Billionaire Stanley Druckenmiller is Decreasing Stakes in These 10 Stocks

Published on September 5, 2022 at 9:06 am by Usman Kabir in Hedge Funds, News

In this article, we discuss the 10 stocks that billionaire Stanley Druckenmiller is decreasing stakes in. If you want to read about some more stocks in the Stanley Druckenmiller portfolio, go directly to Billionaire Stanley Druckenmiller is Decreasing Stakes in These 5 Stocks.

Stanley Druckenmiller of Duquesne Capital is famous on Wall Street since his hedge fund averaged annual returns of over 30% in a more than two-decade period between the late 1980s and early 2010s, dwarfing the returns of the benchmark indexes during the time. Druckenmiller converted his fund into a family office in 2010 and has continued to provide his select clients with remarkable returns. At the end of the second quarter of 2022, the value of the equity portfolio of the fund was in excess of $1.3 billion.

Latest filings show that between March 2022 and June 2022, the value of the equity portfolio decreased by around $1 billion. In this period, Druckenmiller made new purchases in 9 stocks, sold out of 17, reduced holdings in 14, and made additional purchases in 4 stocks. The top ten holdings comprise more than 75% of the overall portfolio. Some of the top stocks in the portfolio include Chevron Corporation (NYSE:CVX), CrowdStrike Holdings, Inc. (NASDAQ:CRWD), and Eli Lilly and Company (NYSE:LLY).

As the market undergoes a period of turmoil due to soaring inflation and rising interest rates, Druckenmiller, famous for his growth stock picks, has been shedding many risky stocks from his portfolio. The activity aligns with his recent comments regarding the growth sector in which he warned investors of a “massive bubble” in crypto, meme stocks, and other risky investments and noted that this bubble seemed larger in scope than the dot-com bubble at the turn of the millennium.

Our Methodology

The companies listed below were picked from the investment portfolio of Duquesne Capital at the end of the second quarter of 2022. The stocks in which the hedge fund has decreased stakes by 25% or more, compared to filings for the first quarter of 2022, were selected. Data from around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to identify the number of hedge funds that hold stakes in each firm.

Billionaire Stanley Druckenmiller is Decreasing Stakes in These Stocks

10. Cenovus Energy Inc. (NYSE:CVE)

Number of Hedge Fund Holders: 42

Percentage Decrease in Stake During Q2 2022: 26%

Cenovus Energy Inc. (NYSE:CVE) produces and markets oil and gas. Securities filings show that Duquesne Capital owned 1 million shares of Cenovus Energy Inc. (NYSE:CVE) at the end of June 2022 worth $20 million, representing close to 1.47% of the portfolio.

On August 18, investment advisory Credit Suisse assumed coverage of Cenovus Energy Inc. (NYSE:CVE) stock with an Outperform rating and a price target of C$37. Analyst William Janela issued the ratings update.

At the end of the second quarter of 2022, 42 hedge funds in the database of Insider Monkey held stakes worth $2.9 billion in Cenovus Energy Inc. (NYSE:CVE), compared to 44 in the previous quarter worth $2.3 billion.

Just like Chevron Corporation (NYSE:CVX), CrowdStrike Holdings, Inc. (NASDAQ:CRWD), and Eli Lilly and Company (NYSE:LLY), Cenovus Energy Inc. (NYSE:CVE) is one of the stocks that hedge funds are monitoring.

In its Q4 2021 investor letter, L1 Capital, an asset management firm, highlighted a few stocks and Cenovus Energy Inc. (NYSE:CVE) was one of them. Here is what the fund said:

“Detailed, bottom-up stock research remains the investment team’s primary focus and the core driver of portfolio performance. 2021 once again demonstrated the team’s ability to identify ‘winners’ through extensive company and industry research across a diverse range of sectors. Key contributors included Cenovus Energy Inc. (NYSE:CVE), (due to) recovering oil price leading to improved investor sentiment, consensus earnings upgrades and strong free cashflow generation.”

9. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 258

Percentage Decrease in Stake During Q2 2022: 28%

Microsoft Corporation (NASDAQ:MSFT) is a Washington-based technology firm. According to the latest filings, Duquesne Capital owned over 740,700 shares of Microsoft Corporation (NASDAQ:MSFT) at the end of June 2022 2022 worth $190 million, representing 13.76% of the portfolio.

On July 27, Wedbush analyst Daniel Ives maintained an Outperform rating on Microsoft Corporation (NASDAQ:MSFT) stock and lowered the price target to $320 from $340, noting that the metrics around cloud and commercial bookings looked strong for the firm.

Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Microsoft Corporation (NASDAQ:MSFT), with 28 million shares worth more than $7.3 billion.

In its Q1 2022 investor letter, Carillon Tower Advisers, an investment management firm, highlighted a few stocks and Microsoft Corporation (NASDAQ:MSFT) was one of them. Here is what the fund said:

“Stock selection contributed the most while sector allocation was also positive. An underweight to communication services and an overweight to energy helped performance, while an underweight to consumer staples and an overweight to materials detracted. Stock selection was strong within healthcare and materials but was weak within information technology and industrials. Microsoft Corporation (NASDAQ:MSFT) reported positive results driven by personal computing strength, but analysts were especially positive on its growth outlook for its Azure cloud-computing services.”

8. Freeport-McMoRan Inc. (NYSE:FCX)

Number of Hedge Fund Holders: 56

Percentage Decrease in Stake During Q2 2022: 34%

Freeport-McMoRan Inc. (NYSE:FCX) is an Arizona-based minerals and mining firm. Latest data shows that the hedge fund led by Druckenmiller owned more than 3.2 million shares in Freeport-McMoRan Inc. (NYSE:FCX) at the end of the second quarter of 2022 worth close to $94 million, representing 6.84% of the portfolio.

On July 22, RBC Capital analyst Sam Crittenden maintained a Sector Perform rating on Freeport-McMoRan Inc. (NYSE:FCX) stock and lowered the price target to $35 from $46, noting that the firm had posted another strong operating quarter.

At the end of the second quarter of 2022, 56 hedge funds in the database of Insider Monkey held stakes worth $2.4 billion in Freeport-McMoRan Inc. (NYSE: FCX), compared to 68 in the preceding quarter worth $4.1 billion.

In its Q4 2021 investor letter, Horizon Kinetics LLC, an asset management firm, highlighted a few stocks and Freeport-McMoRan Inc. (NYSE:FCX) was one of them. Here is what the fund said:

“Those were some ideas about copper demand. Here are some specifics about supply. Global copper mine production in the 10 years from 2005 to 2015 rose 2.45% annually. In the next 5 years, to 2020, it increased by only 0.9% annually. Even ignoring the 2020 pandemic year, for the 4 years from to 2019, the expansion rate was 1.66%. We already have the historical context for this: the commodity price collapse prior to 2015, from a position of excess capacity.

What producers must do in that situation, because they have high fixed costs and debt expense, is curtail their exploration and development expenditures and reduce operating costs. They rely on existing mines, instead, and on their highest-grade ores and lowest-cost production. They might not actually reduce current production, but they aren’t replacing the reserves that are being slowly drawn down. You can see this at work at the individual company level.

Freeport-McMoRan Inc. (NYSE:FCX) will illustrate. It is the world’s third-largest copper producer, closely following Chile’s Codelco and Australia’s BHP Group. In 2014, even though Freeport sold more copper than the prior year, its revenues dropped by over 25%, and it went from $4.8 billion of operating earnings (a 22% margin) to a $(0.2) billion loss. The company’s capital expenditures peaked in 2014 at $3.86 billion and will be about $1.72 billion in 2021, meaning the company is spending 55% less now than it was seven years ago. In inflation-adjusted terms, it’s spending 61% less today than seven years ago…” (Click here to see the full text)

7. Booking Holdings Inc. (NASDAQ:BKNG)

Number of Hedge Fund Holders: 93

Percentage Decrease in Stake During Q2 2022: 48%

Booking Holdings Inc. (NASDAQ:BKNG) provides online reservation services. Latest data shows that Duquesne Capital owned 7,700 shares of Booking Holdings Inc. (NASDAQ:BKNG) at the end of the second quarter of 2022 worth over $13.5 million, representing 0.98% of the portfolio.

On August 5, Susquehanna analyst Shyam Patil maintained a Positive rating on Booking Holdings Inc. (NASDAQ:BKNG) stock and lowered the price target to $2,800 from $2,900, noting that travel demand was strong in the second quarter of 2022.

At the end of the second quarter of 2022, 93 hedge funds in the database of Insider Monkey held stakes worth $5.4 billion in Booking Holdings Inc. (NASDAQ:BKNG), compared to 99 in the previous quarter worth $7.5 billion.

In its Q4 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Booking Holdings Inc. (NASDAQ:BKNG) was one of them. Here is what the fund said:

“The pandemic created opportunities for us to be more aggressive in a variety of areas of the market. We were opportunistic throughout the year, for example, in positioning the portfolio to benefit from a flush consumer eager to return to spending and traveling. New positions included Booking Holdings Inc. (NASDAQ:BKNG), an online travel agency with industry-leading margins and a dominant footprint in Europe.”

6. SolarEdge Technologies, Inc. (NASDAQ:SEDG)

Number of Hedge Fund Holders: 40

Percentage Decrease in Stake During Q2 2022: 56%

SolarEdge Technologies, Inc. (NASDAQ:SEDG) markets semiconductor equipment to the solar industry. Regulatory filings reveal that the investment firm of Druckenmiller owned 13,400 shares of SolarEdge Technologies, Inc. (NASDAQ:SEDG) at the end of the second quarter of 2022 worth $3.6 million, representing 0.26% of the portfolio.

On August 18, Morgan Stanley analyst Stephen Byrd maintained an Equal Weight rating on SolarEdge Technologies, Inc. (NASDAQ:SEDG) stock and raised the price target to $353 from $316, noting the firm would benefit from the Inflation Reduction Act.

Among the hedge funds being tracked by Insider Monkey, London-based investment firm Impax Asset Management is a leading shareholder in SolarEdge Technologies, Inc. (NASDAQ:SEDG), with 580,909 shares worth more than $158 million.

Alongside Chevron Corporation (NYSE:CVX), CrowdStrike Holdings, Inc. (NASDAQ:CRWD), and Eli Lilly and Company (NYSE:LLY), SolarEdge Technologies, Inc. (NASDAQ:SEDG) is one of the stocks that elite investors have on their radar.

In its Q1 2022 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and SolarEdge Technologies, Inc. (NASDAQ:SEDG) was one of them. Here is what the fund said:

“The Strategy is well-exposed to this secular shift and to accelerated spending on alternative energy sourcing and generation. Growth in renewables should benefit SolarEdge Technologies, Inc. (NASDAQ:SEDG), a company we repurchased on weakness in the first quarter that develops electronics for solar installations and should take advantage of greater incentives for solar installations in many geographies. SolarEdge Technologies, Inc. (NASDAQ:SEDG) has expanded its products offering to address larger markets in commercial and utility solar on top of its traditional residential solar market.”

Click to continue reading and see Billionaire Stanley Druckenmiller is Decreasing Stakes in These 5 Stocks.

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