lowered his price target to $300 from $307 but kept an “Outperform” rating on The Sherwin-Williams Company (NYSE:SHW) stock.
Bluegrass Capital Partners holds 39,000 shares in The Sherwin-Williams Company (NYSE:SHW) worth $10.63 million. The hedge fund’s stake in The Sherwin-Williams Company (NYSE:SHW) stock increased by 200% in the second quarter of 2021.
Alongside Microsoft Corporation (NASDAQ:MSFT), Mastercard Incorporated (NYSE:MA), and Moody’s Corporation (NYSE:MCO), The Sherwin-Williams Company (NYSE:SHW) is one of the stocks to buy according to Bluegrass Capital Partners.
9. Liberty Broadband Corporation (NASDAQ:LBRDA)
Bluegrass Capital Partners’ Stake Value: $10,941,000
Percentage of Bluegrass Capital Partners’ 13F Portfolio: 6.22%
Number of Hedge Fund Holders: 28
Liberty Broadband Corporation (NASDAQ:LBRDA) is placed ninth on the list of 10 stocks to buy according to Bluegrass Capital Partners. Liberty Broadband Corporation (NASDAQ:LBRDA) is a cable operator in the United States that offers Internet, television, and voice services to residential and small and medium business clients.
Bluegrass Capital Partners holds 63,000 shares in Liberty Broadband Corporation (NASDAQ:LBRDA) worth over $10.94 million, representing 6.22% of its portfolio.
Alphyn Capital Management, in its first-quarter 2021 investor letter, mentioned Liberty Broadband Corporation (NASDAQ:LBRDA). Here is what the fund said:
“Liberty Broadband completed its merger with GCI, thereby collapsing one layer of the double discount to Charter Communications, presenting a good opportunity to trim that position as well.”
8. Ball Corporation (NYSE:BLL)
Bluegrass Capital Partners’ Stake Value: $11,748,000
Percentage of Bluegrass Capital Partners’ 13F Portfolio: 6.67%
Number of Hedge Fund Holders: 44
Ball Corporation (NYSE:BLL) manufactures aluminum packaging for beverage, personal care, and home goods sectors in the United States, Brazil, and worldwide.
Bluegrass Capital Partners holds 145,000 shares in Ball Corporation (NYSE:BLL) worth over $11.75 million. The hedge fund’s stake in Ball Corporation (NYSE:BLL) stock increased by 65% in the second quarter of 2021. Hedge fund sentiment increased for Ball Corporation (NYSE:BLL) in the second quarter. Insider Monkey’s data shows that 44 elite hedge funds held stakes in the company at the end of the second quarter, up from 38 funds a quarter earlier.
In addition to Microsoft Corporation (NASDAQ:MSFT), Mastercard Incorporated (NYSE:MA), and Moody’s Corporation (NYSE:MCO), Ball Corporation (NYSE:BLL) is one of the stocks to buy according to Bluegrass Capital Partners.
In its first-quarter 2021 investor letter, ClearBridge Investments mentioned Ball Corporation (NYSE:BLL). Here is what the fund said:
“Aluminum beverage and food container manufacturer Ball Corp, meanwhile, delivered fourth-quarter operating income slightly lower than consensus, though this was mainly attributable to higher startup costs for large new facilities coming online in North America. These investments and additional capacity projects will contribute to strong volume growth globally, however. Aluminum cans are infinitely recyclable and offer the best replacement product for single-use plastic beverage containers, in our view. They are more likely to be recycled than single-use plastic and are more energy efficient in production as well.”
7. Dun & Bradstreet Holdings, Inc. (NYSE:DNB)
Bluegrass Capital Partners’ Stake Value: $11,754,000
Percentage of Bluegrass Capital Partners’ 13F Portfolio: 6.68%
Number of Hedge Fund Holders: 45
Dun & Bradstreet Holdings, Inc. (NYSE:DNB) is placed seventh on the list of 10 stocks to buy according to Bluegrass Capital Partners. It offers organizations with commercial data, analytics, and insights.
On September 29, Citi analyst Peter Christiansen lowered his price target on Dun & Bradstreet Holdings, Inc. (NYSE:DNB) to $21 from $28 and maintained a “Neutral” rating on the shares.
Weitz Investment Management, in its second-quarter 2021 investor letter, mentioned Dun & Bradstreet Holdings, Inc. (NYSE:DNB). Here is what the fund said about Dun & Bradstreet Holdings:
“Our two portfolio additions in the quarter, (which includes) Dun & Bradstreet, are strong examples of our QuaD approach in action. Dun & Bradstreet collects and provides proprietary data used by businesses to understand the credit risk of their counterparties, a service somewhat analogous to the more familiar credit scores for consumers. Prior management rested upon the laurels of this essential service, and necessary reinvestment was neglected until the business was ultimately sold in 2019. Under new management, led by Chairman Bill Foley and CEO Anthony Jabbour, Dun & Bradstreet has moved quickly to modernize its technology, improve its sales and contracting practices, invest in new data and capabilities that enhance its value to customers, and evaluate potential acquisitions that can boost each of these efforts. Our positive experience with Black Knight (Foley and Jabbour are Chairman Emeritus and CEO, respectively) bolsters our confidence in the efficacy of these efforts, despite the market adopting a “wait and see” approach.”
6. Kansas City Southern (NYSE:KSU)
Bluegrass Capital Partners’ Stake Value: $12,752,000
Percentage of Bluegrass Capital Partners’ 13F Portfolio: 7.24%
Number of Hedge Fund Holders: 61
Kansas City Southern (NYSE:KSU) is a transportation holding company. On September 15, Canadian Pacific Railway Limited (NYSE:CP) and Kansas City Southern (NYSE:KSU) announced a partnership where CP would acquire KCS in a stock and cash transaction valued at approximately $31 billion.
According to the latest filings, Bluegrass Capital Partners owned 45,000 shares in Kansas City Southern (NYSE:KSU) at the end of the second quarter of 2021 worth $12.75 million, representing 7.24% of the portfolio. The hedge fund increased its stake in the firm by 13% in the second quarter. Matthew Halbower’s Pentwater Capital Management is a leading shareholder in Kansas City Southern (NYSE:KSU), with 2.07 million shares worth more than $585.17 million.
In its first-quarter 2021 investor letter, Miller/Howard Investments mentioned Kansas City Southern (NYSE:KSU). Here is what the fund said:
“Canadian Pacific Railway (CP) agreed to acquire Kansas City Southern (KSU) in the largest rail deal in over a decade. The merger will create the first rail network connecting Canada, the US, and Mexico, and it should benefit from the passage of the USMCA Trade Agreement. We initiated a position in KSU in Q4 as we expected it to benefit from growing North American trade and viewed it as a consolidation candidate.”
5. Black Knight, Inc. (NYSE:BKI)
Bluegrass Capital Partners’ Stake Value: $12,867,000
Percentage of Bluegrass Capital Partners’ 13F Portfolio: 7.31%
Number of Hedge Fund Holders: 33
Black Knight, Inc. (NYSE:BKI) provides integrated software, data, and analytics solutions.
On September 30, Raymond James analyst Patrick O’Shaughnessy upgraded Black Knight, Inc. (NYSE:BKI) to “Outperform” from “Market Perform” and gave a price target of $83.
There were 33 hedge funds in our database that held stakes in Black Knight, Inc. (NYSE:BKI) at the end of the second quarter of 2021, compared to 40 funds in the previous quarter.
4. Microsoft Corporation (NASDAQ:MSFT)
Bluegrass Capital Partners’ Stake Value: $13,816,000
Percentage of Bluegrass Capital Partners’ 13F Portfolio: 7.85%
Number of Hedge Fund Holders: 238
On September 17, Tigress Financial analyst Ivan Feinseth initiated coverage of Microsoft Corporation (NASDAQ:MSFT) and increased his price target to $366 from $303 and kept a “Buy” rating on the shares.
Out of the hedge funds being tracked by Insider Monkey, Ivy Lane Capital is a leading shareholder in Microsoft Corporation (NASDAQ:MSFT) with 86,000 shares worth more than $23.30 billion. Bluegrass Capital Partners owns 51,000 shares in the tech company worth over $13.82 million, representing close to 7.85% of its portfolio.
In its second-quarter 2021 investor letter, Baron Opportunity Fund mentioned Microsoft Corporation (NASDAQ:MSFT). Here is what the fund said:
“Shares of Microsoft Corporation, a cloud-software leader and provider of software productivity tools and infrastructure, rose during the quarter following a strong earnings report highlighting solid demand for its broad product stack and continued momentum migrating its business to the cloud. Microsoft was a top contributor in the period because it trades at reasonable free cash flow and earnings valuations, has cloud and digital transformation tailwinds at its back, reported a solid March quarter, and beat Street expectations by a wide margin. Microsoft’s results continued to be strong across the board, with Azure cloud computing revenues up 46% in constantcurrency (“cc”) terms and commercial cloud bookings growth of 38% cc, the best in years. Microsoft also reported robust profitability growth, with operating income expanding 31% and GAAP earnings up 45%. We believe the company is well positioned for continued solid growth and profitability through market share gains as more companies look to transform and digitize their businesses as they move operations to the cloud.”
3. TransDigm Group Incorporated (NYSE:TDG)
Bluegrass Capital Partners’ Stake Value: $14,240,000
Percentage of Bluegrass Capital Partners’ 13F Portfolio: 8.09%
Number of Hedge Fund Holders: 57
TransDigm Group Incorporated (NYSE:TDG) designs, manufactures, and markets airplane components. It ranks third on the list of 10 stocks to buy according to Bluegrass Capital Partners.
On September 13, Morgan Stanley analyst Kristine Liwag initiated coverage of TransDigm Group Incorporated (NYSE:TDG), rating the stock as “Buy,” with a price target of $762.
Bluegrass Capital Partners holds 22,000 shares in TransDigm Group Incorporated (NYSE:TDG) worth over $14.24 million, representing 8.09% of its investment portfolio. The hedge fund has increased its stake in TransDigm Group by 5% in the second quarter.
In its second-quarter 2021 investor letter, Vulcan Value Partners, an investment management firm, mentioned TransDigm Group Incorporated (NYSE:TDG). Here is what the fund said:
“TransDigm Group Inc., another material contributor during the quarter, is an aerospace manufacturer providing highly engineered, niche components for use on commercial and military aircraft. The vast majority of the company’s profits come from aftermarket sales. Its business was impacted by the global pandemic; however, the company has been able to maintain margins despite strong revenue headwinds, and it continues to generate strong free cash flow.”
2. Mastercard Incorporated (NYSE:MA)
Bluegrass Capital Partners’ Stake Value: $14,604,000
Percentage of Bluegrass Capital Partners’ 13F Portfolio: 8.3%
Number of Hedge Fund Holders: 156
Based on Bluegrass Capital Partners’ SEC 13F filings at the end of the second quarter, it currently owns 40,000 shares of Mastercard Incorporated (NYSE:MA) worth $14.60 million, accounting for 8.3% of the hedge fund’s total portfolio. Moreover, hedge funds are loading up on Mastercard Incorporated (NYSE:MA), as Insider Monkey’s data shows that 156 hedge funds held a stake in the company in the second quarter of 2021, compared to 151 funds in the preceding quarter.
Qualivian Investment Partners, its second-quarter 2021 investor letter, mentioned Mastercard Incorporated (NYSE:MA). Here is what Qualivian Investment Partners has to say about Mastercard Incorporated:
“Mastercard: Q2 revenue and EPS beat consensus estimates by 3.7% and 12% respectively. Operating margins also beat consensus by +240 bps. Gross domestic volume growth of +38.3% (+32.8% in constant currency) was buttressed by continued e-commerce strength and better in-store performance, while purchase volumes grew 41.8% (35.5% in constant currency). Cross border performance was strong, but durability remains uncertain given uncertainty arising from the Delta variant and its impact on travel and tourism. We believe Mastercard has a robust runway for growth given further travel recovery, new/existing partnerships, traction in digital payments, and ongoing economic recovery.”
1. NeoGames S.A. (NASDAQ:NGMS)
Bluegrass Capital Partners’ Stake Value: $17,519,000
Percentage of Bluegrass Capital Partners’ 13F Portfolio: 9.96%
Number of Hedge Fund Holders: 11
NeoGames S.A. (NASDAQ:NGMS) is a global provider of iLottery technology solutions. It is placed first on the list of 10 stocks to buy according to Bluegrass Capital Partners.
In the second quarter, NeoGames S.A.’s (NASDAQ:NGMS) earnings per share was $0.10, below the estimates by $0.02. Network NGR over the period was $187 million, compared to $112 million for the second quarter of 2020, signifying an increase of 67.2% year-over-year.
Richard Driehaus’ Driehaus Capital is the leading shareholder of NeoGames S.A. (NASDAQ:NGMS) with 365,310 shares worth $22.46 million. Bluegrass Capital Partners owns more than 285,000 shares in NeoGames S.A. (NASDAQ:NGMS) worth $17.52 million, representing 9.96% of its portfolio. At the end of the second quarter of 2021, 11 hedge funds in the database of Insider Monkey held stakes worth $63.23 million in NeoGames S.A. (NASDAQ:NGMS), up from 9 the preceding quarter worth $52.95 million.
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Disclosure: None. 10 Stocks to Buy According to Bluegrass Capital Partners is originally published on Insider Monkey.
