Here’s What Hedge Funds Pitched at Sohn San Francisco
(Bloomberg) -- Marvell Technology Group Ltd., The New York Times Co. and Farfetch Ltd. were among companies pitched at the Sohn San Francisco investment conference on Monday. Here’s a rundown:
Marcato Capital Management founder Mick McGuire recommended CorePoint Lodging Inc. and Extended Stay America Inc., which he expected will both see price-to-earnings multiples expand. The companies are also attractive acquisition targets, he said.
Praesidium Investment Management’s Kevin Oram praised changes that Cornerstone OnDemand Inc. has made, such as improving corporate governance and overhauling sales practices, that he said will help it draw interest from potential acquirers. Microsoft Corp., Oracle Corp. or Salesforce.com Inc. could be potential suitors, Oram said.
Lucha Capital Management’s Marcelo Desio pitched Talend SA, an attractive acquisition target that should benefit from increasing demand for data integration. He said the stock could gain more than 80 percent by 2020.
Light Street Capital Management President Glen Kacher recommended Farfetch Ltd., which is poised to benefit as luxury apparel buying increasingly moves online. The stock may double over the next several years as margins rise and the total market expands, he said.
Highland Capital Management’s Michael McLochlin said Marvell Technology’s sales will likely expand faster than Wall Street currently anticipates, as will gross margins. Marvell’s return to strong secular growth could lead the stock to double in the next 12 months, he said.
Think Investments founder Shashin Shah said Radico Khaitan Ltd. is poised to benefit from rising alcoholic-beverage consumption in India as culture in the country evolves and the market for branded alcohol expands. Radico could be bought by a large company who wants to enter the Indian market, he said.
Aequim Alternative Investments Chief Investment Officer Franklin Parlamis recommended buying “deep in the money” convertible bonds at low premiums for companies like ServiceNow Inc. with relatively high market value to debt ratios, while also shorting the stocks. Returns could be 2 to 4 times capital invested over three to five years, he said.
TPG Public Equity Partners founder Alex Gleser recommended Royal Philips NV on the stock’s relative undervaluation compared with peers and projections for margin expansion. The stock could rise 85 percent in the next two years, he said.
Plaisance Capital founder Daniel Kozlowski pitched Denver-based utility Pure Cycle Corp. The stock could rise more than 10-fold in the next 10 to 15 years, he said.
SoMa Equity Partners’ Gil Simon pitched the New York Times as it evolves into a subscription Internet platform. He projected the stock could double in the next two years as total subscribers rise and recurring revenue accounts for a larger share of total sales.
No Street Capital’s Jeff Osher recommended shorting pet insurance company Trupanion Inc., which he said is in the first inning of a “rate spiral.” Osher criticized the company’s distribution model and said the stock could fall as much as 77 percent.
Longtail Alpha founder Vineer Bhansali recommended avoiding technology stocks as market volatility could rise further. Financial and small cap stocks with low-leverage are among investments that should benefit as the yield curve continues to steepen, he said.
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