Billionaire Stephen Mandel’s Portfolio: 8 New Stock Picks

·9 min read

In this article, we discuss 8 new stock picks of billionaire Stephen Mandel. If you want to skip our detailed analysis of these stocks, go directly to Billionaire Stephen Mandel's Portfolio: 3 New Stock Picks.

Lone Pine Capital was founded by billionaire Stephen Mandel in 1997, who served as the hedge fund's president and portfolio manager till January 2019. Although Mandel does not actively manage Lone Pine Capital’s investments, he is still the managing director of the Connecticut-based hedge fund.

The hedge fund invests primarily in the information technology, healthcare, finance, consumer discretionary, and communications sectors, with a top ten holdings concentration of 48.79%. Lone Pine Capital purchased 6 new stocks in the third quarter, bought additional stakes in 10 securities, sold out of 3 equities, and reduced holdings in 17 companies.

The hedge fund’s top buys for Q3 2021 were Twitter, Inc. (NYSE:TWTR), Bilibili Inc. (NASDAQ:BILI), and Workday, Inc. (NASDAQ:WDAY). Whereas, Lone Pine Capital reduced holdings in Global Payments Inc. (NYSE:GPN), Mastercard Incorporated (NYSE:MA), and Adobe Inc. (NASDAQ:ADBE).

The most notable stocks from Lone Pine Capital’s Q3 portfolio included Microsoft Corporation (NASDAQ:MSFT), Meta Platforms, Inc. (NASDAQ:FB), and Amazon.com, Inc. (NASDAQ:AMZN).

Billionaire Stephen Mandel's Portfolio: 8 New Stock Picks
Billionaire Stephen Mandel's Portfolio: 8 New Stock Picks

Stephen Mandel of Lone Pine Capital

Our Methodology

We used the investment portfolio of Stephen Mandel’s Lone Pine Capital to select the fund’s newest stock picks from the third quarter of 2021. We ranked the securities according to Lone Pine Capital’s stake value in each holding.

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

Billionaire Stephen Mandel's Portfolio: New Stock Picks

8. Freshworks Inc. (NASDAQ:FRSH)

Lone Pine Capital’s Stake Value: $11,740,000

Percentage of Lone Pine Capital’s 13F Portfolio: 0.03%

Number of Hedge Fund Holders: 41

Freshworks Inc. (NASDAQ:FRSH) is a tech company offering SaaS solutions, enabling efficient customer services, sales, marketing, and HR operations. Freshworks Inc. (NASDAQ:FRSH)’s initial public offering kicked off on September 22, with 28.5 million shares, priced at $36 per share.

Lone Pine Capital acquired an $11.74 million stake in Freshworks Inc. (NASDAQ:FRSH) as of Q3 2021, which accounts for 0.03% of the fund’s total investments over the period.

Freshworks Inc. (NASDAQ:FRSH) announced its Q3 results on November 2, posting a loss per share of $0.04, beating estimates by $0.06. Revenue over the period totaled $96.61 million, exceeding estimates by $5.69 million.

Barclays analyst Raimo Lenschow on January 11 lowered the price target on Freshworks Inc. (NASDAQ:FRSH) to $27 from $45 and kept an Equal Weight rating on the shares, citing valuation as a concern in the software space.

In the third quarter of 2021, 41 hedge funds were bullish on Freshworks Inc. (NASDAQ:FRSH), with stakes amounting to $316.23 million.

Like Microsoft Corporation (NASDAQ:MSFT), Meta Platforms, Inc. (NASDAQ:FB), and Amazon.com, Inc. (NASDAQ:AMZN), Freshworks Inc. (NASDAQ:FRSH) is a notable stock from Lone Pine Capital's Q3 portfolio.

7. Marqeta, Inc. (NASDAQ:MQ)

Lone Pine Capital’s Stake Value: $57,988,000

Percentage of Lone Pine Capital’s 13F Portfolio: 0.19%

Number of Hedge Fund Holders: 20

Marqeta, Inc. (NASDAQ:MQ), a company offering prepaid, debit, and credit cards, is one of the newest additions in Lone Pine Capital’s third quarter portfolio, with the hedge fund purchasing 2.62 million shares of the company, worth $57.9 million. The stock accounts for 0.19% of the Q3 securities of Lone Pine Capital.

Marqeta, Inc. (NASDAQ:MQ) announced on November 24 that it is partnering with the payment solutions firm, Paycast, to offer digital card products so that sellers are paid efficiently. Marqeta, Inc. (NASDAQ:MQ) has also offered strategic funding to Paycast.

On November 10, Marqeta, Inc. (NASDAQ:MQ) published its third quarter results, posting a loss per share of $0.08, beating estimates by $0.05. Revenue over the period equaled $131.51 million, exceeding estimates by $12.29 million.

Mizuho analyst Dan Dolev upgraded Marqeta, Inc. (NASDAQ:MQ) to Buy from Neutral with a price target of $20, down from $27 on January 13. The analyst said that after a disappointing start for the company with decelerating volumes from its top customers, he believes that growth for this cohort likely inflected positively in Q3, potentially reflecting wallet-share gains.

Philippe Laffont’s Coatue Management is the biggest Marqeta, Inc. (NASDAQ:MQ) stakeholder as of Q3 2021, with 28.4 million shares worth $612.4 million. Overall, 20 hedge funds were long Marqeta, Inc. (NASDAQ:MQ) in the third quarter, down from 35 funds in the preceding quarter.

Here is what Artisan Mid-Cap Fund has to say about Marqeta, Inc. (NASDAQ:MQ) in its Q3 2021 investor letter:

“Marqeta is a digital payment software company with a focus on providing fintechs and merchants the infrastructure to build and process configurable payment cards. The company’s superior API technology allows it to easily connect to customers’ internal systems, enabling quicker product development and introduction. Marqeta’s growth over the years has been largely attributed to its partnership with Square’s Cash App—more than 70% of revenues—but we believe recent client wins (Google Pay) and the continued emergence of innovative digital payment services who need Marqeta’s technology infrastructure make for a compelling profit cycle ahead. With shares pulling back during the quarter, we initiated a small GardenSM position.”

6. NetEase, Inc. (NASDAQ:NTES)

Lone Pine Capital’s Stake Value: $86,714,000

Percentage of Lone Pine Capital’s 13F Portfolio: 0.29%

Number of Hedge Fund Holders: 32

Lone Pine Capital acquired a stake in NetEase, Inc. (NASDAQ:NTES) during the third quarter, buying more than 1 million shares of the company, worth $86.71 million, representing 0.29% of the fund’s Q3 portfolio. NetEase, Inc. (NASDAQ:NTES) is a Chinese IT company, offering online games, advertising, email services, and e-commerce platforms.

On November 19, NetEase, Inc. (NASDAQ:NTES) declared a $0.225 per average diluted share quarterly dividend, which reflects a 6.2% decrease from the prior dividend of $0.240. The dividend was paid on December 16 to shareholders of record on December 1. NetEase, Inc. (NASDAQ:NTES)’s dividend policy includes paying 20% to 30% of the net income after taxes in each fiscal quarter.

NetEase, Inc. (NASDAQ:NTES) posted its Q3 earnings on November 16, reporting an EPS of $0.90, missing estimates by $0.06. Revenue over the period jumped 22.40% year-over-year to $3.47 billion, outperforming estimates by $145.33 million.

Citi analyst Alicia Yap on November 17 lowered the price target on NetEase, Inc. (NASDAQ:NTES) to $136 from $142 and kept a Buy rating on the shares, citing "solid" Q3 results.

Among the hedge funds tracked by Insider Monkey during the third quarter, 32 funds reported owning stakes in NetEase, Inc. (NASDAQ:NTES), worth $2.3 billion, as compared to 43 funds holding stakes valued at $3.7 billion in NetEase, Inc. (NASDAQ:NTES) in the preceding quarter.

William B. Gray’s Orbis Investment Management is the largest NetEase, Inc. (NASDAQ:NTES) stakeholder, holding 16.3 million shares worth $1.39 billion.

5. Amplitude, Inc. (NASDAQ:AMPL)

Lone Pine Capital’s Stake Value: $88,411,000

Percentage of Lone Pine Capital’s 13F Portfolio: 0.29%

Number of Hedge Fund Holders: 15

Amplitude, Inc. (NASDAQ:AMPL), a company offering analytics products that enable digital optimization for businesses, is one of the newest acquisitions of Lone Pine Capital as of Q3 2021. The hedge fund purchased 1.62 million Amplitude, Inc. (NASDAQ:AMPL) shares, worth $88.4 million, representing 0.29% of the total third quarter investments.

Announcing its Q3 results on November 9, Amplitude, Inc. (NASDAQ:AMPL) posted a loss per share of $0.05, exceeding estimates by $0.09. Revenue over the period totaled $45.47 million, beating estimates by $1.90 million.

Citi analyst Tyler Radke initiated coverage of Amplitude, Inc. (NASDAQ:AMPL) with a Buy rating and a $80 price target on December 8. According to the analyst, Amplitude, Inc. (NASDAQ:AMPL)’s platform helps companies unify complex digital product data with other proprietary and customer data sources, which improves strategic decision making.

A total of 15 hedge funds were long Amplitude, Inc. (NASDAQ:AMPL) in the third quarter, with stakes amounting to $313.2 million. Gil Simon’s SoMa Equity Partners is one of the leading stakeholders of Amplitude, Inc. (NASDAQ:AMPL), with a $54.3 million position in the company.

In addition to Microsoft Corporation (NASDAQ:MSFT), Meta Platforms, Inc. (NASDAQ:FB), and Amazon.com, Inc. (NASDAQ:AMZN), hedge funds are piling into Amplitude, Inc. (NASDAQ:AMPL).

4. VTEX (NYSE:VTEX)

Lone Pine Capital’s Stake Value: $108,504,000

Percentage of Lone Pine Capital’s 13F Portfolio: 0.36%

Number of Hedge Fund Holders: 14

VTEX (NYSE:VTEX) is a company offering a digital commerce platform that allows brands to reach customers across multiple channels, accelerate growth, and achieve faster time to market. Lone Pine Capital bought 5.2 million VTEX (NYSE:VTEX) shares in the third quarter, worth $108.5 million, representing 0.36% of the fund’s Q3 securities.

VTEX (NYSE:VTEX) announced on September 30 that it has initiated an integration with Meta Platforms, Inc. (NASDAQ:FB) to allow improved ecommerce conversion rates, and enable its clients to register their products on all Meta Platforms, Inc. (NASDAQ:FB) applications, which will optimize results and sales performance.

Publishing its Q3 results on November 17, VTEX (NYSE:VTEX) reported a loss per share of $0.07, exceeding estimates by $0.03. The $31.86 million revenue outperformed estimates by $569,250.

Among the hedge funds tracked by Insider Monkey, Chase Coleman’s Tiger Global Management is the largest VTEX (NYSE:VTEX) stakeholder, with 11.3 million shares worth $232.6 million. Overall, 14 hedge funds were bullish on VTEX (NYSE:VTEX) in Q3 2021, with stakes valued at $468 million.

Here is what ClearBridge Select Strategy has to say about VTEX (NYSE:VTEX) in its Q3 2021 investor letter:

“Also within the disruptors segment, we initiated a position in VTEX, an e-commerce and customer engagement software provider serving the higher end of the market in Latin America. VTEX enables large LatAm commerce companies and brands to establish an omnichannel selling presence and helps multinational brands such as Carrefour, L’Oreal, Motorola and Mondelez reach the LatAm market. VTEX expands the portfolio’s exposure to fast growing LatAm, supplementing existing holding MercadoLibre, which operates more as a marketplace in the region.”

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Disclosure: None. Billionaire Stephen Mandel's Portfolio: 8 New Stock Picks is originally published on Insider Monkey.

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