In this article, we discuss Dan Loeb’s long-term stock picks. If you want to skip our detailed analysis of Dan Loeb’s investment strategy and latest activist targets, head directly to Mr. Pink Dan Loeb's 5 Long-Term Stock Picks.
Dan Loeb, the founder and chief executive of Third Point, rose to fame during the dotcom crash by writing a series of confrontational letters to corporate executives he was in disagreement with. Even before that, between 1997 and 2003, Loeb actively participated in the Silicon Investor message boards under the alias "Mr. Pink." During his time there, he wrote more than 5,000 daring posts, frequently addressing himself in the third person as Mr. Pink, as well as "the Pinkster" and "PINK DADDY."
Loeb has established himself as one of the most talked-about activist investors on Wall Street, often making huge waves in the market with his campaigns. For example, in February 2023, Salesforce, Inc. (NYSE:CRM) was facing challenges such as sluggish growth and leadership changes, which attracted the attention of multiple activist investors. Third Point joinedElliott Investment Management, Starboard Value LP, ValueAct Capital Partners, and Inclusive Capital as investors in the company. To address the situation, Salesforce, Inc. (NYSE:CRM) appointed three new directors, including Mason Morfit from ValueAct, to join the board. Salesforce also announced job cuts and office space reductions in January 2023, after experiencing a significant decline in share value. Co-CEO Bret Taylor stepped down from his position at the end of January, ending the company's dual leadership experiment. Stewart Butterfield, the CEO of Slack Technologies, which Salesforce acquired for around $28 billion in 2021, also departed from the company around the time. To add to the chaotic environment, Salesforce went on a binge of acquisitions, completing 72 since 2006, a pace that some analysts and investors have criticized.
In the fiscal third quarter of 2022, Salesforce, Inc. (NYSE:CRM) reported a 14% year-over-year increase in sales. However, it was a decline compared to the 27% growth in the same quarter of 2021. CEO Marc Benioff expressed frustration with the company's slowdown and attributed it to execution issues as well as the broader economic upheaval. After reaching a peak in late 2021, Salesforce's stock experienced a significant drop, but it rallied due to the news of activist involvement and a boom in technology shares. Dan ‘Mr. Pink’ Loeb first invested in Salesforce back in the first quarter of 2017, only to discard the shares in the next quarter. He again bought a stake in the firm in Q1 2018 and held onto it for a while, before disposing of his shares entirely in Q1 2021. In the first quarter of 2023, Loeb once again carved a stake in Salesforce, following the activist interest in the company, buying 800,000 shares worth nearly $160 million.
Similarly, in March 2023, it was revealed that Dan Loeb had acquired a passive stake in Advanced Micro Devices, Inc. (NASDAQ:AMD). Loeb made this investment when AMD shares were struggling. Over the past year, Advanced Micro Devices, Inc. (NASDAQ:AMD) stock had performed worse compared to other companies in the sector, experiencing a decline of more than 30% while the PHLX Semiconductor Index dropped by 14%. Loeb is familiar with the chip industry as he had previously owned Intel, which is AMD's main competitor. Securities filings for Q1 2023 disclosed that Mr. Pink’s Third Point purchased 1 million shares of Advanced Micro Devices, Inc. (NASDAQ:AMD) worth $98 million, representing 1.6% of the total 13F portfolio.
In this article, we discuss Mr. Pink’s long-term stock picks, which include DuPont de Nemours, Inc. (NYSE:DD), Danaher Corporation (NYSE:DHR), and UnitedHealth Group Incorporated (NYSE:UNH).
Our Methodology
We selected the following stocks from the Q1 2023 portfolio of Dan Loeb’s Third Point. These stocks have been held by Loeb for one year or longer, making them his most prominent long-term holdings. The stocks are arranged in the ascending order of Third Point’s holding period.
Colgate-Palmolive Company (NYSE:CL) manufactures and sells consumer products worldwide. Dan Loeb added Colgate-Palmolive Company (NYSE:CL) to his portfolio in Q2 2022 by purchasing approximately 2 million shares worth $159,000. In the first quarter of 2023, Loeb owned 11.05 million shares worth $830.4 million. It is the second largest stock in Loeb’s Q1 2023 portfolio and he has held on to this position for a year.
On April 28, Colgate-Palmolive Company (NYSE:CL) reported a Q1 non-GAAP EPS of $0.73 and a revenue of $4.77 billion, outperforming Wall Street estimates by $0.03 and $190 million, respectively. Organic sales rose by 10.0% in Q1 2023, experiencing growth across all divisions.
According to Insider Monkey’s first quarter database, 55 hedge funds were bullish on Colgate-Palmolive Company (NYSE:CL), compared to 61 funds in the prior quarter. Jean-Marie Eveillard’s First Eagle Investment Management is the largest stakeholder of the company, with 11 million shares worth $833.5 million.
In addition to DuPont de Nemours, Inc. (NYSE:DD), Danaher Corporation (NYSE:DHR), and UnitedHealth Group Incorporated (NYSE:UNH), Colgate-Palmolive Company (NYSE:CL) is one of the top long-term stock picks of Dan ‘Mr. Pink’ Loeb.
Third Point made the following comment about Colgate-Palmolive Company (NYSE:CL) in its Q4 2022 investor letter:
“Colgate-Palmolive Company (NYSE:CL) remains one of the firm’s largest equity positions. The company offers defensive growth at a reasonable valuation, and we continue to see the potential for shares to deliver attractive risk adjusted returns over the next several years.
Aurora Innovation, Inc. (NASDAQ:AUR) is an American self-driving technology company that specializes in developing the Aurora Driver platform. This platform combines various hardware, software, and data services to enable self-driving capabilities in passenger vehicles, light commercial vehicles, and trucks. It is one of the long-term stocks picks of Mr. Pink. Securities filings for Q1 2023 reveal that Loeb’s Third Point held 1.03 million shares worth $1.4 million. The stock has been part of the Third Point portfolio for 1 year and 6 months.
On April 6, Aurora Innovation, Inc. (NASDAQ:AUR) filed a prospectus with the SEC for a mixed shelf offering with the aim of raising $350 million. The company plans to offer different securities such as class A common stock, preferred stock, debt securities, depositary shares, warrants, subscription rights, purchase contracts, and units as part of this offering.
According to Insider Monkey’s first quarter database, 21 hedge funds were bullish on Aurora Innovation, Inc. (NASDAQ:AUR), compared to 18 funds in the prior quarter.
Logistics Innovation Technologies Corp. (NASDAQ:LITTW) is a special purpose acquisition company (SPAC) that aims to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. As of now, the company has not identified a specific target for this business combination.
Logistics Innovation Technologies Corp. (NASDAQ:LITTW) has been part of Dan Loeb’s portfolio for 1 year and 6 months. He owned 1 million shares of Logistics Innovation Technologies Corp. (NASDAQ:LITTW) worth $10.15 million in the first quarter of 2023.
According to Insider Monkey’s first quarter database, Phill Gross and Robert Atchinson’s Adage Capital Management is the largest stakeholder of the company, with 2.40 million shares worth $24.3 million.
EG Acquisition Corp. (NYSE:EGGF) is a New York-based blank check company that was established with the intention of pursuing a business combination through mergers, stock exchanges, asset acquisitions, stock purchases, or reorganizations. The company was incorporated in 2021. Dan Loeb has held onto his stake in EG Acquisition Corp. (NYSE:EGGF) for one and a half years. In Q1 2023, Mr. Pink owned 1.10 million shares of the company worth $11.2 million.
According to Insider Monkey’s first quarter database, Boaz Weinstein’s Saba Capital is the largest stakeholder of EG Acquisition Corp. (NYSE:EGGF), with 1.7 million shares worth $17.5 million.
9. Rice Acquisition Corp. II WT (NYSE:RONI-WT)
Number of Hedge Fund Holders: N/A
Third Point’s Stake Value: $15,352,500
Third Point’s Holding Period: 1 year 6 months
Rice Acquisition Corp. II WT (NYSE:RONI-WT) is a publicly traded special purpose acquisition company that specializes in merging with private companies dedicated to decarbonizing natural gas and related infrastructure. On June 9, 2023, Rice Acquisition Corp. II WT (NYSE:RONI-WT) successfully completed its business combination with NET Power Inc. (NYSE:NPWR), aiming to develop clean power generation from natural gas.
Securities filings for the first quarter of 2023 reveal that Dan Loeb’s Third Point owned 1.50 million shares of Rice Acquisition Corp. II WT (NYSE:RONI-WT) worth $15.3 million, representing 0.25% of the 13F securities. The stock has been part of the Third Point portfolio for one and a half years.
Blue Whale Acquisition Corp I (NASDAQ:BWC) is a blank check company that aims to form a merger, capital share exchange, asset acquisition, share purchase, reorganization, or similar business combination with one or more businesses. The company does not have significant operations right now. Blue Whale Acquisition Corp I (NASDAQ:BWC)’s primary focus is on identifying businesses that operate within the media, entertainment, and technology sectors.
Securities filings for the first quarter of 2023 reveal that Dan Loeb’s Third Point held 2 million shares of Blue Whale Acquisition Corp I (NASDAQ:BWC) worth approximately $20 million, representing 0.31% of the total 13F portfolio. The stock has been in Dan Loeb’s portfolio for a year and a half.
According to Insider Monkey’s first quarter database, MIC Capital Partners is a prominent stakeholder of Blue Whale Acquisition Corp I (NASDAQ:BWC), with a position worth $18.9 million.
Hertz Global Holdings, Inc. (NASDAQ:HTZ) operates as a vehicle rental business, with its operations divided into two main segments – Americas Rental Car and International Rental Car. Hertz Global Holdings, Inc. (NASDAQ:HTZ) has been in Third Point’s portfolio for one and a half years. In Q1 2023, Loeb raised his stake in the company by 19%, holding 6.35 million shares worth $103.4 million. It is one of Loeb’s top long-term picks.
On July 5, Jefferies analyst Stephanie Moore initiated coverage of Hertz Global Holdings, Inc. (NASDAQ:HTZ) with a Buy rating and a price target of $24. The analyst provided a bullish outlook on Hertz, anticipating that pricing and margins would increase significantly compared to pre-COVID levels. The analyst also expected an increase in revenue from the Uber-Tesla partnership, which could further enhance margins.
According to Insider Monkey’s first quarter database, Hertz Global Holdings, Inc. (NASDAQ:HTZ) was part of 45 hedge fund portfolios, compared to 44 funds in the prior quarter. Tom Wagner and Ara Cohen’s Knighthead Capital is the leading stakeholder of the company, with 181.4 million shares worth approximately $3 billion.
Khosla Ventures Acquisition Co. (NASDAQ:KVSA) is a special purpose acquisition company with no significant operations as of now. It was incorporated in 2021 and is based in Menlo Park, California. Khosla Ventures Acquisition Co. (NASDAQ:KVSA) has been part of Dan Loeb’s portfolio for 2 years and 3 months. The billionaire owns 2 million shares of the company worth $20.3 million as of the first quarter of 2023.
According to Insider Monkey’s first quarter database, Robert Henry Lynch’s Aristeia Capital is the largest stakeholder of Khosla Ventures Acquisition Co. (NASDAQ:KVSA), with 2.60 million shares worth $26.4 million.
Like DuPont de Nemours, Inc. (NYSE:DD), Danaher Corporation (NYSE:DHR), and UnitedHealth Group Incorporated (NYSE:UNH), Khosla Ventures Acquisition Co. (NASDAQ:KVSA) is one of Dan Loeb’s top long-term stock picks.
