Dan Loeb’s Third Point is one of the world’s top hedge funds. Insiders meanwhile have a lot of knowledge over their companies. In this article, we will analyze stocks that Third Point owns and that insiders have bought some shares in over around past six months, including Adobe Inc. (NASDAQ:ADBE), American Express Company (NYSE:AXP), Microsoft Corporation (NASDAQ:MSFT), salesforce.com, inc. (NYSE:CRM), and Campbell Soup Company (NYSE:CPB).
According to most market participants, hedge funds are assumed to be underperforming, outdated investment tools of years past. While there are greater than 8000 funds trading today, We choose to focus on the moguls of this club, about 700 funds. These investment experts shepherd most of all hedge funds’ total asset base, and by keeping an eye on their first-class equity investments, Insider Monkey has formulated a number of investment strategies that have historically outperformed Mr. Market. Insider Monkey’s flagship hedge fund strategy outpaced the S&P 500 index by 6 percentage points per year since its inception in May 2014 through early November 2018. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 26.1% since February 2017 even though the market was up nearly 19% during the same period. We just shared a list of 11 short targets in our latest quarterly update.
Adobe Inc. (NASDAQ:ADBE)
Third Point held 900,000 shares of Adobe Inc. (NASDAQ:ADBE) at the end of Q3 and one insider, Director David Ricks, bought 75 shares on September 24 at a cost of $261.43 per share. Insiders and Third Point aren’t the only ones bullish. Analyst Christopher Eberle of Nomura has a ‘Buy’ rating and a $315 target price, citing Adobe’s global collaboration platform as a reason to be bullish. Shares are up 45% year to date so far.
American Express Company (NYSE:AXP)
In his quarterly letter, Loeb notes, ‘Amex has a significant opportunity to sustain higher revenue growth as it prioritizes investments that drive customer acquisition, card acceptance, and higher average spend’. Loeb concludes, ‘With shares trading at just 12.5x our 2019E EPS, and 11x 2020E EPS, we think markets under‐appreciate the strategic pivot 7 occurring at Amex and see shares trading above $135 over the next 18 months’. Third Point is pretty bullish as it initiated a new stake of over half a billion dollars worth of American Express Company (NYSE:AXP) (as of Sept 30) in the third quarter. Insiders too. According to our data, there were 2 insider purchases in the stock over the around six months.
Microsoft Corporation (NASDAQ:MSFT)
Microsoft is back in many ways. Not only is it challenging Apple again for the world’s most valuable company, but it is also surely adjusting to the secular growth trends of the cloud and big data. The smart money is bullish. Third Point raised its stake by 83% to 4.1 million shares of Microsoft at the end of Q3. Director Sandra Peterson also bought 5,400 shares of Microsoft Corporation (NASDAQ:MSFT) at $101.96 per share on June 5.
salesforce.com, inc. (NYSE:CRM)
salesforce.com shares are up 41% year to date as investors cheer the company’s growth, especially in the third quarter in which revenue came in at $3.39 billion, versus the estimate of $3.37 billion. EPS also came in better than expected at $0.61 versus the consensus of $0.50. Keith Weiss of Morgan Stanley has a $178 price target and ‘Overweight’ rating. Insiders and Third Point are bullish: according to our data there were 2 insider purchases in salesforce.com, inc. (NYSE:CRM) over the last around six months. Third Point owned also 500,000 shares at the end of September.
Campbell Soup Company (NYSE:CPB)
Although shares are down almost 20% year to date, insiders and Third Point have been going the other way, at least in terms of the rear view mirror. There were 2 insider buys for Campbell Soup Company (NYSE:CPB) in around the last six months. Third Point raised its stake by 225% to 18 million shares as of September 30. It’s not hard to see why some might be bullish. Shares trade for less than 15x forward earnings estimates and the stock yields over 3.5% dividend wise.