Third Point Partners Qualified gained 2.5% in February, bringing its year-to-date return to 4.7%. A couple of the more interesting moves last month involved chipmaker NVIDIA, a stock some would say you should never sell.
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Top contributor: Keysight Technologies
According to an email seen by Hedge Fund Alpha, Third Point’s top contributors included Keysight Technologies, Generac Holdings and Carpenter Technologies, a name that was featured in a recent issue of our recent Hidden Value Stocks newsletter.
Shares of Keysight exploded in February, rising 42% after robust earnings results that came on the back of widespread demand across data centers, wireless, aerospace and defense, and electronics, automotive, semiconductors, and energy. Keysight’s guidance suggests a meaningful expansion in margins starting in the second quarter.
According to Third Point’s Dan Loeb, Keysight is still the market leader in test equipment for R&D, and the firm sees the company as a “quality compounder emerging from a wireless cyclical downturn.” The Third Point team also sees increasing momentum across data center networking, next-generation defense systems, and satellite networks.
Generac Holdings
Shares of Generac popped 34% last month. Third Point just initiated this position in January in the wake of the selloff related to residential demand concerns, viewing it as overdone. On the earnings call in February, Generac management focused on robust sequential growth in data center backlog along with plans to double data center capacity going out of this year, which sent the stock soaring.
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