Billionaire Louis Bacon’s 5 Stock Picks with Huge Upside Potential

In this article, we discuss billionaire Louis Bacon’s 5 stock picks with huge upside potential. To read the details about Mr. Bacon’s life, portfolio performance, and investment strategy, go directly to Billionaire Louis Bacon’s 10 Stock Picks with Huge Upside Potential.

5. Luminar Technologies, Inc. (NASDAQ:LAZR)

Louis Bacon’s Stake Value: $35.667 million

Average analyst price target: $7.57

Average analyst price target upside: 198.03%

Luminar Technologies, Inc. (NASDAQ:LAZR) is a Florida-based company that develops and sells proactive safety and autonomy software solutions, sensors, and consulting services.

On November 10, Luminar Technologies, Inc. (NASDAQ:LAZR) announced that its iconic next-generation LiDAR technology will be part of Polestar Automotive Holding UK PLC (NASDAQ:PSNY)’s Polestar 4. The agreement also involves Intel Corporation (NASDAQ:INTC) and is expected to strengthen the existing partnership between the three corporations.

On November 8, Luminar Technologies, Inc. (NASDAQ:LAZR) reported its Q3 earnings result with a non-GAAP loss per share of $0.21 and revenue of $16.96 million, which grew 32.7% year-over-year (YoY).

Luminar Technologies, Inc. (NASDAQ:LAZR) was covered by 7 Wall Street analysts, and 5 keep a Buy rating on the shares. The average price target of $7.57 has an upside of 198.03%.

4. Teck Resources Limited (NYSE:TECK)

Louis Bacon’s Stake Value: $71.455 million

Average analyst price target: $47.85

Average analyst price target upside: 27.87%

Teck Resources Limited (NYSE:TECK) is a Canadian mining company with diversified operations in mining and mineral development.

On November 20, Teck Resources Limited (NYSE:TECK) announced that it has received regulatory approval from the Toronto Stock Exchange to purchase up to 40 million class B Shares between November 22, 2023, and November 21, 2024.

On November 16, Teck Resources Limited (NYSE:TECK) announced a quarterly dividend of CAD 0.125, payable by December 29 to the shareholders of record on December 15. The dividend yield of the company was 0.98% as of the December 4 market close.

On November 14, Glencore plc (OTC:GLNCY) confirmed that it would purchase a 77% stake in Teck Resources Limited (NYSE:TECK)’s coal business for $6.9 billion in cash. CEO of Teck Resources Limited (NYSE:TECK), Jonathan Price, commented that the company will receive $8.6 billion in cash after the sale, which would go a long way in paying down debt, expanding its base metals production, and returning cash to the shareholders.

3. CRH plc (NYSE:CRH)

Louis Bacon’s Stake Value: $73.99 million

Average analyst price target: $74.56

Average analyst price target upside: 18.43%

CRH plc (NYSE:CRH) is an Ireland-based company that is involved in the production and distribution of construction materials.

On November 22, CRH plc (NYSE:CRH) announced that it reached an agreement with SigmaRoc to divest its lime operations in Europe for a consideration of $1.1 billion. The three phases of the transaction are expected to be completed in 2024.

On November 21, CRH plc (NYSE:CRH) announced that it would acquire a portfolio of cement and ready mixed concrete assets in Texas from Martin Marietta Materials, Inc. (NYSE:MLM).  The purchase consideration is $2.1 billion and is expected to be completed in the first half of 2024.

Voss Capital commented on CRH plc (NYSE:CRH) in its third quarter 2023 investor letter. Here is what it said:

“While the market has recently been focused on GPU chips and AI scripts, our attention has been on cement blocks and crushed rocks. We’ve enthusiastically made CRH one of our largest positions ever at cost due to its limited downside. CRH is among the largest aggregates and infrastructure companies in the United States and Europe and has recently relisted to the NYSE from the LSE, which we believe will be a catalyst for the stock to rerate upwards towards peer valuations as its undeniable value hiding in plain sight becomes more widely discussed.

In 1970, Cement Limited and Roadstone Limited, two Irish infrastructure-focused companies, combined to form Cement and Roadstone Holdings, or “CRH.” An investment of $1 million into CRH upon its founding since that fateful merger ~53 years ago would have turned into ~$1.5 billion by mid-year 2023, an annualized total return to investors of 15.0%, a high rate of compounding we think can continue.

Half a century of success at CRH has been driven by disciplined operations and capital allocation that we believe derives from a company culture built around appropriate financial incentives. CRH’s M&A playbook has proven to be successful as an acquisitive company like CRH can’t compound at a rate of 15% over 50 years unless acquisitions and divestitures have been executed at attractive prices. Over the last five years, CRH has spent $10.3 billion on acquisitions while receiving $10.5 billion in proceeds from divestitures across dozens of transactions, with the average acquisition multiple ranging from 7x – 8x EBITDA depending on the year and the average exit multiple clocking in at 11x EBITDA.”

2. Meta Platforms, Inc. (NASDAQ:META)

Louis Bacon’s Stake Value: $271.693 million

Average analyst price target: $387.71

Average analyst price target upside: 21.15%

Meta Platforms, Inc. (NASDAQ:META) is a leading tech conglomerate that provides social networking platforms, advertising services, and business insight solutions.

Over the last three months, Meta Platforms, Inc. (NASDAQ:META)’s stock was covered by 38 Wall Street analysts, and 37 maintained a Buy rating on the shares. The average price target of $387.71 represents an upside of 21.15% as of the December 4 market close.

On November 22, Tigress Financial increased the price target on Meta Platforms, Inc. (NASDAQ:META)’s stock to $435 from $380 and maintained a Strong Buy rating. According to the analyst, the company is well positioned because of its strong presence in the digital advertising sphere, continuous innovation, new products, and AI integration.

Artisan Partners commented on Meta Platforms, Inc. (NASDAQ:META) in its third quarter 2023 investor letter. Here is what it said:

“Meta Platforms, Inc. (NASDAQ:META) added to its string of gains in Q3. The share price is up about 150% this year. Second quarter results were very good: revenue growth is back to double digits, user metrics are solid and show very good engagement, daily active users grew 7%, and importantly, Facebook app users continue to grow across all geographies. Instagram is growing more strongly, but solid growth in the legacy Facebook business is a positive indicator. Importantly, the company has controlled expenses tightly. Headcount was down 14% year over year. Adjusted EBIT grew 44%, and the margin recovered strongly to 38%, from 29% last year.”

1. NVIDIA Corporation (NASDAQ:NVDA)

Louis Bacon’s Stake Value: $384.312 million

Average analyst price target: $661.00

Average analyst price target upside: 45.24%

NVIDIA Corporation (NASDAQ:NVDA) is a California-based tech company that is engaged in the production and distribution of graphics processing units, central processing units, and system-on-a-chip units.

Out of the 910 hedge funds tracked by Insider Monkey, 180 funds had investments in NVIDIA Corporation (NASDAQ:NVDA)’s stock in the third quarter, up from 175 in the previous quarter. Rajiv Jain’s GQG Partners was the biggest shareholder of the company, with 14.039 million shares worth over $6.1 billion, representing 14.13% of the fund’s portfolio.

On November 21, NVIDIA Corporation (NASDAQ:NVDA) posted Q3 non-GAAP EPS of $4.02, topping the estimates by $0.63. The revenue increased by 205.6% YoY to $18.12 billion, which beat the estimates by $2.01 billion.

NVIDIA Corporation (NASDAQ:NVDA) was mentioned in O’keefe Stevens Advisory’s third-quarter 2023 investor letter. Here is what it said:

“This quarter, we actively reduced our position in our favorite company, NVIDIA Corporation (NASDAQ:NVDA). Over the past several years, I have consistently noted the concentration of the top 5 holdings in our portfolio, with NVDA comprising 26% of the last quarter’s 40%. The business, management, and outlook are nothing short of excellent. The business has a dominant market share in a rapidly growing market with competition seemingly years behind, though, fighting hard to gain share. Gross margin is expected to exceed 70% in 2024 and expand in 2025, reflecting the premium customers pay for their advanced technology. Revenue growth of 30%+ on a $50B base and a return on equity over 50%. If this isn’t the best business in the world currently, certainly it is in the top 5.

Jensen is the reason we held onto the stock despite our unease about the valuation. Jensen came to the U.S. from Thailand and was sent to a boarding school in rural Kentucky for troubled youth by his aunt and uncle, who mistook it for a prep school. When buying an ownership stake in the business, we must ask ourselves who we partner with. Are they honest? Capable? Aligned?

Honest: Listening to Jensen (while promotional) is like a breadth of fresh air. He tells you how it is. When the business looked like it was headed for failure in 2009, Jensen reduced his salary to $1….” (Click here to read the full text)

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