AQR Capital’s Performance, AUM and Top Stock Picks

On this article, we talk about AQR Capital’s efficiency, AUM, and its high inventory picks. If you wish to see extra shares on this choice, take a look at AQR Capital's Top 5 Stock Picks

Cliff Asness’ AQR Capital Management’s trend-following methods are racking up important good points this yr as quants win inflation-driven value patterns in virtually all asset classes. AQR Capital’s Managed Futures Full Volatility Technique, representing about $1 billion in property, returned greater than 9% to traders within the 30-day interval ending October 6, which takes the entire returns this yr to 70%. Concurrently, AQR’s $450 million Different Development Technique has posted a 47% acquire in 2022. AQR’s main technique is to make the most of derivatives to observe value traits in most asset lessons, together with shares, bonds, commodities, and credit-default swaps. 

Bloomberg data suggests {that a} broad index monitoring rule-based pattern investing from Societe Generale SA is up 31%, marking top-of-the-line good points for this yr. Comparatively, AQR’s main mutual fund has returned about 38% to traders this yr. Yao Hua Ooi, principal at AQR, stated in an interview: 

“If macroeconomic volatility stays excessive and asset lessons proceed to point out large strikes in the identical route, we anticipate to see continued excessive returns for these methods.”

As of the tip of the third quarter of 2022, AQR Capital had discretionary property underneath administration of $145.45 billion, and the hedge fund managed a Q3 portfolio price $41 billion. Among the most notable shares within the AQR portfolio embrace Apple Inc. (NASDAQ:AAPL), Microsoft Company (NASDAQ:MSFT), and Alphabet Inc. (NASDAQ:GOOG). 

Our Methodology 

We chosen the highest 10 shares from the AQR portfolio as of the tip of the third quarter of 2022 for this evaluation. The shares are organized based on the hedge fund’s stake worth in every holding. Insider Monkey’s database of 920 elite hedge funds tracked as of the tip of the third quarter of 2022 was used to evaluate the hedge fund sentiment across the securities. 

AQR Capital's Performance, AUM and Top Stock PicksAQR Capital's Performance, AUM and Top Stock Picks

AQR Capital's Efficiency, AUM and High Inventory Picks

Cliff Asness of AQR Capital Administration

AQR Capital's Efficiency, AUM and High Inventory Picks

10. Meta Platforms, Inc. (NASDAQ:META)

Variety of Hedge Fund Holders: 177

AQR Capital's Stake Worth: $356,988,000

Meta Platforms, Inc. (NASDAQ:META) has been a part of AQR Capital’s portfolio for the reason that third quarter of 2013, aside from a couple of breaks over time. Securities filings for the third quarter of 2022 reveal that AQR Capital owns 2.6 million shares of Meta Platforms, Inc. (NASDAQ:META) price about $357 million, representing 0.87% of the entire portfolio. 

On November 15, Morgan Stanley analyst Brian Nowak reiterated an Equal Weight ranking on Meta Platforms, Inc. (NASDAQ:META) however trimmed the value goal on the shares to $100 from $105. Indicators of a tender advert market continued to extend via Q3 earnings season as 14 of 19 companies he covers within the sector both missed Q3 advert income estimates or slashed ahead development expectations, the analyst advised traders. He lowered his 2023 U.S. internet advertising and e-commerce estimates and now forecasts about 6% and 5% development in internet advertising and e-commerce, respectively.

In response to Insider Monkey’s information, Meta Platforms, Inc. (NASDAQ:META) was a part of 177 hedge fund portfolios on the finish of Q3 2022, in comparison with 185 funds within the prior quarter. Ken Fisher’s Fisher Asset Management held a distinguished stake within the firm, comprising 11.8 million shares price $1.60 billion. 

Like Apple Inc. (NASDAQ:AAPL), Microsoft Company (NASDAQ:MSFT), and Alphabet Inc. (NASDAQ:GOOG), Meta Platforms, Inc. (NASDAQ:META) is likely one of the high inventory picks of AQR Capital. 

Baron Funds made the next remark about Meta Platforms, Inc. (NASDAQ:META) in its Q3 2022 investor letter:

“Shares of Meta Platforms, Inc. (NASDAQ:META), the world’s largest social community, had been down 16% in the course of the quarter primarily as a consequence of broader digital promoting weak spot and continued difficulties with promoting effectiveness because of Apple’s enhanced privateness options carried out in late 2021. We consider Meta will efficiently resolve its short-term promoting expertise points by rising AI adoption and by driving better in-App consumer engagement with companies, enabling it to develop its understanding of individuals’s pursuits based mostly on first-party information. Long run, we consider Meta will make the most of its management in cellular promoting, large consumer base, and technological scale to offer international advertisers focused advertising capabilities at scale, with extra monetization alternatives forward in newer areas resembling Reels (Meta’s competing answer to TikTok) and e-commerce.”

9. CVS Well being Company (NYSE:CVS)

Variety of Hedge Fund Holders: 67

AQR Capital's Stake Worth: $365,686,000

CVS Well being Company (NYSE:CVS) is an American supplier of well being providers in the USA. The corporate operates via Well being Care Advantages, Pharmacy Companies, and Retail/LTC segments. Cliff Asness’ AQR Capital owns 3.8 million shares of CVS Well being Company (NYSE:CVS) price $365.6 million as of Q3 2022, representing 0.89% of the entire 13F securities. 

On November 2, CVS Well being Company (NYSE:CVS) reported a Q3 non-GAAP EPS of $2.09 and a income of $81.2 billion, topping Wall Road estimates by $0.10 and $4.42 billion, respectively. For full-year 2022, CVS Well being Company (NYSE:CVS) raised the adjusted EPS steering vary to $8.55-$8.65 from $8.40-$8.60, in comparison with an $8.55 consensus. The corporate lifted money move from operations steering vary to $13.5 billion-$14.5 billion from $12.5 billion-$13.5 billion. 

Raymond James analyst John Ransom on November 14 maintained an Outperform ranking on CVS Well being Company (NYSE:CVS) however trimmed the value goal on the shares to $115 from $120 following Q3 outcomes that had been better-than-anticipated, supported by strong leads to HCB, whereas the PBM and retail had been comparatively in line. For 2024, the analyst sees threat to administration's EPS estimate of low double-digit development given the macro headwinds, however believes that it has already been priced into the shares. 

In response to Insider Monkey’s information, 67 hedge funds had been bullish on CVS Well being Company (NYSE:CVS) on the finish of the third quarter of 2022, in comparison with 65 funds within the previous quarter. Ray Dalio’s Bridgewater Associates is a major place holder within the firm, with greater than 3 million shares price $293.7 million. 

Here is what Vltava Fund has to say about CVS Well being Company (NYSE:CVS) in its Q3 2022 investor letter:

“CVS is a pacesetter within the provision of healthcare providers within the USA. It has three fundamental companies: an infinite community of pharmacies, a medical health insurance firm, and “prescription profit administration”, which is a sort of middleman between insurance coverage firms and pharmacies. That is the results of giant acquisitions over the previous 15 years – most notably of Caremark (2007) and Aetna (2018). The markets had deemed its acquisition of well being insurer Aetna too costly (and we agree), so CVS inventory then fell into disfavour for a couple of years.

We took benefit of this in the summertime of 2020 and introduced the inventory into our portfolio at a time when its value was pressed down additional by the coronavirus pandemic. CVS is a huge. It has revenues of USD 300 billion, making it one of many largest firms on the planet. It's a comparatively secure and extremely worthwhile firm with robust free money move. Over the previous few years, CVS has centered totally on lowering debt.

That is already a lot decrease than it had been after the Aetna acquisition, and a lot of the money is now prone to go to shareholders via share buybacks or be used for smaller acquisitions to develop the corporate additional. CVS trades at about 11 instances annual earnings, which is a really interesting valuation given the anticipated future development in profitability and general modest cyclicality in its enterprise.”

8. Exxon Mobil Company (NYSE:XOM)

Variety of Hedge Fund Holders: 75

AQR Capital's Stake Worth: $379,998,000

Exxon Mobil Company (NYSE:XOM), the American oil and fuel supermajor, has persistently featured on the AQR portfolio for the reason that final quarter of 2010, aside from a couple of breaks over time. In Q3 2022, the hedge fund owned 4.35 million shares of Exxon Mobil Company (NYSE:XOM) price practically $380 million, representing 0.92% of the entire 13F securities. 

Exxon Mobil Company (NYSE:XOM) introduced on November 14 that in collaboration with Pertamina, an Indonesian nationwide oil firm, it has signed a $2.5 billion settlement to additional assess plans for an offshore carbon seize and storage venture within the nation. This venture can have the potential to retailer about 3 billion metric tons of carbon dioxide. 

On November 11, Piper Sandler analyst Ryan Todd raised the value goal on Exxon Mobil Company (NYSE:XOM) to $131 from $113 and saved an Chubby ranking on the shares. The Q3 outcomes had been incrementally bullish for the built-in oil 2023 macro outlook, the analyst advised traders in a analysis be aware.

In response to Insider Monkey’s information, 75 hedge funds had been lengthy Exxon Mobil Company (NYSE:XOM) on the finish of Q3 2022, in comparison with 72 funds within the prior quarter. Rajiv Jain’s GQG Partners held the most important stake within the firm, comprising 33.8 million shares price roughly $3 billion. 

In its Q2 2022 investor letter, First Eagle Investments, an asset administration agency, highlighted a couple of shares and Exxon Mobil Company (NYSE:XOM) was one in every of them. Here is what the fund stated:

“Built-in oil and fuel big Exxon Mobil Company (NYSE:XOM) carried out nicely within the second quarter as continued excessive costs for vitality merchandise supported the inventory. As the most important refiner within the US, the corporate has benefitted from large “crack spreads,” or the margin between the price of crude oil and the petroleum merchandise extracted from it. Exxon continues to spend money on refining capability within the US, which trade large has been in regular decline since 2019. We're happy that Exxon has been utilizing its robust money flows to cut back debt and to return money to shareholders via dividends and inventory repurchases.”

7. Tesla, Inc. (NASDAQ:TSLA)

Variety of Hedge Fund Holders: 88

AQR Capital's Stake Worth: $381,898,000

AQR Capital has owned a place in Tesla, Inc. (NASDAQ:TSLA) for the reason that third quarter of 2012, apart from minor breaks over time. AQR strengthened its maintain on Tesla, Inc. (NASDAQ:TSLA) by a whopping 327% in Q3 2022. The hedge fund owned 1.4 million shares of the corporate price about $382 million, representing 0.93% of the entire 13F portfolio. 

On November 11, Elon Musk's Tesla, Inc. (NASDAQ:TSLA) introduced that it added 43 Supercharger stations, together with 174 Superchargers, within the Chinese language mainland throughout October. These new services are based mostly in 31 cities, together with Shanghai, Chongqing, Nanjing, and Chengdu, amongst others.

Wedbush analyst Daniel Ives on November 10 eliminated Tesla, Inc. (NASDAQ:TSLA) from the agency's "Greatest Concepts" record, citing his short-term view that issues are "more and more changing into extra challenged," although his longer-term bullish view of Tesla, Inc. (NASDAQ:TSLA) stays largely unchanged. He sees "a really nervous few months forward for Tesla traders" as they "stay those which have been punched many times by the Musk Twitter antics," Ives stated. Nonetheless, the inventory is "deep within the investor penalty field till deliveries hit in early January," and the analyst maintained an Outperform ranking on Tesla, Inc. (NASDAQ:TSLA) shares.

Among the many hedge funds tracked by Insider Monkey, 88 funds reported proudly owning stakes price $7.4 billion in Tesla, Inc. (NASDAQ:TSLA) on the finish of the third quarter of 2022, in comparison with 73 funds within the prior quarter price $7.1 billion. Cathie Wooden’s ARK Investment Management held a major stake within the firm, consisting of greater than 4 million shares price $1.08 billion. 

Alger Capital made the next remark about Tesla, Inc. (NASDAQ:TSLA) in its Q3 2022 investor letter:

“Tesla, Inc. (NASDAQ:TSLA) is an electrical automobile producer with a major technological lead in its giant and quickly rising addressable market. Shares outperformed in the course of the quarter regardless of covid 19 shutdowns on the firm’s shanghai manufacturing plant early within the interval. Throughout this quarter, the corporate additionally ramped up manufacturing at its newer Germany and Texas crops. Whereas traders had been conscious of those difficult variables, the corporate’s quarterly outcomes exceeded expectations due to lower-than-expected working bills. Traders are conscious that ramping up electrical automobile manufacturing is difficult and acknowledge it’s tough to estimate manufacturing charges.”

6., Inc. (NASDAQ:AMZN)

Variety of Hedge Fund Holders: 269

AQR Capital's Stake Worth: $422,010,000, Inc. (NASDAQ:AMZN) is a long-term holding of AQR Capital. The hedge fund has owned a stake within the firm for the reason that final quarter of 2010, apart from a couple of breaks over time. Within the third quarter of 2022, AQR held 3.7 million shares of, Inc. (NASDAQ:AMZN) price $422 million, representing 1.02% of the entire portfolio. 

On November 16,, Inc. (NASDAQ:AMZN) introduced that its cloud computing division, Amazon Net Companies, would set up an infrastructure area in Spain and make investments as much as $2.6 billion within the nation over the span of a decade. It will generate greater than 1,300 full-time jobs in Spain and add roughly $1.8 billion to the nation’s gross home product.

MoffettNathanson analyst Michael Morton on November 15 assumed protection of, Inc. (NASDAQ:AMZN) with an Outperform ranking and a $118 value goal. The analyst doesn't consider within the bear case state of affairs of peak e-commerce penetration and thinks e-commerce penetration development will proceed on the historic tempo. He prefers market share gainers and finds it "difficult to have an urge for food for market share losers" as he famous that the algorithm of the web "creates a self-fulfilling prophecy for continued share loss as soon as it begins."

In response to Insider Monkey’s Q3 information, 269 hedge funds had been lengthy, Inc. (NASDAQ:AMZN), up from 252 funds within the prior quarter. The collective stakes in Q3 elevated to $34.6 billion from $30 billion in Q2. 

Along with Apple Inc. (NASDAQ:AAPL), Microsoft Company (NASDAQ:MSFT), and Alphabet Inc. (NASDAQ:GOOG),, Inc. (NASDAQ:AMZN) is backed by AQR Capital and different elite hedge funds. 

Baron Funds made the next remark about, Inc. (NASDAQ:AMZN) in its Q3 2022 investor letter:

“, Inc. (NASDAQ:AMZN) is the world’s largest e-commerce retailer and cloud providers supplier. Shares of Amazon elevated 6% within the quarter after the corporate reported robust outcomes with 7% year-over-year income development pushed by 33% development in Amazon Net Companies (AWS), Amazon’s main cloud computing service, whereas guiding for an acceleration in third quarter income development, which is anticipated to be between 13% and 17% year-over-year. Amazon’s share of e-commerce is roughly 40%, far forward of competitors, but home e-commerce accounted for under 14.5% of whole retail gross sales (based on U.S. Census Bureau information for the second quarter of 2022), implying sturdy development alternatives forward. Internationally, the chance stays giant as Amazon nonetheless has lower than a 2% market share of worldwide retail spending. Its promoting share can also be solely 3% and rising, underpinned by the structural closed-loop methods it permits (retailers know precisely whether or not their advert {dollars} resulted in a purchase order since they're all accomplished on the Amazon platform), which permits correct focusing on and measurement. Lastly, AWS has runway for development because the trade nonetheless represents solely 9.5% out of the $4.3 trillion of world IT spending based on Gartner. Areas resembling logistics and well being care current extra optionality.”

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Disclosure: None. AQR Capital's Efficiency, AUM and High Inventory Picks is initially revealed on Insider Monkey.

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