George Soros stands out among the stock legends. No one can question his financial savvy, despite the uproar, his political activities have caused. He is, after all, known as the “man who broke the Bank of England” and won a billion dollars in a single day in 1992 when he shorted the British pound.
Through the year 2000, the returns on his hedge fund, Soros Fund Management, averaged 30% annually and were consistent across three decades. Soros has always been a risk-taker when managing his personal wealth, and he has never shied away from making trades based on news and rumors of major world events.
We [at Soros Fund Management] utilize options and more sophisticated derivatives sparingly, Soros once famously said. We strive to spot emerging trends early on, and later on, we look for trend reversals. As a result, we frequently stabilize the market rather than disrupt it. We are not providing a public service by doing this. It is how we like to get paid.
Therefore, it makes sense that investors would pay attention when Soros made a move. In light of this, we made the decision to investigate two stocks that his fund recently bought a lot of. Not just Soros, but Wall Street analysts also appear to be bullish on these stocks, according to the TipRanks database. Both are rated as Strong Buys.
Sands of Las Vegas (LVS)
The first is Soros’s new job at Las Vegas Sands. Although there are no longer any entertainment and resort locations in Vegas, this casino and resort firm has a storied reputation in its city. Sands, which is still headquartered in Las Vegas, has now shifted its attention to the global leisure market and currently owns six hotels, including one in Singapore and five in the port city of Macao on China’s southern coast.
However, according to the company’s financial reports, constraints brought on by the epidemic are still having a negative impact on earnings. This is especially important because the majority of Sands’ properties are in Macao, where Chinese authorities have not shied away from closing down entire cities and limiting travel. Nevertheless, Sands reported net revenue of $1.05 billion for the most recent quarter, 2Q22. This was less than the $1.17 billion reported for the same quarter last year. In addition, the company reported a $414 million net loss from continuing operations, up from $280 million in 2Q21.
The revenue from Sands’ Singapore property doubled despite the overall losses in Q2. With net revenues of $679 million, the city’s Marina Bay Sands reported an EBITDA of $319 million. In contrast, net revenues in the same period last year were $327 million.
Since finishing the sale of its US businesses, Sands has only released its quarterly earnings for 2Q22. This sale was completed in February of this year for a total of $6.25 billion to VICI Properties and Apollo Global Management.
As previously mentioned, George Soros has a new investment in this stock, and over the past three months, he purchased a total of 220,000 shares. This position is currently worth about $8.26 million at current prices.
In a thorough defense of the LVS bulls, Credit Suisse analyst Benjamin Chaiken writes of the stock: “LVS has held up nicely YTD and we think it should continue to outperform. The balance sheet is in excellent shape, Singapore is accelerating, Macau can’t get any worse (casinos closed), and the Singapore rebound—which came much faster than we anticipated—may shed some light on what a potential Macau recovery might be entail (perhaps). We believe the stock should have strong support at around $30 since you are embedding zero Macau value at that price.
Unsurprisingly, Chaiken rates the LVS shares as Outperform (or Buy), and his $59 12-month target price implies a gain of 56% is in store.
The majority is undoubtedly bullish based on the split of analyst ratings. Out of 9 recent evaluations, 8 have resulted in Buys, with only one Sell. Overall, this results in the consensus rating of Strong Buy for LVS shares. The average price objective of $47.78 represents a 26% one-year gain for the company, which is currently trading at $37.72. (View TipRanks’ LVS stock forecast.)
Inc. Salesforce (CRM)
We’ll shift to the tech and marketing sectors for the next stock, where Salesforce has long been a market leader. The company’s major offering, Customer Relationship Management (CRM) software packages, is whence it derives its ticker, CRM. These are provided as cloud-based services using the well-liked SaaS subscription model. Enterprise customers of Salesforce utilize the solutions to manage and address front-end marketing problems.
Salesforce will announce its fiscal year 2023 Q2 numbers later this month, but we can look back to the company’s fiscal first quarter and recent patterns to get a sense of where it is right now.
Salesforce’s fiscal 1Q23 saw a $7.41 billion top line, up 24% from the same quarter last year and the company’s highest revenue performance in the previous two years. Additionally, the company’s operating cash flow for the quarter increased significantly year over year by 14% to reach $3.68 billion.
Negatively, the company’s reported non-GAAP diluted EPS decreased from the $1.21 recorded a year earlier to 98 cents per share.
We should be aware that Salesforce has predicted sales for fiscal 2Q23 of $7.69 billion to $7.70 billion, or a 20% rise over last year. Salesforce is projecting a top line for the entire fiscal year 2023 between $31.7 billion and $31.8 billion. This would result in an increase in revenue of 20% year over year.
Soros previously owned stock in this company; in the most recent quarter, he increased his holdings by 138%. His initial investment in CRM was made in 1Q21, and his most recent purchase increased his holdings by 364,209 shares. As of right now, Soros owns 627,509 Salesforce shares valued at about $115,24 million.
This tech stock is receiving support from other investors than Soros. Salesforce is “the most appealing risk/reward in software,” according to Morgan Stanley’s 5-star analyst Keith Weiss. He continues, “We anticipate that Salesforce will have longer-lasting demand growth due to its unique exposure to the broadest of Digital Transformation activities focused on enhancing automation and efficiencies. Additionally, partners have reported early indications of potential budget consolidation in the IT sector, a development that benefits Salesforce from the depth of its platform. We think that a downturn in the industry, whether it be macroeconomic or organic, is already more than priced in at the moment.
In accordance with these remarks, Weiss grades CRM stock as Overweight (Buy), and his $273 price estimate suggests a 49% increase in value over the following year. (To view Weiss’s résumé, go here.)
With a $182 billion market cap, Salesforce is a sizable organization that has drawn a lot of Wall Street attention. 32 analyst opinions have been submitted for this stock, and the consensus recommendation is a strong buy with 27 buys, 4 holds, and 1 sell. With an average price objective of $240.70 and a current price of $183.33, the stock is expected to rise by 31% over the course of the next year.