In this article, we will list Billionaire Stan Druckenmiller’s 5 small and mid-cap stock picks with huge upside potential. Please visit Billionaire Stan Druckenmiller’s 10 Small and Mid-Cap Stock Picks with Huge Upside Potential, if you would like to see the extended list and the methodology behind it.
Stan Druckenmiller
5. NewAmsterdam Pharma Company N.V. (NASDAQ:NAMS)
Duquesne Capital’s Stake: $108 Million
NewAmsterdam Pharma Company N.V. (NASDAQ:NAMS) is a relatively recent addition to the 13F portfolio of Duquesne Capital. The fund first disclosed a stake in the company in the third quarter of 2024. This position comprised over 280,000 shares. In the coming quarters, the fund gradually built up this position. In the first quarter of 2025, it improved the position by 178%. In the second quarter of 2025, the holding was increased by another 4%. In the third quarter of 2025, share ownership rose to nearly 1.9 million, up 131% compared to filings for the previous quarter. Filings for the fourth quarter of 2025 show that the fund owned more than 3 million shares in the firm, up nearly 60% compared to filings for the previous quarter.
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In recent years, the smart money has positioned itself for a multi-billion dollar transformation of the cardiovascular and Alzheimer’s markets. NewAmsterdam Pharma Company N.V. (NASDAQ:NAMS) is at the core of this transformation. Hedge funds are betting on obicetrapib, NewAmsterdam’s oral, once-daily CETP inhibitor. Over 1 in 4 high-risk cardiovascular patients fail to reach their LDL-C goals even with high-intensity statins. In the Phase 3 BROADWAY and BROOKLYN trials, finalized in 2025, obicetrapib demonstrated statistically significant LDL-C lowering of roughly 40-50% as an adjunct to statins. Institutional investors view this as a best-in-class oral alternative to expensive, injectable PCSK9 inhibitors.
4. Woodward, Inc. (NASDAQ:WWD)
Duquesne Capital’s Stake: $179 Million
Woodward, Inc. (NASDAQ:WWD) has been a mainstay in the 13F portfolio of Duquesne Capital since many quarters. The fund first disclosed a stake in the company in the fourth quarter of 2023. This position comprised over 400,000 shares. In the following quarter, the fund upped this stake by over 130%, taking share ownership to 954,000 shares. Another 10% addition in the third quarter of 2024 increased this to over a million shares. After upping this position by 15% in the following quarter, the fund has trimmed the holding since then. Filings for the fourth quarter of 2025 show that the fund owned 590,000 shares in the firm, down 6% compared to filings for the third quarter of 2025.
The smart money is currently backing Woodward, Inc. (NASDAQ:WWD) due to its unique position at the intersection of a recovering aerospace market and a massive global shift in energy infrastructure. Hedge funds are particularly bullish on Woodward’s Aerospace segment, which saw a 29% revenue surge in Q1 2026. A 50% year-over-year increase in commercial services has caught the eye of institutional investors. As global airline fleets age and utilization remains at record highs, Woodward’s proprietary control systems require constant, high-margin maintenance and parts. Hedge funds view Woodward as a safe haven defense play. With defense OEM sales up 23% in early 2026, the company is benefiting from smart defense orders and increased global military spending.
3. Teva Pharmaceutical Industries Limited (NYSE:TEVA)
Duquesne Capital’s Stake: $183 Million
Teva Pharmaceutical Industries Limited (NYSE:TEVA) first appeared in the 13F portfolio of Duquesne Capital back in the fourth quarter of 2013. This position comprised over 1.2 million shares and was sold off by late 2014. A new position was opened in the stock in the third quarter of 2024. This holding consisted of 1.4 million shares. The fund increased this position to more than 16.5 million shares by the third quarter of 2025. Filings for the fourth quarter of 2025, however, show that the fund has trimmed this holding by over 64% and owns 5.8 million shares in the pharma company.
A primary driver of hedge fund interest in Teva Pharmaceutical Industries Limited (NYSE:TEVA) stock has been Teva’s shift from low-margin generics to high-margin branded drugs. For the first time, Teva’s innovative brands—AUSTEDO (tardive dyskinesia), AJOVY (migraine), and UZEDY (schizophrenia)—collectively delivered over $1 billion in a single quarter (Q4 2025). AUSTEDO is now projected to hit $2.5 billion in annual revenue by 2027, ahead of previous management schedules. Institutional investors are also rewarding Teva for its aggressive entry into the biosimilar market, which offers higher barriers to entry than traditional generics. In March 2026, Teva received FDA approval for PONLIMSI, a biosimilar for Prolia, and saw its filing for a Xolair biosimilar accepted. Analysts estimate the schizophrenia treatment Olanzapine LAI represents a $3 billion peak sales opportunity.
2. Insmed Incorporated (NASDAQ:INSM)
Duquesne Capital’s Stake: $258 Million
Insmed Incorporated (NASDAQ:INSM) first appeared in the 13F portfolio of Duquesne Capital back in the second quarter of 2020. This position comprised 1.2 million shares and was sold off by the next quarter. A new position was opened in the stock in the second quarter of 2024. This holding consisted of just 20,000 shares. However, the fund upped this to over 2.4 million shares by the third quarter of 2025. Filings for the fourth quarter of 2025 reveal that the fund owned nearly 1.5 million shares in the firm, down 38% compared to the previous quarter.
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Hedge fund interest in Insmed Incorporated (NASDAQ:INSM) stock is primarily due to the successful transitioning of the firm from a clinical-stage biotech into a commercial powerhouse with a dominant lead in rare lung diseases. The commercial performance of Brinsupri, the first-ever approved treatment for non-cystic fibrosis bronchiectasis, is the most important. In its first full quarter of launch (Q4 2025), Brinsupri generated $144.6 million, shattering analyst expectations. CEO Will Lewis noted that Insmed essentially owns this entire disease category with no immediate competition. Hedge funds are pricing in peak sales of $5 billion+, with 2026 guidance already set at a minimum of $1 billion.
1. Natera, Inc. (NASDAQ:NTRA)
Duquesne Capital’s Stake: $575 Million
Natera, Inc. (NASDAQ:NTRA) is the largest holding in the 13F portfolio of Duquesne Capital. The stock has consistently appeared in the portfolio of the fund since the third quarter of 2022. Back then, this position comprised just over 400,000 shares. The fund steadily increased this to over 3.5 million shares by the end of the fourth quarter of 2024. Since then, the stake has been trimmed. Filings for the fourth quarter of 2025 show that the fund owned 2.5 million shares in the firm, down over 21% compared to filings for the previous quarter.
A major catalyst for Wall Street interest in Natera, Inc. (NASDAQ:NTRA) is the explosive growth of Signatera, Natera’s molecular residual disease (MRD) test. In early 2026, data showed that over 50% of all oncologists in the US had ordered a Signatera test in the previous quarter. Oncology test volumes grew by 55% year-over-year in Q4 2025. Institutional investors are betting that as Signatera becomes integrated into clinical guidelines for more cancer types, like breast and colorectal, the volume will become a massive, recurring revenue stream. Hedge funds have historically been wary of Natera’s high cash burn, but the narrative shifted in early 2026. Natera achieved a major goal in 2025 by generating $107.6 million in positive cash inflow. This removed the dilution risk that often plagues high-growth biotech stocks.
While we acknowledge the potential of NTRA to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than NTRA and that has 100x upside potential, check out our report about the cheapest AI stock.
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