In this article, we will take a look at hedge fund billionaire Mr. Paul Singer’s top ten favorite stocks to buy.
Paul Singer is behind one of the oldest American investment management firms and one of the largest activist investors in the world. In the financial sector, activist firms are those that seek to gain control over weak or struggling companies, with the hopes of turning their fortunes around. Mr. Singer’s investment management firm is called Elliott Management Corporation, and it manages a $12.9 billion portfolio as of the end of the second quarter. The firm was founded in 1977 by Mr. Singer himself and it has propelled its founder to the status of a billionaire, with Mr. Singer having a net worth of $4 billion.
Elliot Management Corporation’s investments are not limited to a specific sector of companies, as it chooses to invest in firms that operate in several different sectors. Some of the top holdings of the fund include Twitter, Inc (NYSE:TWTR), Dropbox, Inc (NASDAQ:DBX), Snap Inc (NYSE:SNAP) and Tesla, Inc (NASDAQ:TSLA).
Paul Singer of Elliott Management
We used Singer’s Q2 portfolio for this analysis.
Why should we pay attention to Paul Singer’s stock picks? Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 86 percentage points since March 2017. Between March 2017 and July 2021, our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY. Our stock picks outperformed the market by 86 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
Billionaire Paul Singer’s Top 10 Stock Picks
10. Uniti Group Inc. (NASDAQ:UNIT)
Paul Singer’s Stake Value: $216.8 million
Percentage of Paul Singer’s 13F Portfolio: 1.66%
Number of Hedge Fund Holders: 16
Uniti Group Inc. (NASDAQ:UNIT) is a real estate investment trust (REIT) that is involved in managing, acquiring and building communications infrastructure such as fiber optic cables. It is headquartered in Little Rock, Arkansas, United States. The company boasts of having more than 125,000 miles of fiber optic routes, connecting over a quarter of a million buildings and providing connections to 25,400 customers.
By the end of the second quarter of this year, Paul Singer’s Elliot Management Corporation held more than 20 million shares of Uniti Group Inc..
9. Peabody Energy Corporation (NYSE:BTU)
Paul Singer’s Stake Value: $229.3 million
Percentage of Paul Singer’s 13F Portfolio: 1.76%
Number of Hedge Fund Holders: 18
Peabody Energy Corporation (NYSE:BTU), headquartered in St. Louis, Missouri, United States is the largest coal provider in the world. It is also one of the oldest companies in the U.S., after being formed during the Gilded Era of the country’s history in 1883 in the city of Chicago.
By the end of the second quarter of this year, Paul Singer’s Elliot Management Capital held 28.9 million shares of the company. These shares are worth $229 million and they represent 1.76% of the investment firm’s overall portfolio. Furthermore, out of the 873 hedge funds polled by Insider Monkey by the end of the second quarter of this year, 18 held a stake in Peabody Energy Corporation.
8. E2open Parent Holdings, Inc. (NYSE:ETWO)
Paul Singer’s Stake Value: $319.5 million
Percentage of Paul Singer’s 13F Portfolio: 2.45%
Number of Hedge Fund Holders: 35
E2open Parent Holdings, Inc. (NYSE:ETWO) is headquartered in Austin, Texas and it is a provider of supply chain management software. It is known for providing its services to some of the largest companies in the world and the company’s offerings include supply chain software as software as a service (SaaS) solutions.
Like Dell Technologies Inc. (NYSE:DELL), Twitter, Inc and Howmet Aerospace Inc. (NYSE:HWM), E2open Parent Holdings, Inc. also makes its way into Paul Singer’s favorite stocks to own.
Elliot Management Capital held 27.9 million shares of E2open Parent Holdings, Inc. by the end of the second quarter with the stake being worth a cool $319 million and representing 2.45% of the investment firm’s portfolio. Out of the 873 hedge funds polled by Insider Monkey by the end of the second quarter, 35 held a stake in the company.
In his investor note initiating coverage of E2open Parent Holdings, Inc., Bank of America analyst Andrew Obin set a $14 price target believing that the ongoing supply chain crisis presents unique opportunities for the company.
7. Arconic Corporation (NYSE:ARNC)
Paul Singer’s Stake Value: $370.1 million
Percentage of Paul Singer’s 13F Portfolio: 2.84%
Number of Hedge Fund Holders: 30
Arconic Corporation (NYSE:ARNC) is a young American company that was founded in 2020 in Pittsburg, Pennsylvania. It deals with manufacturing and engineering lightweight metals with its products used across a diverse array of industries such as aerospace, transportation, construction and automotive.
Paul Singer’s Elliot Management Capital held 10.3 million shares of Arconic Corporation by the end of the second quarter, with the stake worth $370 million and representing 2.84% of the investment firm’s portfolio. Out of the 73 hedge funds polled by Insider Monkey during the same period, 30 held a stake in the company.
Arconic Corporation is one of Elliot Management’s favorite stocks, just like Dell Technologies Inc., Twitter, Inc and Howmet Aerospace Inc. and E2open Parent Holdings, Inc..
Investment bank Goldman Sachs initiated coverage for Arconic Corporation (NYSELARNC) in September and set a $34 price target for the company’s shares.
6. Nielsen Holdings plc (NYSE:NLSN)
Paul Singer’s Stake Value: $409.5 million
Percentage of Paul Singer’s 13F Portfolio: 3.16%
Number of Hedge Fund Holders: 28
Nielsen Holdings plc (NYSE:NLSN) is an analytics firm that is headquartered in New York City and is involved in the processing and analyzing data from several fronts including goods, consumer behavior and the media. Its largest segment is the media analytics division that determines which topics and programs are the hottest among consumers.
As of the second quarter, Elliot Management Capital held 16 million Nielsen Holdings plc (NYSE:NLSN) shares that were worth $409.5 million and represented 3.16% of the investment firm’s stocks. At the same time, 28 of the 873 hedge funds polled by Insider Monkey had a stake in the company.
Citi has a $21 price target for the firm after it was lowered due to troubles associated with the ongoing pandemic.
5. Evergy, Inc. (NYSE:EVRG)
Paul Singer’s Stake Value: $637 million
Percentage of Paul Singer’s 13F Portfolio: 4.91%
Number of Hedge Fund Holders: 21
Evergy, Inc. (NYSE:EVRG) is another old American company that was founded in 1909 and is headquartered in Kansas City, Missouri. It is an electricity provider that has a power generation capacity that spans into thousands of megawatts. Evergy, Inc.’s power generation portfolio includes all types of technologies including wind, nuclear and traditional means.
Paul Singer’s Elliot Management Capital holds 10.5 million shares of the company that are worth $637 million and represent 4.9% of the firm’s overall portfolio. Out of the 873 hedge funds polled by Insider Monkey by the second quarter, 21 held a stake in Evergy, Inc..
4. Marathon Petroleum Corporation (NYSE:MPC)
Paul Singer’s Stake Value: $638.6 million
Percentage of Paul Singer’s 13F Portfolio: 4.9%
Number of Hedge Fund Holders: 48
Marathon Petroleum Corporation (NYSE:MPC) is a young company headquartered in Findlay, Ohio. It is responsible for mining and selling petroleum products and the company of is also one of the largest petroleum companies in the United States.
By the end of the second quarter of this year, Paul Singer’s investment firm held 10.5 million shares of Marathon Petroleum Corporation that amount to a dollar value of $638.6 million and represented 4.9% of the firm’s holdings. During the same time period, 48 out of the 873 hedge funds polled by Insider Monkey held a stake in the oil company.
3. Twitter, Inc. (NYSE:TWTR)
Paul Singer’s Stake Value: $688 million
Percentage of Paul Singer’s 13F Portfolio: 5.29%
Number of Hedge Fund Holders: 89
Twitter, Inc. is a popular social media platform headquartered in the United States that allows its users to communicate with each other by sharing brief snippets of information and also by sharing videos and other content such as news items.
Paul Singer’s Elliot Management Capital held 10 million shares of the company by the end of the second in a stake worth a whopping $688 million that represented 5.29% of the investment firm’s holdings. During the same time period, out of the 873 hedge funds polled by Insider Monkey, 89 held a stake in Twitter, Inc..
In its second quarter investor letter, ClearBridge Investments had the following to say about the company:
“Not every portfolio company will neatly fit into one of these four growth segments and some may move from one to another over time. Social media platform Twitter could be considered an improving growth story due to the initiatives put in place to grow and better monetize its user base. With the global return of live events and sports causing a rebound in advertising, combined with other new services beginning to thrive, this is a company with the fundamentals to be categorized as a disruptor.”
2. Howmet Aerospace Inc. (NYSE:HWM)
Paul Singer’s Stake Value: $1.4 billion
Percentage of Paul Singer’s 13F Portfolio: 10.89%
Number of Hedge Fund Holders: 89
Howmet Aerospace Inc. is one of the oldest American companies out there since it was founded in 1888 and is headquartered in Pittsburg, Pennsylvania. It is responsible for manufacturing components for jet engines and other aerospace applications.
By the end of the second quarter, Elliot Management Capital held 41 million shares of Howmet Aerospace Inc. worth $1.4 billion and 10.89% of the firm’s portfolio value. 89 of the 873 hedge funds polled by Insider Monkey had a stake in the company during the same time.
In its fourth-quarter 2020 investor letter, investment firm FPA Crescent Fund had the following to say about Howmet Aerospace Inc.:
“Howmet saw its stock price decline by around two-thirds from their Q1 2020 highs. Howmet’s price increased about three times from its low and ended the year at its all-time high. The value of its necessary and large market share business did not fluctuate as much as its stock price.”
1. Dell Technologies Inc. (NYSE:DELL)
Paul Singer’s Stake Value: $2.48 billion
Percentage of Paul Singer’s 13F Portfolio: 19.04%
Number of Hedge Fund Holders: 62
Dell Technologies Inc. (DELL) is the iconic American consumer electronics firm that is associated with introducing customizable personal computers based on customer choice. Founded by the well known billionaire Michael Dell in 1984, it has grown to be one of the largest and most famous computer companies in the world.
By the end of the second quarter, Elliot Management Capital held 24.8 million Dell Technologies Inc. (DELL) shares that were worth $2.48 billion and made for 19.04% of the fund’s portfolio holdings. During the same time period, 62 of the 873 hedge funds polled by Insider Monkey held a stake in the company.
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This article is originally published at Insider Monkey.
