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10 Stocks to Buy According to David Fear’s Thunderbird Partners

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·10 min read
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In this article, we discuss 10 stocks to buy according to David Fear’s Thunderbird Partners. If you want to skip our detailed analysis of these stocks, go directly to 5 Stocks to Buy According to David Fear's Thunderbird Partners.

Thunderbird Partners is a London-based hedge fund which manages a portfolio worth $834.3 million as of September 2021, with investments focused on the finance, information technology, consumer discretionary, and communications sectors. The hedge fund has a top 10 holdings concentration of 95.97%.

Thunderbird Partners was launched by David Fear, who previously ran a London-based hedge fund for the billionaire Ziff brothers.

The hedge fund’s top buys for the third quarter included Twitter, Inc. (NYSE:TWTR), Spotify Technology S.A. (NYSE:SPOT), and Airbnb, Inc. (NASDAQ:ABNB). Whereas, Thunderbird Partners sold out of JPMorgan Chase & Co. (NYSE:JPM), Bank of America Corporation (NYSE:BAC), and Kirby Corporation (NYSE:KEX).

The most notable stocks in the Q3 portfolio of David Fear's Thunderbird Partners include Meta Platforms, Inc. (NASDAQ:FB), Alphabet Inc. (NASDAQ:GOOG), and Alibaba Group Holding Limited (NYSE:BABA).

10 Stocks to Buy According to David Fear's Thunderbird Partners
10 Stocks to Buy According to David Fear's Thunderbird Partners

Source:Pixabay

Our Methodology

We used the Q3 portfolio of David Fear's Thunderbird Partners to enlist the hedge fund’s top 10 stock picks, ranking them according to the fund’s stake value in each holding.

For further context on each stock, we have mentioned Q3 earnings, analyst ratings, and the hedge fund sentiment around the holdings.

Stocks to Buy According to David Fear's Thunderbird Partners

10. Airbnb, Inc. (NASDAQ:ABNB)

Thunderbird Partners’ Stake Value: $17,215,000

Percentage of Thunderbird Partners’ 13F Portfolio: 2.06%

Number of Hedge Fund Holders: 58

Airbnb, Inc. (NASDAQ:ABNB), an American vacation rental company running an online marketplace for lodging and tourism activities, is one of the top stocks to buy according to David Fear’s Thunderbird Partners. The hedge fund owns 102,625 Airbnb, Inc. (NASDAQ:ABNB) shares as of Q3 2021, worth $17.2 million, representing 2.06% of the total 13F securities.

On November 4, Airbnb, Inc. (NASDAQ:ABNB) posted its Q3 results, announcing earnings per share of $1.23, beating estimates by $0.40. The quarterly revenue equaled $2.24 billion, outperforming estimates by $181.63 million.

Piper Sandler analyst Thomas Champion downgraded Airbnb, Inc. (NASDAQ:ABNB) on January 10 to Neutral from Overweight with a price target of $169, down from $215. While Airbnb, Inc. (NASDAQ:ABNB) remains a "top-tier asset", the stock's setup looks less favorable into 2022. He cites "elevated" Street expectations, valuation, and its "alternatives pure-play focus", which may be less desirable as travel normalizes, for the downgrade.

A total of 58 hedge funds were bullish on Airbnb, Inc. (NASDAQ:ABNB) as of September 2021, with stakes valued at $2.71 billion. Renaissance Technologies, one of the largest Airbnb, Inc. (NASDAQ:ABNB) stakeholders, elevated its position in the company by 294% in the third quarter, holding 2.7 million shares worth $465.3 million.

In addition to Meta Platforms, Inc. (NASDAQ:FB), Alphabet Inc. (NASDAQ:GOOG), and Alibaba Group Holding Limited (NYSE:BABA), Airbnb, Inc. (NASDAQ:ABNB) is a notable stock from Thunderbird Partners' Q3 portfolio.

Here is what Tollymore Investment Partners has to say about Airbnb, Inc. (NASDAQ:ABNB) in its Q3 2021 investor letter:

“Today disruptors are not typically seeking to replace incumbents entirely. Rather, they break the links in the customer journey, in doing so better aligning monetisation with value creation and minimizing externalities. For example, Airbnb broke the link between staying in residential property and owning it. Airbnb is a specific example of a business model innovation which separated asset use from ownership. This is hardly a novel idea; it’s called renting. Rental models lend themselves to assets which are expensive and durable, and where usage is infrequent.”

9. Harley-Davidson, Inc. (NYSE:HOG)

Thunderbird Partners’ Stake Value: $53,814,000

Percentage of Thunderbird Partners’ 13F Portfolio: 6.44%

Number of Hedge Fund Holders: 33

Harley-Davidson, Inc. (NYSE:HOG) is an American motorcycle manufacturer headquartered in Milwaukee, Wisconsin, selling its products and merchandise worldwide. Thunderbird Partners owns 1.4 million Harley-Davidson, Inc. (NYSE:HOG) shares as of September 2021, worth $53.8 million, representing 6.44% of the fund’s Q3 portfolio.

On November 22, Harley-Davidson, Inc. (NYSE:HOG) declared a quarterly per share dividend of $0.15. The dividend was paid on December 23, to shareholders of record on December 8.

Harley-Davidson, Inc. (NYSE:HOG) announced on October 27 its Q3 results, posting earnings per share of $1.18, exceeding estimates by $0.42. Revenue over the period totaled $1.16 billion, up 20.39% year-over-year, beating estimates by $14.21 million.

BMO Capital analyst Gerrick Johnson raised the price target on Harley-Davidson, Inc. (NYSE:HOG) to $62 from $54 and kept an Outperform rating on the shares on October 28. The company's Q3 results were better than expected, with retail sales, motorcycle shipment, and financial services performance all ahead of estimates.

Rehan Jaffer’s H Partners Management is the largest Harley-Davidson, Inc. (NYSE:HOG) stakeholder as of Q3 2021, with 11.20 million shares worth roughly $410 million. Overall, 33 hedge funds in the third quarter database of Insider Monkey were bullish on the stock, down from 37 funds in the prior quarter.

8. Interactive Brokers Group, Inc. (NASDAQ:IBKR)

Thunderbird Partners’ Stake Value: $56,896,000

Percentage of Thunderbird Partners’ 13F Portfolio: 6.81%

Number of Hedge Fund Holders: 31

Interactive Brokers Group, Inc. (NASDAQ:IBKR), an American multinational company offering online brokerage and direct market access to stocks, options, futures, forex, bonds, and ETFs, is one of the top stocks to buy according to Thunderbird Partners. The hedge fund holds 912,676 Interactive Brokers Group, Inc. (NASDAQ:IBKR) shares, worth $56.8 million. The stock represents 6.81% of Thunderbird Partners’ Q3 portfolio.

On October 19, Interactive Brokers Group, Inc. (NASDAQ:IBKR) declared a $0.10 per share quarterly dividend, in line with previous. The dividend was paid on December 14, to shareholders of record on December 1.

Interactive Brokers Group, Inc. (NASDAQ:IBKR) posted Q3 earnings on October 19, reporting an EPS of $0.78, beating estimates by $0.02. The $464 million revenue dropped 15.33% from the prior-year quarter, missing estimates by $175.82 million.

BofA analyst Craig Siegenthaler initiated coverage of Interactive Brokers Group, Inc. (NASDAQ:IBKR) with a Buy rating and a $126 price target on December 15. The analyst said that the company has a "key" competitive advantage in technology research and development, which allows the firm to launch new capabilities faster and at lower price points than peers.

In the third quarter of 2021, 31 hedge funds were bullish on Interactive Brokers Group, Inc. (NASDAQ:IBKR), down from 36 funds in the preceding quarter. Select Equity Group is the leading stakeholder of the company, with 5.79 million shares worth $361.3 million.

7. Twitter, Inc. (NYSE:TWTR)

Thunderbird Partners’ Stake Value: $57,893,000

Percentage of Thunderbird Partners’ 13F Portfolio: 6.93%

Number of Hedge Fund Holders: 94

Thunderbird Partners acquired a stake in Twitter, Inc. (NYSE:TWTR) during the third quarter of 2021, buying 958,659 shares worth $57.8 million. The stock accounts for 6.93% of the fund’s total 13F portfolio.

On October 26, Twitter, Inc. (NYSE:TWTR) reported its third quarter financial results, posting a per share loss of $0.54, missing estimates by $0.72. Revenue over the period jumped 37.13% year-over-year to $1.28 billion, outperforming estimates by $1.02 million.

Truist analyst Youssef Squali lowered the price target on Twitter, Inc. (NYSE:TWTR) to $60 from $80 but kept a Buy rating on the shares on January 10. The analyst cites his updated model following the sale of MoPub and the expected increase in operating spending under the company's new CEO. The sharp pullback and the compelling long-term story makes Twitter, Inc. (NYSE:TWTR) "attractive" for patient investors.

Stephen Mandel’s Lone Pine Capital is the biggest Twitter, Inc. (NYSE:TWTR) stakeholder as of September 2021, holding 21.5 million shares worth $1.30 billion. Overall, 94 hedge funds monitored by Insider Monkey were long Twitter, Inc. (NYSE:TWTR) during the third quarter, with stakes totaling $6.30 billion.

Here is what Greenwood Investors has to say about Twitter, Inc. (NYSE:TWTR) in its Q3 2021 investor letter:

“Being entrepreneurial, by definition, means taking the path untraveled, and heading into the unknown with daring boldness. Offense playbooks, by design, must take competition by surprise. Coming from a humble place with brands and companies that were ridiculed by competitors, when Sergio put medium-term plans out to the market, they were not timid. He would always aim higher than anyone, especially his competitors, believed he and his team could reach. And while not every target was always achieved, the formidable results speak for themselves.

This past earnings season, as Twitter was the only social media company to deliver on guidance while also confirming the quarter ahead to be at least as good, the stock sold off materially as its monetizable daily active user (MDAU) targets in the medium-term were called into question. While founder Jack Dorsey is clearly unafraid to look foolish to the public, or even in front of congress, he also manages multiple businesses at the same time. Competitors openly make fun of him. But his team is exceptionally loyal to him, and they have set out very ambitious targets for themselves over the next few years. The recent sell-off in Twitter shares was like deja vu all over again, as I reminisced about the Fiat capital markets day in 2014, fittingly on Twitter in this tweet thread. With its product and revenue servers rebuilt, it can now innovate and launch new ad formats faster than ever before. We look forward to the Twitter team pressing its offense strategy as a major peer loses focus on its core business.”

6. Six Flags Entertainment Corporation (NYSE:SIX)

Thunderbird Partners’ Stake Value: $74,536,000

Percentage of Thunderbird Partners’ 13F Portfolio: 8.93%

Number of Hedge Fund Holders: 42

Six Flags Entertainment Corporation (NYSE:SIX) is a Texas-based amusement park corporation with properties in Canada, Mexico, and the United States. Thunderbird Partners boosted its stake in Six Flags Entertainment Corporation (NYSE:SIX) by 62% in Q3 2021, holding a total of 1.75 million shares, worth $74.5 million. The stock represents 8.93% of the fund’s 13F securities.

On October 27, Six Flags Entertainment Corporation (NYSE:SIX) published its third quarter earnings. The company announced an EPS of $1.80, exceeding estimates by $0.36. The Q3 revenue came in at $638.28 million, gaining 405.26% from the prior-year quarter, outperforming estimates by $51.21 million.

Credit Suisse analyst Benjamin Chaiken upgraded Six Flags Entertainment Corporation (NYSE:SIX) to Outperform from Neutral with a price target of $53, up from $52. The shares offer a "compelling risk/reward" following the recent sell off, according to the analyst.

42 hedge funds tracked by Insider Monkey in the third quarter reported owning stakes in Six Flags Entertainment Corporation (NYSE:SIX), valued at over $1 billion, as compared to 36 funds holding stakes worth roughly $895 million in Six Flags Entertainment Corporation (NYSE:SIX) in the preceding quarter.

One of the largest stakeholders of Six Flags Entertainment Corporation (NYSE:SIX) as of Q3 2021 is billionaire Ken Griffin’s Citadel Investment Group, with 2.24 million shares worth $95.2 million.

Just like Meta Platforms, Inc. (NASDAQ:FB), Alphabet Inc. (NASDAQ:GOOG), and Alibaba Group Holding Limited (NYSE:BABA), Six Flags Entertainment Corporation (NYSE:SIX) is one of the top stocks from Thunderbird Partners' Q3 portfolio.

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Disclosure: None. 10 Stocks to Buy According to David Fear's Thunderbird Partners is originally published on Insider Monkey.