In this article, we will look at stocks that Dan Loeb is buying for the rest of 2022. If you want to explore more stocks that Dan Loeb is buying, you can also take a look at Dan Loeb is Buying These 3 Stocks for the Rest of 2022.
In 1995, Dan Loeb borrowed $3.3 million from his friends and family to launch his hedge fund, Third Point. Dan Loeb gained popularity as a result of the success of his activist shareholder initiatives and the multiple business takeovers he carried out over the course of his career. The activist investor’s net worth as of September 2022 was $3.5 billion, per data from Forbes. A 1983 graduate of Columbia University, Loeb endows a namesake scholarship for undergraduate study there. When Dan Loeb was a student at Columbia University, he had already earned about $120,000 in earnings from investments, which he eventually lost on a disastrous deal. According to Loeb, this poor investment taught him about the difficulties of “over concentrating positions.”
Investments made by Third Point are concentrated in the private equity, fixed income, and American depositary receipt markets. In addition to its headquarters in New York, the company has six other locations, including ones in Hong Kong, India, and London. Third Point Partners Qualified L.P., Third Point Partners L.P., Third Point Offshore Master Fund L.P., and Third Point Ultra Master Fund L.P. are also under its management as investment vehicles. Third Point held $4.22 billion in managed 13F securities, according to Q2 13F filings. In Loeb’s second-quarter 2022 investor letter, Third Point’s annualized return was recorded at 13.7%, compared to the S&P 500’s 8.5% annualized return. In the second quarter, the fund sold 21 stocks and acquired 4 new stocks. The fund also decreased its holdings in 14 equities while increasing its purchases in 4 of them. The fund has a top 10 holdings concentration of 74.85%, with the Utilities and Telecommunications sector comprising 24.19% of the portfolio. Its largest holding is PG&E Corp. (NYSE:PCG), with shares held of 65.4 million.
SentinelOne, Inc. (NYSE:S), PG&E Corporation (NYSE:PCG), and Danaher Corporation (NYSE:DHR) are some of the most notable names in Third Point’s portfolio.
Our Methodology
These stocks were picked from the second quarter 2022 13F portfolio of Third Point LLC. We picked the stocks in which the hedge fund initiated new stakes in Q2 or increased its hold. The hedge fund sentiment around each stock was taken from Insider Monkey’s Q2 database of 895 elite hedge funds.
7. Sema4 Holdings Corp. (NASDAQ:SMFR)
Third Point’s Stake Value: $6.987 million
Percentage of Third Point’s 13F Portfolio: 0.16%
Number of Hedge Fund Holders: 27
Sema4 Holdings Corp. (NASDAQ:SMFR), doing business as Sema4, is a health information business that uses data to improve disease diagnosis, treatment, and prevention. It was incorporated in 2020 and is headquartered in Stamford, Connecticut. Precision medicine and population health platform services are made possible by big data and machine learning, which are also booming in the healthcare sector. Sema4 Holdings Corp. (NASDAQ:SMFR) has gathered vast quantities of medical data and a sophisticated platform in order to mine these for useful information for healthcare systems, pharmaceutical firms, and individuals.
Dan Loeb’s Third Point added Sema4 Holdings Corp. (NASDAQ:SMFR) to its portfolio during Q3, 2021, holding 2.795 million shares. It has now increased its stake to 5.54 million shares during the recent quarter. Other hedge funds tracked by Insider Monkey, though, are bearish on Sema4 Holdings Corp. (NASDAQ:SMFR) as the number of hedge funds holding Sema4 shares has reduced from 38 to 27 during Q2 as compared to the previous quarter.
Sema4 Holdings Corp. (NASDAQ:SMFR) released its quarterly earnings report on August 15. The stock has missed both the EPS and revenue forecasts by $0.05 and $ 31.38 million, respectively. On August 18, Sema4 Holdings Corp. (NASDAQ:SMFR) price target was reduced by BTIG analyst Mark Massaro from $5 to $3 while maintaining a Buy rating for the stock. According to the analyst’s research note to investors, the company announced a “difficult” Q2 earnings miss along with management changes and restructuring. But over the long term, Massaro is still optimistic, adding that he anticipates some stability in payor pressures in the upcoming quarters and that the company currently trades below his revised $420M sales forecast for 2025.
6. Ovintiv Inc. (NYSE:OVV)
Third Point’s Stake Value: $270.443 million
Percentage of Third Point’s 13F Portfolio: 6.4%
Number of Hedge Fund Holders: 47
Ovintiv Inc. (NYSE:OVV) was incorporated in 2020 and is based in Denver, Colorado. Ovintiv Inc. (NYSE:OVV) and its subsidiaries are involved in the exploration, development, production, and selling of natural gas, oil, and natural gas liquids.
The stock has gained 6.74% in the past six months and 43.41% year to date. According to its quarterly earnings report announced on August 3, Ovintiv Inc. (NYSE:OVV) has generated an EPS GAAP actual of $5.21 and revenue of $3.74 billion, both above the market consensus. On August 31, keeping an Overweight rating on the stock, Barclays analyst Jeanine Wai increased the price target for Ovintiv from $71 to $75. The “knee-jerk reaction” to the Alternative Minimum Tax affecting tax “safe-haven” exploration and production names is understandably negative on an absolute basis, but after more consideration, it’s not as bad as feared as long as the companies maintain their “top-tier” free cash flow yields, writes Wai to investors in a research note.
SentinelOne, Inc. (NYSE:S), PG&E Corporation (NYSE:PCG), and Danaher Corporation (NYSE:DHR) are some of the significant names, along with Ovintiv Inc. (NYSE:OVV), in Dan Loeb’s portfolio.
5. Cenovus Energy Inc. (NYSE:CVE)
Third Point’s Stake Value: $138.298 million
Percentage of Third Point’s 13F Portfolio: 3.27%
Number of Hedge Fund Holders: 42
Cenovus Energy Inc. (NYSE:CVE) is a Calgary, Canada-based oil and natural gas company with a $34.26 billion market capitalization. It is one of Canada’s best-performing energy stocks in 2022. The stock has gained a 40.38% value year to date as of September 9. The profitability of Cenovus Energy has significantly improved since the company bought the ConocoPhillips shareholding in 2017. The global energy crisis is still going on. In recent months, the Strategic Petroleum Reserve (SPR) release has concealed the issue, but prices have started to rise once again. The U.S. SPR release is expected to come to an end in October. Cenovus Energy Inc. (NYSE:CVE) will benefit greatly from these trends.
Cenovus Energy Inc. (NYSE:CVE) became part of Dan Loeb’s portfolio during Q1, 2021, with 2 million shares which have now increased to 7.2 million shares, comprising 3.27% of his portfolio. On August 10, William Janela of Credit Suisse began covering Cenovus Energy with an Outperform rating and a C$37 price target. Cenovus Energy Inc. (NYSE:CVE) is a noteworthy name in Dan Loeb’s portfolio, along with SentinelOne, Inc. (NYSE:S), PG&E Corporation (NYSE:PCG), and Danaher Corporation (NYSE:DHR).
L1 Capital Long Short Fund Limited, in its Q4 2021 investor letter, mentioned Cenovus Energy Inc. (NYSE: CVE) and discussed its stance on the firm. 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, (due to) recovering oil price leading to improved investor sentiment, consensus earnings upgrades and strong free cashflow generation.”
4. T-Mobile US, Inc. (NYSE:TMUS)
Third Point’s Stake Value: $65.252 million
Percentage of Third Point’s 13F Portfolio: 1.54%
Number of Hedge Fund Holders: 96
T-Mobile US, Inc. (NYSE:TMUS) was founded in 1994 and is headquartered in Bellevue, Washington. The company, together with its subsidiaries, provides mobile communications services in the United States, Puerto Rico, and the United States Virgin Islands. On September 9, T-Mobile US, Inc. (NYSE:TMUS) price target was raised to $178 from $175 at Raymond James while maintaining a Strong Buy recommendation for the stock. According to a research note from Ric Prentiss, an analyst at Raymond James, the T-Mobile US, Inc. (NYSE:TMUS) board had approved a $14 billion stock repurchase programme until September 30, 2023, which can include up to $3 billion through the end of 2022.
At the end of Q2 2022, 96 hedge funds disclosed ownership of stakes in T-Mobile US, Inc. (NYSE:TMUS) with an aggregate value of $6.85 billion. This is compared to 91 hedge funds holding $7.24 billion worth of stakes in the company in the preceding quarter.
On August 25, in order to expand the mobile operator’s network using Starlink’s constellation of satellites, T-Mobile US, Inc. (NYSE:TMUS) and SpaceX announced technology cooperation. This is primarily intended for locations without cellular access and should appeal to subscribers. The service will first concentrate on enabling users to send text messages from any location with a clear view of the sky. T-Mobile will eventually work on utilizing that new network for voice calls and data connections. Speaking financially, this translates to increased revenue for the mobile network provider when voice and messaging services are implemented and decreased capex as the partnership is expanded to include data.
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Disclosure: None. Dan Loeb is Buying These Stocks for the Rest of 2022 is originally published on Insider Monkey.
