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10 Stocks to Invest In According to Bart Baum’s Ionic Capital

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·10 min read
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In this article, we discuss 10 stocks to invest in according to Bart Baum's Ionic Capital. If you want to skip our detailed analysis of Baum's history, investment philosophy, and hedge fund performance, go directly to 5 Stocks to Invest In According to Bart Baum's Ionic Capital.

Bart Baum holds a bachelor's degree in political science from SUNY Albany and a master's degree in business administration from Fordham University. In September 1992, he began working at Highbridge. He was a managing director and portfolio manager in the US and European Volatility and Credit Arbitrage Group at Highbridge Capital Management LLC. Bart Baum designed and implemented several of Highbridge's stock arbitrage trading techniques, focusing on equity options, warrants, and obligatory convertibles. In addition, Bart Baum has overseen relative value arbitrage techniques in a wide range of asset classes worldwide.

Ionic Capital, founded by Bart Baum, Dan Stone, and Adam Radosti in 2006, is based in New York City. Ionic Capital is an event-driven hedge fund with about $2 billion in assets under management. It is a global investor in public stock, fixed income, and alternative investments. Ionic Capital declared $785.73 million in long stock positions in its Q4 2021 13F filings, with a top ten holdings concentration of 23.68%.

Bart Baum likes to diversify his investments. His hedge fund focuses on small and large businesses with solid fundamentals and the ability to develop in the future. Among them are Merck & Co., Inc. (NYSE:MRK), Uber Technologies, Inc. (NYSE:UBER), and Walmart Inc. (NYSE:WMT).

Based on the 13F holdings for the fourth quarter of 2021, Ionic Capital owns 3,530 shares in Merck & Co., Inc. (NYSE:MRK). Before the company's Q4 results, JPMorgan analyst Chris Schott decreased his price target on Merck & Co., Inc. (NYSE:MRK) to $95 from $100 on January 28 and maintained an Overweight rating on the stock, stating that he did not foresee any big surprises with the company's 2022 outlook.

10 Stocks to Invest In According to Bart Baum's Ionic Capital
10 Stocks to Invest In According to Bart Baum's Ionic Capital

Bart Baum of Ionic Capital Management

Another notable stock in Bart Baum's portfolio is Uber Technologies, Inc. (NYSE:UBER). The investor owns a $943,000 stake in the company. However, Wedbush analyst Ygal Arounian decreased his price objective on Uber Technologies, Inc. (NYSE:UBER) to $48 from $57 on February 14 and maintained an Outperform rating on the stock. The midpoint of total bookings of $170 billion, according to Arounian, was in line with consensus expectations for 2024, while adjusted EBITDA was below the consensus estimate of $5.7 billion.

Ionic Capital added Walmart Inc. (NYSE:WMT) to its portfolio in the fourth quarter by buying 1,917 shares. On February 17, Walmart Inc. (NYSE:WMT) announced a quarterly dividend of $0.56 per share, up 1.8% from the previous distribution of $0.55 per share.

Our Methodology

With this economic outlook in mind, let’s start our list of 10 stocks to invest in according to Bart Baum's Ionic Capital. We used Baum's 13F portfolio for Q4 2021 for this analysis.

Stocks to Invest In According to Bart Baum's Ionic Capital

10. Hertz Global Holdings, Inc. (NASDAQ:HTZ)

Ionic Capital Stake Value: $6,188,000

Percentage of Ionic Capital's 13F Portfolio: 0.78%

Number of Hedge Fund Holders: 55

Hertz Global Holdings, Inc. (NASDAQ:HTZ) is a vehicle rental company that operates in the United States. Hertz Global Holdings, Inc. (NASDAQ:HTZ) is a new arrival in Bart Baum's portfolio, as his hedge fund bought about 248,620 shares of the company, worth $6.19 million.

On January 20, Barclays analyst Brian Johnson decreased his price objective on Hertz Global Holdings, Inc. (NASDAQ:HTZ) from $28 to $26 and maintained an Overweight rating. The analyst lowered his predictions somewhat, indicating "what now may be the peak for earnings revisions, near term, in the rental car space."

Overall, 55 hedge funds monitored by Insider Monkey were bullish on Hertz Global Holdings, Inc. (NASDAQ:HTZ) in the fourth quarter of 2021. The stakes of these funds totalled $7.10 billion. Tom Wagner and Ara Cohen's Knighthead Capital is the most significant stakeholder of Hertz Global Holdings, Inc. (NASDAQ:HTZ), with 181.46 million shares worth $4.53 billion.

Like Hertz Global Holdings, Inc. (NASDAQ:HTZ), Ionic Capital holds significant shares in Merck & Co., Inc. (NYSE:MRK), Uber Technologies, Inc. (NYSE:UBER), and Walmart Inc. (NYSE:WMT).

9. Capri Holdings Limited (NYSE:CPRI)

Ionic Capital Stake Value: $7,241,000

Percentage of Ionic Capital's 13F Portfolio: 0.92%

Number of Hedge Fund Holders: 43

Capri Holdings Limited (NYSE:CPRI) is a British Virgin Islands-based global fashion holding company with executive headquarters in London and operating offices in New York. After Capri Holdings Limited (NYSE:CPRI)'s Q4 earnings beat and above-consensus outlook, MKM Partners analyst Roxanne Meyer boosted her price objective on Capri Holdings Limited (NYSE:CPRI) to $93 from $85 and maintained a Buy rating on the stock on February 3.

On February 2, Capri Holdings Limited (NYSE:CPRI) posted earnings for the fourth quarter of 2021. It reported earnings per share of $2.22, beating market predictions by $0.53. Revenue for the period was over $1.61 billion, above the analysts’ expectations by $140 million.

In the fourth quarter of 2021, 43 hedge funds in Insider Monkey's database held stakes in Capri Holdings Limited (NYSE:CPRI), a decrease compared to 46 funds in the preceding quarter.

Alger, an investment management firm, in its fourth quarter 2021 investor letter mentioned Capri Holdings Limited (NYSE:CPRI). Here is what the fund said:

“Capri Holdings is a global fashion luxury group consisting of three brands: Michael Kors, accounting for 72% of fiscal year 2021 sales, Jimmy Choo, accounting for 10% of sales, and Versace, accounting for 18% of sales. The brands cover various fashion categories, including women’s and men’s accessories, footwear, ready-to-wear, wearable technology, watches, jewelry, eyewear and fragrance products. Capri mainly operates within the $70 billion accessories segment of the global luxury market, which is growing 5% to 6% annually. Capri shares outperformed in the last three months of 2021 after the company reported strong results for the fiscal quarter ended September 25. Revenue, margins and earnings per share all beat management’s internal expectations, and the company raised its fiscal year 2022 outlook for all three brands, despite supply chain pressure. Capri also approved a new two-year share repurchase program of up to $1 billion, replacing its existing $500 million program, which had $250 million of availability remaining.”

8. Starz Acquisition LLC (NASDAQ:STRZA)

Ionic Capital Stake Value: $7,771,000

Percentage of Ionic Capital's 13F Portfolio: 0.98%

Number of Hedge Fund Holders: 16

Starz Acquisition LLC (NASDAQ:STRZA) is a media and entertainment firm based in Colorado. Out of the hedge funds being tracked by Insider Monkey, Warren Buffett’s Berkshire Hathaway is a leading shareholder of Starz Acquisition LLC (NASDAQ:STRZA), with 43.21 million shares worth more than $2.20 billion.

Lions Gate Entertainment Corp. (NYSE:LGF-A) paid $4.4 billion for Starz Acquisition LLC (NASDAQ:STRZA) to strengthen its position in the premium scripted television market and expand its global distribution reach. On December 14, Macquarie analyst Tim Nollen downgraded Lions Gate Entertainment Corp. (NYSE:LGF-A) from Outperform to Neutral, with a $17 price target, down from $20. As the streaming battles raged across the world, he warned investors that he was more suspicious of network media.

The hedge fund managed by Bart Baum owns 152,828 shares in Starz Acquisition LLC (NASDAQ:STRZA) worth over $7.77 million, representing close to 0.98% of its portfolio. In addition, Ionic Capital increased its stake in the firm by 20% in the fourth quarter of 2021.

7. Lucid Group, Inc. (NASDAQ:LCID)

Ionic Capital Stake Value: $8,944,000

Percentage of Ionic Capital's 13F Portfolio: 1.13%

Number of Hedge Fund Holders: 14

Lucid Group, Inc. (NASDAQ:LCID) is an electric car manufacturer. It develops, manufactures, and sells energy storage solutions for electric cars and the battery packs that power hybrid, plug-in, and electric automobiles. Lucid Group (NASDAQ:LCID) announced its newest studio location in New Jersey on February 17. This is the 22nd store in the company's expanding North American retail network.

On January 11, Redburn analyst Charles Coldicott initiated coverage of Lucid Group, Inc. (NASDAQ:LCID), rating the stock as Neutral. Lucid Group, Inc. (NASDAQ:LCID) recently saw a decrease in hedge fund sentiment. The number of long hedge fund positions declined to 14 at the end of the fourth quarter, compared to 18 positions in the previous quarter.

Lucid Group, Inc. (NASDAQ:LCID) is one of the latest acquisitions of Ionic Capital in Q4 2021. The hedge fund held shares worth over $8.94 million in Lucid Group, Inc. (NASDAQ:LCID), representing 1.13% of its 13F portfolio.

6. DXC Technology Company (NYSE:DXC)

Ionic Capital Stake Value: $9,369,000

Percentage of Ionic Capital's 13F Portfolio: 1.19%

Number of Hedge Fund Holders: 27

DXC Technology Company (NYSE:DXC) is a company that specializes in technology consulting, outsourcing, and support. On February 3, Cowen analyst Bryan Bergin reduced his price target on DXC Technology Company (NYSE:DXC) from $50 to $45 and maintained an Outperform rating. The analyst said shares were considerably undervalued, but improved performance supported more optimism.

In the fourth quarter of 2021, Insider Monkey identified 27 hedge funds with stakes in DXC Technology Company (NYSE:DXC). The total value of these stakes was over $447.82 million. Harris Associates is the biggest stakeholder of DXC Technology Company (NYSE:DXC), with 10.42 million shares worth $335.37 million.

For Q4 2021, DXC Technology Company (NYSE:DXC) reported an EPS of $0.92 on February 2, beating estimates by $0.01. However, DXC Technology Company (NYSE:DXC)’s revenue for the quarter came in at $4.09 billion, missing the market estimates by $10 million.

Just like Merck & Co., Inc. (NYSE:MRK), Uber Technologies, Inc. (NYSE:UBER), and Walmart Inc. (NYSE:WMT), DXC Technology Company (NYSE:DXC) is a notable stock in Bart Baum's Ionic Capital as of Q4 2021.

Miller Value Partners in its second quarter 2021 Investor Letter, mentioned DXC Technology Company (NYSE:DXC). Here is what the fund said:

“DXC Technology Company (DXC) continued to climb higher during the quarter gaining 24.57%. The company reported solid Fiscal Year 4th quarter (FY4Q) results with revenue of $4.385B beating consensus of $4.29B and earnings per share (EPS) of $0.74 ahead of expectations for $0.70. The company guided for fiscal 2022 revenue of $16.6-$16.8B, below the Street at $16.9B and adjusted EPS of $3.45-3.65, ahead of the consensus of $3.43. By FY2024, the company expects organic revenue growth of 1-3%, adjusted earnings before income and taxes (EBIT) margin of 10-11%, adjusted diluted EPS of $5.00-$5.25 and free cash flow (FCF) of $1.5B. Later in the month, the company held an investor day where management highlighted their confidence that they can hit all of their targets while also stressing the progress they have made on their turnaround to date.”

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Disclosure: None. 10 Stocks to Invest In According to Bart Baum's Ionic Capital is originally published on Insider Monkey.