TipRanks’ No.1 Hedge Fund Manager Bets on These Key Stocks

Tracking hedge funds is a popular investing strategy- especially as investors may assume that hedge fund managers carry out extremely detailed and careful analysis before investing in a particular stock. But while some hedge funds are driving impressive returns, other big-name fund managers have struggled in recent years to post returns that come in even above the S&P 500. Only recently, Eric Mindich announced the closure of his $7 billion Eton Park Capital Management, referring to industry headwinds and a difficult market environment. In these difficult times, how can investors find the top fund managers to follow?

That’s where TipRanks comes in. TipRanks tracks and ranks over 200 fund managers based on the fund’s trades, as revealed by 13F forms filed with the SEC. The Top 25 hedge fund managers page shows that the top performing hedge fund managers are not always the most well-known (think George Soros and Ray Dalio for example) but instead includes some perhaps less familiar names, such as the number 1 fund manager Brad Gerstner.

Gerstner manages the $1.95 billion Altimeter Capital Management fund, which generated an impressive return last year of 21.23%. This figure rises to a whopping 48.7% when calculated on a three-year annualized basis. The conclusion: if we want to know where the smartest money is going, Gerstner is definitely the one to track. In fact this services-focused fund has a measured performance over time of 242% vs just 82% for the S&P 500 and 48% for the average hedge fund portfolio.

So, bearing all this in mind, which top stocks is Gerstner bullish on? We compiled this list of five stocks based on his most recent trades.

Priceline (PCLN)- in Q4 Gerstner ramped up the fund’s holding in online travel booking company Priceline by 199% to 123,000 shares with a reported value of $180 million. In fact, since the last filing the holding (the third biggest in Altimeter’s portfolio) has already shot up in value by over 20%. Indeed, it’s not just Gerstner that is bullish on the stock- PCLN has a strong buy analyst consensus rating on TipRanks with no hold or sell ratings published on the stock in the last three months.

Tableau (DATA)- now the fourth biggest stock in the fund’s portfolio, Gerstner increased the fund’s holding of software company Tableau by 131% to 2.5 million shares valued at $109 million. Since the last filing date, prices have already improved by 15%. The stock has a moderate buy analyst consensus rating, with some analysts cautious about the competition posed to the company by heavyweights such as Google and Microsoft.

Amazon (AMZN)- Gerstner initiated a new position in ecommerce giant Amazon with the purchase of 50,000 shares valued at $37.5 million. Amazon is one of the best-rated stocks in TipRanks with 27 buy ratings published on the stock in the last three months (and only one hold rating). Five-star Stifel Nicolaus analyst Scott Devitt reiterated his buy rating on the stock on March 27 with a very bullish $1,025 price target (shares are currently at $856) saying: “Substantial retail spending dollars are likely to come up for grabs in the coming years from store closures and we believe a sizable share will shift online and to Amazon, the dominant player.” 

Netflix (NFLX)- in Q4, Gerstner upped the fund’s Netflix holding by just over 90% to 242,200 shares valued at close to $30 million. Since the last filing date these shares are already up by 17%. Top RBC Capital analyst Mark Mahaney calls Netflix his favorite stock for 2017 with “Millennials now spending more time on NFLX and a content algorithm that allows it “age in reverse” and improve the service with use.”

Twilio (TWLO)- Gerstner initiated a new position in cloud communications platform Twilio with the addition of 778,000 shares at $22.5 million. TWLO shares tanked from September to November last year as the market corrected the stock’s exaggerated valuation following its IPO in June, but prices have since plateaued at around $30. The analyst consensus rating remains strong buy.