10 Best Stocks to Invest In According to Philip Timon’s Owls Nest Partners
In this article, we will discuss the 10 best stocks to invest in according to Philip Timon's Owls Nest Partners based on Q1 holdings of the fund. If you want to skip our detailed analysis of Timon's history, investment philosophy, and hedge fund performance, go directly to the 5 Best Stocks to Invest In According to Philip Timon's Owls Nest Partners.
Philip Timon is a financial adviser with 13 years of expertise based in Chadds Ford, Pennsylvania. He is the portfolio manager of Owls Nest Partners.
Some notable holdings of Philip Timon's Owls Nest Partners as of the end of the first quarter include The Ensign Group, Inc. (NASDAQ: ENSG), Progyny, Inc. (NASDAQ: PGNY), and Grand Canyon Education, Inc. (NASDAQ: LOPE).
In The Ensign Group, Inc. (NASDAQ: ENSG), Philip Timon's Owls Nest Partners owns 239,350 shares. The investment covers an impressive 13.1% of the fund’s portfolio. On July 28, The Ensign Group, Inc. (NASDAQ: ENSG) posted earnings for the second quarter of 2021. It reported earnings per share of $0.89, beating market predictions by $0.01. On June 22, Stifel analyst Tao Qiu initiated coverage on The Ensign Group, Inc. (NASDAQ: ENSG) with a “Buy” rating and $95 price target.
Philip Timon's Owls Nest Partners also has a stake in Progyny, Inc. (NASDAQ: PGNY), even though the hedge fund slashed its stake in the company by 14% in the first quarter. It still owns 478,850 shares of the company, worth $21.31 million. Progyny, Inc. (NASDAQ: PGNY), a benefits management company, specializes in fertility and family building benefits solutions for employers in the United States.
Based on the latest 13F holdings for the first quarter of 2021, Owls Nest Partners owns 198,400 shares in Grand Canyon Education, Inc. (NASDAQ: LOPE) after cutting its holding in the company by 2% from Q4 2020. On August 5, Grand Canyon Education, Inc. (NASDAQ: LOPE) declared results for the second quarter of 2021. The company posted earnings per share of $1.12, beating the estimates by $0.03. The revenue over the period was $201.48 million, up 8.5% YoY.
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Why pay attention to Philip Timon's stock picks? Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and July 2021 our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY. Our stock picks outperformed the market by more than 115 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
With this context in mind, here is our list of 10 best stocks to invest in according to Philip Timon's Owls Nest Partners. We used Timon's 13F portfolio for the first quarter for this analysis.
Best Stocks to Invest in According to Philip Timon's Owls Nest Partners
10. Zillow Group, Inc. (NASDAQ: Z)
Timon's Stake Value: $331,000 Percentage of Philip Timon's 13F Portfolio: 0.19% Number of Hedge Fund Holders: 82
Zillow Group, Inc. (NASDAQ: Z) is an American digital real estate company. It was founded in 2004 and is placed tenth on the list of 10 best stocks to invest in according to Philip Timon's Owls Nest Partners. Zillow Group, Inc. (NASDAQ: Z) stock has offered investors more than 32.51% in returns over the course of the past 12 months.
On August 5, Zillow Group, Inc. (NASDAQ: Z) reported earnings for the second quarter of 2021. Revenue over the period was $1.31 billion, surpassing forecasts by $40 million. The same day, Zillow Group, Inc. (NASDAQ: Z) was upgraded to “Buy” from “Hold” by Zelman, which stated that cyclical concerns are now better represented in the stock price.
Owls Nest Partners holds 2,550 shares in Zillow Group, Inc. (NASDAQ: Z), worth over $331 thousand. This represents 0.19% of their portfolio. The hedge fund’s stake in Zillow stock increased by 14% in the first quarter of 2021, the latest data reveals. Catherine D. Wood’s ARK Investment Management is a leading shareholder in Zillow Group, Inc. (NASDAQ: Z) with 10.15 million shares worth more than $1 billion.
Just like The Ensign Group, Inc. (NASDAQ: ENSG), Progyny, Inc. (NASDAQ: PGNY), and Grand Canyon Education, Inc. (NASDAQ: LOPE), Zillow Group, Inc. (NASDAQ: Z) is one of the best stocks according to Philip Timon's Owls Nest Partners.
In its second quarter 2021 investor letter of RiverPark Funds, mentioned Zillow Group, Inc. (NASDAQ: Z). Here is what the fund said:
“Although Zillow’s 1Q results comfortably topped Street estimates across every major business metric, Zillow Group, Inc. (NASDAQ: Z) shares were our final top detractor as 2Q guidance was mixed as the company plans to reinvest more aggressively, which will likely be a short-term drag on profitability. Zillow Group, Inc. (NASDAQ: Z)’s total revenue grew 8% year over year and 54% quarter over quarter. IMT (the company’s media business, which currently delivers the majority of its cashflow) grew revenue
35% year over year and adjusted EBITDA increased 143% year over year to $209 million with 2,100 basis points of margin expansion to 47%. Zillow Group, Inc. (NASDAQ: Z) management guided to second quarter revenue of $1.24 billion to $1.28 billion, representing 61%-67%, driven by 64%-68% IMT growth and $116 million to $140 million adjusted EBITDA, up from $16 million in 2Q20.….”(Click here to see the full text)
9. PaySign, Inc. (NASDAQ: PAYS)
Timon's Stake Value: $865,000 Percentage of Philip Timon's 13F Portfolio: 0.5% Number of Hedge Fund Holders: 10
PaySign, Inc. (NASDAQ: PAYS) provides prepaid card products and processing services for corporate, consumer, and government applications. The company was founded in 1995 and stands ninth on the list of 10 best stocks to invest in according to Philip Timon's Owls Nest Partners. The shares of PaySign, Inc. (NASDAQ: PAYS) currently have a $127.99 million market capitalization.
On August 10, PaySign, Inc. (NASDAQ: PAYS) released earnings for the second quarter of 2021. The firm reported earnings per share of -$0.02, beating the estimates by $0.01. Revenue was $6.65 million, up 3.3% year over year, missing the forecast by $0.11 million.
The hedge fund chaired by Philip Timon holds 198,000 shares in PaySign, Inc. (NASDAQ: PAYS) worth $865 thousand. Owls Nest Partners' stake in PaySign shares decreased by 21% in the first quarter of 2021.
Just like The Ensign Group, Inc. (NASDAQ: ENSG), Progyny, Inc. (NASDAQ: PGNY), and Grand Canyon Education, Inc. (NASDAQ: LOPE), PaySign, Inc. (NASDAQ: PAYS) is one of the best stocks according to Philip Timon's Owls Nest Partners.
In its fourth-quarter 2020 Investor Letter, Wasatch Micro Cap Value Fund highlighted a few stocks, and PaySign, Inc. (NASDAQ: PAYS) is one of them. Here is what the fund said:
“Paysign, Inc. (PAYS) was also a major detractor. The company develops and manages payment services, prepaid-card programs and customized payment plans. A large portion of Paysign’s business comes from blood banks. With many of the usual blood donors receiving government assistance and limiting their personal interactions, activity at blood banks has declined—which was a trend we saw coming. But we misjudged the magnitude of the trend. At the lower share prices recently available, we increased our position in Paysign because we think payment activity will accelerate as the economy continues to reopen and people resume more of their normal routines.”
8. Tecnoglass Inc. (NASDAQ: TGLS)
Timon's Stake Value: $1,798,000 Percentage of Philip Timon's 13F Portfolio: 1.04% Number of Hedge Fund Holders: 10
Tecnoglass Inc. (NASDAQ: TGLS) manufactures, supplies, and installs the architectural glass, windows, and other aluminum products for the commercial and residential building industries through its subsidiaries. The company was founded in 1984 and ranks eighth on the list of 10 best stocks to invest in according to Philip Timon's Owls Nest Partners. Tecnoglass Inc. (NASDAQ: TGLS) currently has a $1.1 billion market capitalization and was able to deliver a 331.58% return in the past 12 months.
On August 9, Raymond James analyst Joshua Wilson raised the price target on Tecnoglass Inc. (NASDAQ: TGLS) to $26 from $15 and maintained a “Strong Buy” rating on the shares. On August 6, the company announced earnings for the second quarter of 2021. The company posted earnings per share of $0.41, beating the market predictions by $0.09. The revenue over the period was $121.7 million, 48.5% YoY, beating the estimates by $14.67 million. On June 7, Tecnoglass Inc. (NASDAQ: TGLS) declared a quarterly dividend of $0.0275 per share, in line with the previous.
Owls Nest Partners holds 149,602 shares in Tecnoglass Inc. (NASDAQ: TGLS) worth over $1 million, representing 1.04% of its portfolio. The hedge fund has increased stakes in the firm by 50% in the first quarter of 2021. In addition, hedge funds are loading up on Tecnoglass Inc. (NASDAQ: TGLS), as Insider Monkey's data shows that 10 hedge funds held stakes in the company as of the end of the first quarter of 2021, compared to 6 funds a quarter earlier.
Just like Zillow Group, Inc. (NASDAQ: Z), The Ensign Group, Inc. (NASDAQ: ENSG), Progyny, Inc. (NASDAQ: PGNY), and Grand Canyon Education, Inc. (NASDAQ: LOPE), Tecnoglass Inc. (NASDAQ: TGLS) is one of the best stocks according to Philip Timon's Owls Nest Partners.
7. Repay Holdings Corporation (NASDAQ: RPAY)
Timon's Stake Value: $11,604,000 Percentage of Philip Timon's 13F Portfolio: 6.77% Number of Hedge Fund Holders: 15
Repay Holdings Corporation (NASDAQ: RPAY) supplies industry-oriented marketplaces with integrated payment processing solutions. The company was founded in 2006 and is placed seventh on the list of 10 best stocks to invest in according to Philip Timon's Owls Nest Partners. Repay Holdings Corporation (NASDAQ: RPAY) currently has a $2.4 billion market capitalization.
On August 9, Repay Holdings Corporation (NASDAQ: RPAY) announced its earnings for the second quarter of 2021. It posted earnings per share of $0.34, beating the market predictions by $0.20. In addition, the revenue over the period was $48.4 million, beating the estimates by $3.96 million. On July 7, Repay Holdings Corporation (NASDAQ: RPAY) declared a collaboration with Credit Management Company.
Philip Timon's Owls Nest Partners currently holds 494,200 shares of Repay Holdings Corporation (NASDAQ: RPAY) that amounts to $11.60 million. Repay occupies 6.77% of Owls Nest Partners' total portfolio. The hedge fund has increased stakes in the firm by 108% in the past few months. Royce & Associates is a leading shareholder in Repay Holdings Corporation (NASDAQ: RPAY), with 1.13 million shares worth more than $27 million.
Just like Zillow Group, Inc. (NASDAQ: Z), The Ensign Group, Inc. (NASDAQ: ENSG), Progyny, Inc. (NASDAQ: PGNY), and Grand Canyon Education, Inc. (NASDAQ: LOPE), Repay Holdings Corporation (NASDAQ: RPAY) is one of the best stocks according to Philip Timon's Owls Nest Partners.
6. Floor & Decor Holdings, Inc. (NYSE: FND)
Timon's Stake Value: $12,231,000 Percentage of Philip Timon's 13F Portfolio: 7.13% Number of Hedge Fund Holders: 38
Floor & Decor Holdings, Inc. (NYSE: FND) is a multi-channel specialty retailer with hard surface flooring and related accessories. It was incorporated in 2000 and is ranked sixth on the list of 10 best stocks to invest in according to Philip Timon's Owls Nest Partners. Floor & Decor Holdings, Inc. (NYSE: FND) shares have offered investors returns exceeding 84.12% over the course of the past 12 months.
On August 9, Morgan Stanley analyst Simeon Gutman raised the price target on Floor & Decor Holdings, Inc. (NYSE: FND) to $125 from $115 and kept an "Equal Weight" rating on the shares following the recent Q2 results. On August 5, Floor & Decor Holdings, Inc. (NYSE: FND) posted earnings results for the second quarter of 2021. The earnings per share was $0.73, beating market predictions by $0.10. In addition, the revenue over the period was $860.11 million, up 86.0% YoY, beating the estimates by $17.98 million.
The hedge fund managed by Philip Timon holds 128,100 shares in Floor & Decor Holdings, Inc. (NYSE: FND), worth over $12 million, representing 7.13% of their portfolio. As of the end of the first quarter, 38 hedge funds in Insider Monkey’s database of 866 funds held stakes in Floor & Decor Holdings, Inc. (NYSE: FND) compared to 31 funds in the quarter earlier.
Just like Zillow Group, Inc. (NASDAQ: Z), The Ensign Group, Inc. (NASDAQ: ENSG), Progyny, Inc. (NASDAQ: PGNY), and Grand Canyon Education, Inc. (NASDAQ: LOPE), Floor & Decor Holdings, Inc. (NYSE: FND) is one of the best stocks according to Philip Timon's Owls Nest Partners.
Blue Hawk Investment Group, in its fourth-quarter 2020 investor letter, mentioned Floor & Decor Holdings, Inc. (NYSE: FND). Here is what the fund said:
“Floor & Decor contributed almost 500 bps to performance as low interest rates buoyed the housing market. The company briefly paused their 20% annual unit store growth plans amid the pandemic, then reiterated their intention to resume expansion in 2021. With 20% store growth and mid to high single digit comps, we think FND can be a mid to high twenties or greater top-line grower with margin upside for years to come. We think the stock remains significantly undervalued today. We originally started buying the stock around $27 in 2018, a 4x at today’s prices, and we would not be surprised if this stock doubled again over the next 2-3 years. We discuss later in the letter why we may make this our biggest position going forward….”(Click here to see the full text)
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Disclosure: None. 10 Best Stocks to Invest In According to Philip Timon's Owls Nest Partners is originally published on Insider Monkey.