Hedge fund managers gathered Wednesday at the 2024 Sohn Investment Conference in New York to share their best investment ideas. Sohn is one of the most anticipated hedge fund events of the year. It started with ‘Next Wave Sohn’, a session that featured the ideas of rising stars within the hedge fund industry. Here are their picks: Eric Wolff, Gumshoe Capital Management Investment idea: Pason Systems Energy company Pason Systems is a dominant supplier of EDR, or electronic drill recorder, solutions to the oil and gas industry, according to Eric Wolff, portfolio manager at Gumshoe Capital Beheer. Wolff sees between 45% and 180% benefit for Pason, which he estimates has between 60% and 85% of the market share in the Western world. “Pason provides a superior service that is difficult to duplicate. … We think this is an excellent company that deserves to trade at a healthier level than it is now,” Wolff said, adding that the company is trading at an oil and gas company. instead of a software rating. “We think this is a near-monopolistic business…even if the multiple doesn’t grow, we can get an 18% return over the cycle just based on the business calendar.” Shares are up about 4% this year and up more than 19% in the past month. Michelle Ross, StemPoint Capital Investment idea: Crinetics Pharmaceuticals One stock that could nearly double from now on strong interest in weight-loss drugs and an increased focus on endocrine health is Crinetics Pharmaceuticals, according to Michelle Ross, CIO at StemPoint Capital. The stock is up almost 33% year to date. Crinetics, which develops therapies for endocrine diseases, could capitalize on a potential billion-dollar market opportunity in the U.S. as it focuses on therapies for Cushing’s disease and congenital adrenal hyperplasia, Ross said. Endocrinology is an $8 billion market, but the cumulative market size, including the company’s future therapy targets, is more than $200 billion, including estimates for future obesity drugs, the investor said. She has a one-year price target of $88 for the stock, implying 92% upside potential, while her long-term price target of $339 suggests a whopping 665% upside potential for the company. Ross said she expects significant outperformance in the coming years, competing with companies like Eli Lilly and Novo Nordisk, as the “obesity market moves from an injectable to an oral pill.” Over the past three years, Crinetics has outperformed the SPDR S&P Biotech ETF (XBI) by 200%, she said. This year, Crinetics is up more than 31%, while XBI is up 1.8%. CRNX YTD Mountain Nikhil Daftary, NK Capital Investment Idea: Alimentation Couche-Tard A Canadian operator of global convenience stores represents a buying opportunity in an often overlooked sector, according to Nikhil Daftary, co-founder and partner at NK Capital. Alimentation Couche-Tard is publicly traded in Canada but makes most of its profits in the US, where it is the second-largest supermarket chain behind only 7-Eleven, Daftary said. It has a market capitalization of CA$75 billion with an “incredible track record”, the investor said. Furthermore, Daftary expects that scale gas stations will be a surprise beneficiary of the growth in electric vehicle usage. “We believe Couch-Tard is one of the biggest success stories in the public markets priced as value stocks,” Daftary said, adding that the company has a share price equivalent to an 18% CAGR. “We believe the company can continue to grow earnings per share in the mid-teens for many years to come,” which could one day rival some of the world’s largest chains, such as Starbucks and McDonalds. “We believe Couche can one day be one of the largest retailers in the world,” he said. The stock is down 4.4% this year and lost about 11% last month after the company posted disappointing third-quarter earnings. Short seller Chris Drose, founder of Bleecker Street Capital, called food packaging company Sealed Air “a melting ice cube hiding in plain sight.” The short seller noted that the company has a market cap of $5 billion with about $4.8 billion in debt. Nate Koppikar, portfolio manager at Orso Partners, called Globe Life a short pick, calling it “one of the dirtiest companies” he’s ever encountered because it uses brokers to sell short-term medical plans that “proved worthless” to customers . He expects the stock could plunge 50% this year as he expects the Justice Department and Federal Trade Commission to take action against the company. Shares fell 2.8% in afternoon trading. Safkhet Capital founder Fahmi Quadir called Adtalem Global Education its highest condemnation discount, noting that it received nearly $2 billion in taxpayer-funded grants last year but generates “horrendous student outcomes” with graduates unable to repay their debts.
Subscribe to Updates
Get the latest creative news from FooBar about art, design and business.
Here are the top picks of rising hedge fund stars at Sohn, including one that could nearly double
Related Posts
Add A Comment