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Richard Pzena’s 9 New Stock Picks

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·6 min read
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In this article, we discuss Richard Pzena’s 9 new stock picks. You can skip our comprehensive analysis of Pzena’s history, investment philosophy, and hedge fund performance, and go directly to Richard Pzena's 5 New Stock Picks.

Richard Pzena founded Pzena Investment Management in 1995, and he serves as the managing principal, co-chief investment officer, and portfolio manager for the firm. He single-handedly constructed the firm’s robust investment strategy and proprietary screening model upon inception.

Richard Pzena completed his Bachelor’s and MBA from Wharton School at the University of Pennsylvania in 1980. He previously worked at Amoco Corporation in financial and planning roles. After Amoco Corporation, Richard Pzena joined Sanford C. Bernstein, where he worked in multiple positions over the course of his tenure, including director of the U.S. equity investments, chief research officer, chief investment officer of small-cap equities, and oil industry analyst.

Pzena’s investment portfolio is concentrated in utilities and telecommunications, information technology, industrials, healthcare, finance, energy, and communications sectors. The top 10 holdings comprise 33.74% of the investment portfolio at Pzena Capital Management.

General Electric Company (NYSE:GE), Exxon Mobil Corporation (NYSE:XOM), Wells Fargo & Company (NYSE:WFC), and Ford Motor Company (NYSE:F) are some of the most popular stocks in Pzena’s Q2 2021 portfolio.

Richard Pzena's 9 New Stock Picks
Richard Pzena's 9 New Stock Picks

Richard S. Pzena of Pzena Investment Management

Why pay attention to hedge fund sentiment while choosing stocks?

Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 86 percentage points since March 2017. Between March 2017 and July 2021, our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY. Our stock picks outperformed the market by more than 86 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.

Our Methodology

With this context in mind, let’s discuss Richard Pzena’s 9 new stock picks.

Pzena's fund initiated new stakes in these companies in the second quarter.

Richard Pzena's New Stock Picks

9. Nokia Corporation (NYSE:NOK)

Pzena Investment Management’s Stake Value: $86,000

Number of Hedge Fund Holders: 26

Nokia Corporation (NYSE:NOK) is a Finnish multinational company dealing in telecommunications, information technology, and consumer electronics, since its inception in 1865. Nokia Corporation (NYSE:NOK) was the largest mobile phone and smartphone vendor in the world from 1998 to 2002, but suffered in that category afterwards. Nokia Corporation (NYSE:NOK) sold its mobile manufacturing division to Microsoft Corporation (NASDAQ:MSFT) in 2014, and shifted its focus on telecommunications infrastructure, IoT, virtual reality, and digital health via strategic acquisitions. Nokia Corporation (NYSE:NOK) remains a key patent licensor for most big mobile phone vendors to date.

Pzena Investment Management holds an $86,000 stake in Nokia Corporation (NYSE:NOK) as of the end of June, and it is one of the newest stock picks by Richard Pzena.

Arrow Street Capital is the leading stakeholder in Nokia Corporation (NYSE:NOK), with stakes worth $133.1 million. Overall, 26 hedge funds were long Nokia Corporation (NYSE:NOK) at the end of June, up from 21 in the previous quarter.

On October 18, it was announced that Nokia Corporation (NYSE:NOK) will provide the equipment for 5G coverage in Slovenia, to businesses and customers alike from its AirSpace 5G equipment portfolio. Similarly, it was reported on October 14 that Nokia Corporation (NYSE:NOK) would deploy 5G coverage to Japanese companies, SoftBank Group Corp. (OTC:SFTBY) and KDDI, thus enhancing the company’s global footprint.

Nokia Corporation (NYSE:NOK) is a good stock to purchase according to Richard Pzena, much like General Electric Company (NYSE:GE), Exxon Mobil Corporation (NYSE:XOM), Wells Fargo & Company (NYSE:WFC), and Ford Motor Company (NYSE:F).

8. Jazz Pharmaceuticals plc (NASDAQ:JAZZ)

Pzena Investment Management’s Stake Value: $275,000

Number of Hedge Fund Holders: 34

Next, we have Jazz Pharmaceuticals plc (NASDAQ:JAZZ) on our list of Richard Pzena’s 9 new stock picks. Jazz Pharmaceuticals plc (NASDAQ:JAZZ) is an Irish biopharmaceutical company which focuses on developing medical drugs for deadly diseases, to transform the lives of critical patients for the better. Their medical expertise extends to sleep disorders, oncology, neuroscience, solid tumors, and epilepsy. Their medicines are available in 75 countries, and Jazz Pharmaceuticals plc (NASDAQ:JAZZ)’s clinical trials are thoroughly focused on oncology and neuroscience.

Pzena Investment Management owns 1,546 shares in Jazz Pharmaceuticals plc (NASDAQ:JAZZ), valued at $275,000.

Akash Tewari at Jefferies assumed coverage of Jazz Pharmaceuticals plc (NASDAQ:JAZZ) with a Buy rating, setting a price target of $172 on October 6. He stated that the biopharmaceutical company had a strong and attractive valuation, and the solid IP on Epidiolex definitely contributed towards the rating.

Of the 873 hedge funds tracked by Insider Monkey, 34 held stakes in Jazz Pharmaceuticals plc (NASDAQ:JAZZ) at the end of the second quarter, down from 37 in Q1. The company’s largest stakeholder is Aubrey Capital Management, with a $498.2 million stake in Jazz Pharmaceuticals plc (NASDAQ:JAZZ).

Jazz Pharmaceuticals plc (NASDAQ:JAZZ) is a suitable investment opportunity according to Richard Pzena, just like General Electric Company (NYSE:GE), Exxon Mobil Corporation (NYSE:XOM), Wells Fargo & Company (NYSE:WFC), and Ford Motor Company (NYSE:F).

7. United Therapeutics Corporation (NASDAQ:UTHR)

Pzena Investment Management’s Stake Value: $412,000

Number of Hedge Fund Holders: 45

Another stock on our list of Richard Pzena’s 9 new stock picks is United Therapeutics Corporation (NASDAQ:UTHR), which is an American biotech company aiming to offer life-extending technology in the fields of lung disease and organ manufacturing. The drugs and therapies by United Therapeutics Corporation (NASDAQ:UTHR) have received several FDA approvals in the United States, and the company’s medical products are sold in the US, Canada, Central and South America, Middle East, and Asia.

Richard Pzena owns 2,296 shares in United Therapeutics Corporation (NASDAQ:UTHR), worth $412,000. The leading stakeholder in the biotech corporation is Jim Simons’ Renaissance Technologies, holding 3.1 million shares valued at $557.9 million.

Insider Monkey tracks the movement of 873 elite hedge funds diligently, and at the end of June, 45 funds were bullish on United Therapeutics Corporation (NASDAQ:UTHR), up from 42 in the first quarter.

6. Qorvo, Inc. (NASDAQ:QRVO)

Pzena Investment Management’s Stake Value: $444,000

Number of Hedge Fund Holders: 40

Qorvo, Inc. (NASDAQ:QRVO) is the next stock on our list of Richard Pzena’s 9 new stock picks. Qorvo, Inc. (NASDAQ:QRVO) is an American semiconductor company that designs and manufactures radio frequency systems for apps that use wireless and broadband communications, in addition to foundry services. The North Carolina-based company was formed as a result of a merger between TriQuint Semiconductor and RF Micro Devices in 2015. Qorvo, Inc. (NASDAQ:QRVO) is traded as a S&P 500 Component.

Richard Pzena holds a stake valued at $444,000 in Qorvo, Inc. (NASDAQ:QRVO) as of the second quarter. Seth Klarman’s Baupost Group holds stakes worth $1.04 billion in Qorvo, Inc. (NASDAQ:QRVO), making him the largest stakeholder of the semiconductor company.

At the end of the second quarter, 40 hedge funds tracked by Insider Monkey were long Qorvo, Inc. (NASDAQ:QRVO), down from 41 in the previous quarter.

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Disclosure: None. Richard Pzena's 9 New Stock Picks is originally published on Insider Monkey.