In this article, we are going to take a look at the Top 10 Stock Picks of Steve Zheng’s Deepcurrents Investment Group.
With a vibrant career in the finance industry and an MBA from Wharton School at the University of Pennsylvania, Steve Zheng founded Deepcurrents Investment Group in 2017 and currently serves as its Chief Investment Officer. He previously held the position of the portfolio manager at Verition Fund Management LLC, based in Greenwich, Connecticut. Mr. Zheng has also served at Deutsche Bank AG as a senior trader, managing volatility arbitrage portfolio, US capital structure arbitrage, and convertibles. Mr. Zheng received his double bachelor’s degree with Honors in Mechanical Engineering and International Trade from Shanghai Jiao Tong University in Shanghai, China.
Based in New York, Deepcurrents Investment Group is a relative value asset management firm that views the investment world through the lens of volatility. Their main investments are in Healthcare, Services, and Technology sectors.
Among Zheng’s and Deepcurrents’ most notable positions are companies like Booking Holdings Inc. (NASDAQ: BKNG), Jetblue Airways Corporation (NASDAQ: JBLU), and CONMED Corporation (NYSE: CNMD).
Our Methodology
Here’s a look at the top 10 stock picks of Steve Zheng’s Deepcurrents Capital Management, according to Deepcurrents’ portfolio for the third quarter. In addition, we are going to take a look at the overall hedge fund sentiment towards the companies that Steve Zheng is bullish on.
Top 10 Stock Picks of Steve Zheng’s Deepcurrents Investment Group
10. FedEx Corporation (NYSE:FDX)
Deepcurrents Investment Group’s Stake Value: $3.91 million
Percentage of Deepcurrents Investment Group’s 13F portfolio: 0.11%
Total Number of Hedge Fund Holders: 61
Ranking 10th on Steve Zheng’s list of top stocks is FedEx Corporation (NYSE: FDX), a transportation company that deals in e-commerce and related business services worldwide.
According to Q3 2021 data, Deepcurrents Investment Group holds 17,848 shares in the company worth $3.91 million, representing 0.11% of the fund’s overall holdings.
On October 6, research firm Cowen kept an ‘Outperform’ rating on FedEx Corporation (NYSE: FDX) stock, lowering the price target to $283 from $297. The firm’s analyst Helane Becker noted that the company would continue on an upward trajectory as e-commerce demand continues to surge.
For the third quarter of 2021, FedEx Corporation (NYSE: FDX) posted an EPS of $3.47, beating estimates by $0.23. Revenue for the quarter stood at $22.00 billion, beating analysts’ forecasts by $105.20 million.
By the end of June, 61 out of 873 hedge funds tracked by Insider Monkey reported owning stakes in FedEx Corporation (NYSE: FDX), with a combined value of $2.17 billion. This is a slight change from the Q1 2021 where 63 hedge funds held positions worth $2.26 billion in the company.
Just like Booking Holdings Inc. (NASDAQ: BKNG), Jetblue Airways Corporation (NASDAQ: JBLU) and CONMED Corporation (NYSE: CNMD), Fedex Corp (NYSE: FDX) remains an exciting stock pick for investors.
9. Booking Holdings Inc. (NASDAQ:BKNG)
Deepcurrents Investment Group’s Stake Value: $3.99 million
Percentage of Deepcurrents Investment Group’s 13F portfolio: 0.11%
Total Number of Hedge Fund Holders: 100
Booking Holdings Inc. (NASDAQ: BKNG) is a provider of online travel and accommodation services which operates through several brands: Booking.com, Rentalcars.com, KAYAK, and OpenTable, among others.
According to data for Q2 2021, 100 hedge funds out of 873 tracked by Insider Monkey reported holding positions worth $6.94 billion in Booking Holdings Inc. (NASDAQ: BKNG), in comparison to $6.81 billion worth of positions being held by 103 hedge funds in the previous quarter.
In Q3 2021, the company posted an EPS of $37.70, beating estimates by $4.67.
On November 10, research firm Argus upgraded its rating from ‘Hold’ to ‘Buy’ on Booking Holdings Inc. (NASDAQ: BKNG) stock, setting the price target at $3,060. The firm’s analyst John Staszak cited the company’s focus on Europe, given its relatively high vaccination rates, as a boost to sales in the region.
8. Euronet Worldwide, Inc. (NASDAQ:EEFT)
Deepcurrents Investment Group’s Stake Value: $5.62 million
Percentage of Deepcurrents Investment Group’s 13F portfolio: 0.16%
Total Number of Hedge Fund Holders: 40
Up next we have Euronet Worldwide, Inc. (NASDAQ: EEFT), which deals in providing electronic payment and transaction processing solutions to various businesses, merchants, retailers, and individual consumers.
On October 22, research firm Truist kept a ‘Buy’ rating on the company’s shares, lowering the price target to $185 from $225. These ratings were provided by the company’s analyst Andrew Jeffrey.
For the third quarter of 2021, Euronet Worldwide, Inc. (NASDAQ: EEFT) posted an EPS of $1.77, beating estimates by $0.35. The company posted revenue of $816.60 million for the quarter, beating analysts’ forecasts by $33.13 million.
As of the second quarter of 2021, 40 hedge funds out of 873 tracked by Insider Monkey reported owning stakes in Euronet Worldwide, Inc. (NASDAQ: EEFT). The combined value of these stakes stood at $368 million.
7. General Motors Company (NYSE:GM)
Deepcurrents Investment Group’s Stake Value: $6.22 million
Percentage of Deepcurrents Investment Group’s 13F portfolio: 0.18%
Total Number of Hedge Fund Holders: 86
Ranking 7th on Steve Zheng’s list of top stocks is General Motors Company (NYSE: GM). The company is a leading automobile manufacturer based in the United States. Steve Zheng’s Deepcurrents Investment Group holds 118,000 shares in General Motors Company (NYSE: GM) worth $6.22 million, which represents 0.18% of the fund’s overall portfolio.
Out of 873 hedge funds tracked by Insider Monkey, 86 reported holding positions in General Motors Company (NYSE: GM) in the second quarter of 2021. The combined value of these holdings stood at $7.41 billion, compared to the same number of hedge funds holding $8.06 billion in the first quarter.
In Q3 2021, General Motors Company (NYSE: GM) reported an EPS of $1.52, beating estimates by $0.55.
On November 11, research firm Morgan Stanley kept an ‘Overweight’ rating on General Motors Company (NYSE: GM) stock, lowering the price target from $80 to $78.
6. Expedia Group, Inc. (NASDAQ:EXPE)
Deepcurrents Investment Group’s Stake Value: $6.88 million
Percentage of Deepcurrents Investment Group’s 13F portfolio: 0.2%
Total Number of Hedge Fund Holders: 87
Expedia Group, Inc. (NASDAQ: EXPE) is an online travel company that deals in the provision of travel products and services and operates through its segments: Retail, B2B, and Trivago.
On November 5, Piper Sandler kept its ‘Neutral’ rating on the company’s stock, raising the price target to $197 from $168. The firm’s analyst Thomas Champion noted that despite the deadly Delta variant outbreak, the company posted solid Q3 results as the travel industry started gaining traction again.
As of Q2 2021, 87 hedge funds out of the 873 tracked by Insider Monkey held positions worth $5.92 billion in Expedia Group, Inc. (NASDAQ: EXPE), showing a change from the previous quarter where $6.15 billion worth of positions were held by 86 hedge funds.
In addition to Booking Holdings Inc (NASDAQ: BKNG), Jetblue Airways Corporation (NASDAQ: JBLU) and CONMED Corporation (NYSE: CNMD), Expedia Group, Inc. (NASDAQ: EXPE) is one of the top stocks to invest in.
5. JetBlue Airways Corporation (NASDAQ:JBLU)
Deepcurrents Investment Group’s Stake Value: $8.93 million
Percentage of Deepcurrents Investment Group’s 13F portfolio: 0.26%
Total Number of Hedge Fund Holders: 30
Next up on Steve Zheng’s list of top stocks is Jetblue Airways Corporation (NASDAQ: JBLU), an airline company that carries more than 30 million passengers annually to destinations in the US, Latin America, and the Caribbean.
Steve Zheng’s Deepcurrents Investment Group holds 584,160 shares in Jetblue Airways Corporation (NASDAQ: JBLU) worth $8.93 million, representing 0.26% of the fund’s total portfolio.
On October 6, research firm Goldman Sachs downgraded its rating from ‘Buy’ to ‘Neutral’, changing the price target from $20 to $17. The firm’s analyst Catherine O’Brien noted expectations of positive growth on the path towards profitability recovery over the medium-term.
In Q3 2021, Jetblue Airways Corporation (NASDAQ: JBLU) posted an EPS of -$0.12, beating estimates by $0.06. Quarterly revenue stood at $1.97 billion, beating analysts’ forecast by $46.63 million.
In Q2 2021, 30 hedge funds tracked by Insider Monkey reported owning positions worth $401.72 million in Jetblue Airways Corporation (NASDAQ: JBLU). This is a slight change from last quarter where 29 hedge funds held positions worth $425.68 million in the company.
4. Jazz Pharmaceuticals plc (NASDAQ:JAZZ)
Deepcurrents Investment Group’s Stake Value: $12.85 million
Percentage of Deepcurrents Investment Group’s 13F portfolio: 0.38%
Total Number of Hedge Fund Holders: 34
Jazz Pharmaceuticals plc (NASDAQ: JAZZ) is a biopharmaceutical company that deals in the development and commercialization of pharmaceutical products in the fields of narcolepsy, oncology, pain, and psychiatry.
On November 19, Goldman Sachs reinstated its coverage of Jazz Pharmaceuticals plc (NASDAQ: JAZZ) with a ‘Buy’ rating, setting a $198 price target.
In Q3 2021, the firm posted an EPS of $4.20, beating estimates by $0.89. Jazz Pharmaceuticals plc (NASDAQ: JAZZ) raked in $838.12 million in revenue for the quarter, exceeding analysts’ expectations by $6.06 million.
As of the second quarter of 2021, 34 out of 873 hedge funds tracked by Insider Monkey reported holding positions worth $1.49 billion in Jazz Pharmaceuticals plc (NASDAQ: JAZZ), up from the previous quarter where 37 hedge funds held $1.26 billion worth of stocks in the company.
3. ON Semiconductor Corporation (NASDAQ:ON)
Deepcurrents Investment Group’s Stake Value: $14.39 million
Percentage of Deepcurrents Investment Group’s 13F portfolio: 0.42%
Total Number of Hedge Fund Holders: 44
Then there’s On Semiconductor Corporation (NASDAQ: ON), which deals in the provision of semiconductor components for a range of technological devices. The company is headquartered in Phoenix, Arizona, and operates through its segments: Power Solutions Group, Advanced Solutions Group, and Intelligent Sensing Group.
In Q3 2021, On Semiconductor Corporation (NASDAQ: ON) posted an EPS of $0.87, beating estimates by $0.13.
On November 2, research firm BMO Capital kept its ‘Market Perform’ rating on the company stock, raising the price target to $50 from $45.
As of Q2 2021, 44 hedge funds held positions worth $1.02 billion in On Semiconductor Corporation (NASDAQ: ON), as compared to the previous quarter where 41 hedge funds held $1.27 billion worth of positions in the company. This data was derived from Insider Monkey’s database of 873 hedge funds.
2. CONMED Corporation (NYSE:CNMD)
Deepcurrents Investment Group’s Stake Value: $19.90 million
Percentage of Deepcurrents Investment Group’s 13F portfolio: 0.59%
Total Number of Hedge Fund Holders: 21
CONMED Corporation (NYSE: CNMD) ranks 2nd on Steve Zheng’s list of top stocks to invest in. The company specializes in medical technology, providing surgical equipment and related devices worldwide. Steve Zheng’s Deepcurrents Investment holds 152,109 shares in the company valued at $19.90 million.
As of Q2 2021, 21 hedge funds out of 873 tracked by Insider Monkey held positions worth $174 million in CONMED Corporation (NYSE: CNMD), as compared to the previous quarter where 23 hedge funds owned $236 million worth of stocks.
In Q3 2021, CONMED Corporation (NYSE: CNMD) posted an EPS of $0.80, beating estimates by $0.05.
On October 6, research firm Needham analyst Mike Matson upgraded his rating on CONMED Corporation (NYSE: CNMD) from ‘Hold’ to ‘Buy’, setting a price target of $150. The analyst noted that the company’s Airseal and Buffalo Filter products are primarily responsible for driving growth and increasing margins, with the company expected to see revenue growth in the double digits on the back of its sales force expansion.
1. SPDR S&P 500 ETF Trust (NYSE:SPY)
Deepcurrents Investment Group’s Stake Value: $20.34 million
Percentage of Deepcurrents Investment Group’s 13F portfolio: 0.6%
Deepcurrents upped its hold in SPY by 130%, indicating its overall bullish outlook on the market.
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Disclosure: None. Top 10 Stock Picks of Steve Zheng’s Deepcurrents Investment Group is originally published on Insider Monkey.
