In this article, we discuss the 5 stocks Stanley Druckenmiller is dumping. If you want to read our detailed analysis of these stocks, go directly to Stanley Druckenmiller is Dumping These 10 Stocks.
5. Citigroup Inc. (NYSE: C)
Number of Hedge Fund Holders: 87
Citigroup Inc. (NYSE: C) is ranked fifth on our list of 10 stocks Stanley Druckenmiller is dumping. The firm provides financial services and is headquartered in New York. Regulatory filings reveal that Duquesne Capital first bought a stake in the firm in the first quarter of 2021. This stake was sold during the second quarter of the year. The fund paid an estimated average price of $72.75 per share for the stake. At the end of June, the shares were trading at $70.75.
On July 6, investment advisory Keefe Bruyette assumed coverage of Citigroup Inc. (NYSE: C) stock with an Outperform rating and a price target of $85, noting that universal banks had compelling transformational stories expected to drive improved shareholder value.
At the end of the second quarter of 2021, 87 hedge funds in the database of Insider Monkey held stakes worth $6.1 billion in Citigroup Inc. (NYSE: C), down from 90 the preceding quarter worth $6.9 billion.
In its Q1 2021 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Citigroup Inc. (NYSE: C) was one of them. Here is what the fund said:
“We fully exited position in Citigroup. Global financial services company Citigroup made a $900 million clerical error and received a public reprimand from federal regulators. This, after a decade focused on process control, information technology and risk systems, makes the error substantially more costly than just the $900 million mistake. Regulators believe the company’s risk management improvements have fallen short of expectations. To rectify the situation, a process and technology spending surge could negatively affect 2021-2022 profits by 10% to 20%. Trust and confidence are important in large financial institutions, and this incident combined with the CEO’s sudden retirement shook ours.”
4. Micron Technology (NASDAQ: MU)
Number of Hedge Fund Holders: 87
Micron Technology (NASDAQ: MU) is an Idaho-based firm that makes and sells memory and storage products. It is placed fourth on our list of 10 stocks Stanley Druckenmiller is dumping. According to latest data, the fund sold off its entire stake in the company between March and June this year.
On August 26, investment advisory KeyBanc reiterated an Overweight rating on Micron Technology (NASDAQ: MU) stock with a price target of $120, noting that consolidation in the industry would help stabilize prices and have positive implications on the firm.
At the end of the second quarter of 2021, 87 hedge funds in the database of Insider Monkey held stakes worth $6.3 billion in Micron Technology (NASDAQ: MU), down from 100 in the preceding quarter worth $7.6 billion.
In its Q1 2021 investor letter, Bonsai Partners, an asset management firm, highlighted a few stocks and Micron Technology (NASDAQ: MU) was one of them. Here is what the fund said:
“Micron is a manufacturer of memory semiconductor chips. Micron appreciated 17.3% during the quarter.
With the semiconductor cycle in full swing, sentiment continued to improve for major DRAM and NAND suppliers. Spot pricing for DRAM continues its upward march due to supply shocks across the industry and sustained demand levels that continue to outstrip supply.
As a result, Micron showed improving results for the fiscal first quarter, raised guidance intra-quarter for the fiscal second quarter, and offered strong guidance for the fiscal third quarter in both growth and margins.
While the cyclical nature of DRAM hasn’t changed, the cycles themselves continue to become more benign, leading to long-term economic improvement across these businesses. Micron is now continuously profitable, with industry players in a dramatically stronger position than even just five years ago.
The biggest negative surprise in the quarter came from Micron’s exit from its 3D XPoint hybrid memory business. The company also announced its decision to sell its accompanying Utah fab. Fortunately, this development does not alter the investment thesis much since 3D XPoint was an option ticket for future growth. While it’s unfortunate this product didn’t pan out, now is an excellent time to sell a fab, so perhaps it is a blessing in disguise?”
3. JPMorgan Chase & Co. (NYSE: JPM)
Number of Hedge Fund Holders: 108
JPMorgan Chase & Co. (NYSE: JPM) is a New York-based financial services company. It is ranked third on our list of 10 stocks Stanley Druckenmiller is dumping. Mandatory filings reveal that the fund first owned a stake in the company in the fourth quarter of 2019. It sold off the entire stake in the second quarter of 2021. The fund paid an estimated average price of $152.23 per share for the holding. At the end of June, the shares were trading at $155.54.
On July 14, investment advisory Credit Suisse maintained an Outperform rating on JPMorgan Chase & Co. (NYSE: JPM) stock and raised the price target to $177 from $170, appreciating the strong quarterly results posted by the finance firm.
Out of the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in the firm with 6.9 million shares worth more than $1 billion.
In its Q4 2020 investor letter, Bretton Fund, an asset management firm, highlighted a few stocks and JPMorgan Chase & Co. (NYSE: JPM) was one of them. Here is what the fund said:
“After a strong performance in 2019, we wrote this about our bank stocks in last year’s report: “There will be another recession sooner than later, and our banks will see larger loans losses, but we think this is more than priced into the stock, and our banks are well reserved for that eventuality.” Little did we know “sooner” really meant “a few weeks from now.” Despite the economic shock, the banks still have huge capital cushions that can absorb large loan losses. Our remaining bank investments, JPMorgan and Bank of America, increased their reserves significantly at the beginning of the Covid-19 crisis in anticipation of imminent loan defaults, but with the government stimulus and perhaps a more resilient economy than many would have guessed, actual loan losses are up only slightly. They might happen later in 2021, but with an additional stimulus package and the vaccine rolling out, the large-scale losses may not be as bad as most people predicted. The bigger drag on the banks’ earnings power is lower rates, which in our opinion will persist for a long time. Despite this drag, we estimate both JPMorgan and Bank of America will continue to grow revenue and earnings over the next few years, while we believe their stocks remain bargains in a somewhat expensive market. JPMorgan’s earnings per share declined 17% last year, and its stock returned -5.5%. Bank of America’s earnings, which are more sensitive to interest rates, were down 32%, and its stock returned -11.6%.”
2. Uber Technologies, Inc. (NYSE: UBER)
Number of Hedge Fund Holders: 135
Uber Technologies, Inc. (NYSE: UBER) is placed second on our list of 10 stocks Stanley Druckenmiller is dumping. The company owns and operates a ride hailing platform and is headquartered in California. Duquesne Capital first owned a stake in the ride-hailing company during the third quarter of 2020. It sold off the entire stake it had in the firm during the second quarter of 2021. The fund paid an estimated average price of $48.69 per share for the holding. At the end of June, the shares were trading at $50.12.
On August 23, investment advisory Mizuho reiterated a Buy rating on Uber Technologies, Inc. (NYSE: UBER) stock with a price target of $72, noting the firm had a strong case in a regulatory appeal, an application for which is due in the next two months.
Out of the hedge funds being tracked by Insider Monkey, California-based investment firm Altimeter Capital Management is a leading shareholder in the firm with 24 million shares worth more than $1.2 billion.
RiverPark Advisors, LLC, in its Q4 2020 investor letter, mentioned Uber Technologies, Inc. (NYSE: UBER). Here is what the fund has to say in its letter:
“UBER was also a strong contributor, as shares rallied following the approval of California’s Proposition 22 by voters, allowing the company’s California-based drivers to remain independent contractors (rather than become more expensive employees). We believe this news is not just about the 10%-15% of Uber’s revenue tied to California, but the influence this will have on other states reassessing driver pay. UBER also reported strong third quarter results with Delivery Gross Bookings growing 135% year-over-year which nearly fully offset a reduction in Mobility Gross Bookings, which were down 50% year over year. Total Gross Bookings for the quarter were down only 10% year over year as compared with down 35% last quarter.
Despite the COVID disruption, UBER remains the undisputed global leader in ride sharing (44% of the Company’s third quarter revenue), with greater than 50% share in every major region in which it operates. The company is also a leader in food delivery (46% of revenue), where it is number one or two in the more than 25 countries in which it operates. We view UBER as more than just ride sharing and food delivery, but also as a global mobility platform with the ability to sell to its more than 100 million users (by comparison, Amazon Prime has 130+ million members) and penetrate new markets of on-demand services, such as grocery delivery, truck brokerage and worker staffing for shift work. At its current $96 billion market capitalization, UBER trades at only 6x next year’s revenue from its two core businesses. Additionally, the company has substantial, seemingly unrecognized, value in its several nascent development businesses and another $12 billion in equity stakes in synergistic businesses around the world.”
1. PayPal Holdings, Inc. (NASDAQ: PYPL)
Number of Hedge Fund Holders: 143
PayPal Holdings, Inc. (NASDAQ: PYPL) is ranked first on our list of 10 stocks Stanley Druckenmiller is dumping. The company markets payments services and operates from California. Securities filings reveal that Duquesne Capital first owned a stake in the firm in the first quarter of 2020. The fund sold off its entire stake in the payments firm in the second quarter of 2021. It paid an estimated average price of $95.74 per share for the stake. At the end of June, the shares were trading at $291.48.
On July 29, investment advisory Morgan Stanley maintained an Overweight rating on PayPal Holdings, Inc. (NASDAQ: PYPL) stock and raised the price target to $340 from $337, calling engagement and acceptance expansion positive growth indicators for the company.
At the end of the second quarter of 2021, 143 hedge funds in the database of Insider Monkey held stakes worth $16 billion in PayPal Holdings, Inc. (NASDAQ: PYPL), the same as in the preceding quarter worth $14 billion.
In its Q4 2020 investor letter, Polen Capital Management, an asset management firm, highlighted a few stocks and PayPal Holdings, Inc. (NASDAQ: PYPL) was one of them. Here is what the fund said:
“For the full year 2020, one of the top performers was PayPal, which we purchased in 2019, the company continues to take market share in digital payments and has seen an acceleration in user adoption and engagement, especially within their “silver tech” or older user demographic. We expect many more years of ongoing double-digit growth from their various business segments and new initiatives.”
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