Billionaire George Soros Picks These Three “Strong Buy” Stocks
Some investors have achieved legendary status. Surpass your competitors by luck and success. Perhaps no one is more exemplary than George Soros, a genocide survivor who earned a doctorate from the London School of Economics and entered the banking industry to make his mark after the war. He was very successful. The hedge fund he founded, Soros Fund Management, earned an average annual return of 33% from 1970 to 2020, making it the most successful hedge fund in history. Soros’ biggest single success came on September 16, 1992, when he ‘breaking the Bank of England’ he won a short title in the pound sterling. It raised it to $10 billion and when the pound fell in response to changing politics. He himself made $1 billion in one day. Soros was not always right in his financial claims. But he was right more often than he was wrong. He is also known for his bon mots when it comes to trading. “It’s not that you’re right or wrong,” Soros said, citing the statement. “But how much money do you make when you’re right? And how much do you lose when you’re wrong?” So we decided to look at the latest Soros Fund Management activities for inspiration. Using the three stocks the fund picked up during Q1 through the TipRanks database, we found that the analyst community was also engaged. As each share has a consensus score of “Strong Buy” Farfetch, Ltd. (FTCH), we will start with online retail stock Farfetch, a company specializing in luxury goods and luxury goods brands. Farfetch is a truly international company. Founded in Portugal Headquartered in London and has offices in New York and LA. Tokyo and Shanghai and Brazil, like many tech-focused firms, Farfetch suffered losses, but in Q1 this year, the company made a sudden turn to profitability. It reported first-quarter earnings of $516.7 million in profit after taxes, compared with a loss of $79.2 million last year. The company said this gross profit included a one-time non-cash benefit of $660 million. Revenue from operations was $485 million, an increase of 46 percent year-on-year. And it exceeded analysts’ estimates of $457 million. One key metric was the total merchandise value of orders processed on the company’s platform, up 49 percent year-on-year to $915.6 million. Farfetch has grown from a strong user base. The company has more than 3 million active customers and operates in 190 countries. Sellers on the platform serve more than 1,300 luxury brands. Even though its share value fell in the first half of 2021, the stock is still rising dramatically. An impressive 234% over the past 12 months among FTCH fans is Soros. Soros said his fund bought 125,000 shares of FTCH, now worth more than $5.5 million, when he turned to analysts. Credit Suisse 5-star analyst Stephen Ju rates FTCH as outperforming (i.e. BUY) with a price target of $78. Investors stand up to ~88% profit pockets if the analyst thesis comes out. (To view Ju’s profile, click here.) “We have a positive view of the company that maintains its adjusted EBITDA guidance as Farfetch will reinvest a higher portion of its customer acquisitions. which supports long-term adoption rates We generate about 700k new customers in 2021 and about 600k in 2022 and starting in 2023, our expectations are unchanged at ~1.2 million to 1.5 million,” Ju said. “The points in our investment thesis remain: 1) The massive US$300 billion addressable market continues to be fragmented and penetrated; 2) Relevant protection from competition from online competitors. 3) Increased exposure to luxury goods in the Asia-Pacific region Emerging Markets.” Most analysts support Ju’s confidence in the online fashion company. As TipRanks analysis shows, FTCH is a strong buy. In a survey of 8 analysts over the past 3 months, 6 voted stocks bought, while 2 voted holdings. The 12-month median target is $60.63, an upside of about 37% from current levels. (See TipRanks analysis of FTCH stocks.) Coursera (COUR) Coursera The next stock we’re looking at is MOOC, a large open-source online course provider. The channel leverages the size and reach of the Internet to create a wide range of university-leading courses for the masses. Coursera is a leader in this field. And since its inception in 2012, the company has offered more than 4,000 courses from more than 200 universities, over 30 courses, and at a lower cost than face-to-face tuition. Through Coursera, students can attend top-tier schools such as Imperial College. London, University of Illinois Urbana-Champaign, University of Michigan and Johns Hopkins The company employs more than 77 million students. Although the company is nine years old, it is new to the public market. Coursera held an IPO at the end of March this year, earning 15.73 million shares in the NYSE at an opening price of $33, its initial high. This is set between $30 and $33. In total, the IPO raised $519 million before expenses. In early May, Coursera released its first quarterly report since going public. The report said revenue totaled $88.4 million, a 64 percent year-over-year increase. The company’s gross profit was $49.5 million, an increase of 71% from the same quarter last year. George Soros saw the opportunity for an IPO and his fund received 105,000 shares of the company. Approximately $4 million at current share price. Among the bulls was Ryan MacDonald, a 5-star analyst at Needham, who laid the clear and optimistic case for Coursera stock. widening skill gap and the transition to online learning We believe that Coursera’s comprehensive platform will enable it to gain a share of the large TAM we have set between $47B-50.6B while being driven by COVID-19. Going into the growth of enrolled learners in FY 20 will create a tough consumer segment in FY21. We believe Coursera’s efficient GTM movement and shift to higher value enterprises and offerings. Degrees can drive sustained 25%+ growth and gross margin expansion,” MacDonald noted. As a result, MacDonald rates COUR a buy, and his $56 price target indicates confidence in the 47% upside in the range. next 12 months (To see MacDonald’s bio, click here.) In his brief time on the stock exchange, COUR has compiled 14 analyst reviews, detailing 12 buys in two, to support Strong Buy’s credit rating. At $38 and an average price target of $54.67, it represents a one-year upside of 44% (see COUR stock analysis on tip ratings). Sotera Health (SHC) Our latest position from George Soros is Sotera Health, a company. Holdings, whose affiliates provide consulting services. laboratory test Sotera’s business serves more than 5,800 healthcare customers in more than 50 countries. The company has 13 laboratories capable of conducting more than 800 tests and 50 sterilization facilities. Sotera’s customer base It consists of the top 75 of the top 100 medical device manufacturers and 8 of the top 10 pharmaceutical companies. SHC shares went public on November 24 of last year. In the IPO, it sold 53.6 million shares and raised $1.2 billion. The additional capital is used to pay off existing debts. The company has been working aggressively to lower its debt levels, and in its 1Q21 report it had $1.87 billion in total debt and $108 million in cash. First-quarter net income was $212 million, an increase of 13% from a year earlier. Strong net income growth It shifted from a 1 percent loss per share last year to a 4 percent earnings per share in Q1. Soros took a new position in Sotera, buying 179,274 shares at current share prices. The holding is valued at more than $4.3 million. JPMorgan’s 5-star Tycho Peterson likes SHC and rates the stock as overweight (i.e. buy). His $35 price target suggests a 45% advantage over the leverage level. current trading (To view Peterson’s bio, click here.) Peterson wrote in support of his stance: “The first quarter results are usually strong. and although the instructions remain unchanged But it should be the way to the upside for the balance of 2021 as we remain fans of The company’s various operating platforms Strong multi-year contract Effective pricing strategy and high-level regulatory oversight All support a very competitive moat, with FCF to accommodate the de-utilization of…” Overall, Street is unanimous in its view on Sotera shares; The stock has had 8 recent positive reviews, supporting strong analyst consensus ratings. The stock is trading at $24.06, and its average target price of $31.75 represents a one-year upside of ~32% (see SHC stock analysis on TipRanks). For trading stocks with attractive valuations Head over to TipRanks Stocks to Buy, a newly released tool that combines all TipRanks stock insights. Disclaimer: The opinions expressed in this article are the opinions of a prominent analyst only. This content is for informational purposes only. It is very important to do your own analysis before making any investments.