3 stocks according to Paul Tudor Jones could soar by the end of the year
Whenever a billionaire hedge fund manager talks, people listen, which is why investors may want to listen to Paul Tudor Jones’ stock picks. According to a recent CNBC article, the living Wall Street legend thinks the Federal Reserve is done raising interest rates. Looking ahead, the stock market may rise this year. Admittedly, the hedge fund manager continues to say that he is not bullishly bullish as he anticipates a slow advance. Nonetheless, some of the biggest names in Paul Tudor Jones’ portfolio could see significant returns if the underlying prognosis turns out to be correct.
Helping things out for recommendations by Paul Tudor Jones focuses on the negative impression that dominates business headlines. More worryingly, the debt ceiling debate continues to see no sign of consensus, raising huge concerns for equities. Additionally, total consumer debt has surpassed the $17 trillion level, indicating significant vulnerability.
In other words, the best Paul Tudor Jones bets can be ideally positioned. Because so many people are anticipating the worst, the disappearance of a crisis can drive stocks higher – perhaps much more than the billionaire expects. Below are three ideas from his portfolio to consider.
|CPT||Camden Estate Trust||$106.27|
Philips 66 (PSX)
One of the most exciting ideas among Paul Tudor Jones’ stock picks is the downstream energy giant Phillips 66 (NYSE:PSX). Specializing in refining and marketing initiatives, Phillips 66 operates where economical rubber meets the road. Therefore, even if Jones is wrong and the economy slips into a deep recession, PSX could perform reasonably well. Either way, people have to get from point A to point B.
As said bluntly, Phillips 66 enjoys a captive audience. As a result, PSX ranks among the Paul Tudor Jones inflation stocks to buy. Fortunately, it’s not just cynicism that underpins the narrative. Overall, the downstream actor benefits from a solid financial context. In particular, its Altman Z-Score shows 4.15, indicating high stability and low risk of bankruptcy.
Currently, PSX ranks third in Paul Tudor Jones’ portfolio (under Tudor Investment Holdings). It represents 0.66% of the total holdings, with a market value of $34.59 million. Finally, Wall Street analysts view PSX as a strong consensus buy. Their average price target sits at $125.63, implying more than 32% upside potential.
Camden Property Trust (CPT)
An intriguing but risky idea among Paul Tudor Jones stock picks, Camden Estate Trust (NYSE:CPT) is a real estate investment trust that invests in apartments in the United States. Probably a typical billionaire idea, Camden has a cynical profile. Basically, with house prices and now interest rates having reached ridiculous levels, workers are now forced to rent indefinitely.
However, this evil genius idea among Paul Tudor Jones’ recommendations didn’t work out so well this year. Since opening in January, CPT has lost nearly 4% of its net worth. And in the past 365 days, stocks have fallen more than 23%. Nonetheless, CPT ranks in the top 50 of Paul Tudor Jones’ portfolio. Camden represents 0.45% of the total holdings, or $23.72 million. Keep in mind that Camden’s three-year revenue growth rate is 8.3%, better ranked than 79.46% of companies listed as REITs.
Finally, coverage analysts rate CPT as a Moderate Buy. Their average price target reaches $121.80, implying more than 14% upside potential.
Probably one of the most contested ideas among Paul Tudor Jones stock picks, VMWare (NYSE:vmw) will more than likely require the billionaire’s broader economic thesis to come to fruition to sustain momentum. In this regard, the pressure is strong. A cloud computing and virtualization technology company, VMWare is promising. Since the January open, shares have gained almost 3% in stock value. Over the previous year, they increased by more than 31%.
However, after having gained so much, some investors might be looking to offload some exposure. This sentiment could accelerate in the event of a downturn. So it’s probably vital that Jones’ thesis rings true. Financially, VMWare presents a mixed bag, leading to weak revenue growth and poor balance sheet strength. However, it is still profitable and may be undervalued against future earnings.
One of Paul Tudor Jones’ top bets, VMW makes up 0.43% of total holdings. Nominally, this translates to $22.42 million. In conclusion, analysts consider VMW as a consensus. Overall, the average price target sits at $137.33, implying more than 9% upside potential.
As of the date of publication, Josh Enomoto had no position (directly or indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com Publication guidelines.