Both like these two “strong buy” stocks

Is there a right way to invest? Not really. Everyone has their own individual style, but what ultimately counts are the results. This is especially true in the investing arena, where even Wall Street's most successful stock pickers use different strategies to achieve their goals. And what are those goals? Great returns of course.

Take billionaires Steve Cohen and Ken Griffin, for example. Both have had incredible careers, but each path to riches has been different. Griffin, who runs hedge fund Citadel, uses quantitative investing methods, while Cohen, who runs wealth management firm Point72, is known for his high-risk, high-return strategy.

That doesn't mean their stock decisions never cross paths. In fact, some specific stocks are part of the respective portfolios. And when two investment gurus are interested in the same names, it's only natural for investors to be curious as to why both are invested.

With that in mind, we used TipRanks' database to find out whether two stocks that billionaires have recently added to their funds make compelling plays. According to the platform, the analyst community believes this to be the case, and both recommendations receive a Strong Buy consensus rating. Let's look at the details.

Humana Inc. (BUZZ)

Uncertain times make the healthcare sector an ideal target as the sector is seen as one that has defensive qualities and can withstand any harsh macroeconomic developments. So it's not surprising that both Cohen and Griffin have invested in Humana, an American healthcare giant and leading provider of health insurance and related services.

Based in Louisville, Kentucky, the company is one of the largest managed care organizations in the United States and offers a wide range of health insurance products, including individual and group plans, Medicare Advantage and prescription drug plans. Humana serves millions of customers and has a market capitalization of over $64 billion.

Such a value proposition enabled the company to deliver a strong Q1 report. Revenue rose 11.6% year over year to $26.74 billion, beating guidance by $340 million. Likewise in effect, adj. Earnings per share came in at $9.38, beating the $9.20 analysts were expecting. Humana also reiterated its goal for Medicare Advantage (MA) individual membership growth of no less than 775,000 in 2023, a 17% increase from the end of fiscal 2022 while outperforming industry growth.

In terms of big-time participation, Griffin increased its HUM holding by a whopping 2,216% during the first quarter by purchasing 973,754 shares. In total, he now holds 1,017,699 shares, currently valued at $522.4 million. During the same period, Cohen opened a new position by acquiring 189,079 shares of HUM, which currently has a market value of $97 million.

Morgan Stanley's Michael Ha reflects the confidence of these investor heavyweights and highlights the company's growth expectations as key to its investment thesis.

“Given the recent heightened investor concerns about MA growth in 2024, we take a very positive view of mgmt's commentary,” Ha said. “Management expects Humana to meet or exceed HSD's individual Medicare Advantage growth in 2024. We share our belief and continue to expect Humana to deliver the strongest multi-year earnings growth in the managed care space.”

These comments support Ha's overweight (ie, buy) rating, while his price target of $637 suggests the stock will grow 24% over the next 12 months. (To see Has's track record, Click here)

The rest of the street agrees almost unanimously. Aside from one fence sitter, all 15 other recent analyst ratings are positive, making the consensus view here a Strong Buy. Based on the median target of $609.33, the stock will change hands at a premium of about 19% in a year. (See HUM stock forecast)

Cousins ​​Properties (CUZ)

Another way to protect against macroeconomic uncertainty is to invest in real estate investment trusts (REITs), a defensive segment known for its hefty dividends. The next Cohen/Griffin-backed name to take the spotlight here is Cousins ​​Properties.

With a history dating back to 1958, this REIT has established itself as a leading owner, operator and developer of high quality office properties. Cousins ​​Properties is primarily focused on the acquisition, development and management of Class A office buildings in significant markets throughout the Sunbelt region. The Company's portfolio includes a variety of assets including corporate headquarters, urban office towers and suburban office parks.

While some are sounding the alarm about the precarious state of the U.S. commercial real estate market, that didn't stop Cousins ​​from making a compelling statement in the most recent reporting quarter — for Q1 2023. Revenue reached $202.73 million, up 8.5% year over year while beating forecasters' guidance by $7.64 million. At the other end of the scale, the company achieved FFO of $0.65, just above the consensus estimate of $0.63.

Cousins ​​also pays a regular dividend. The current payout is $0.32, giving an inflation-adjusted yield of 6.46%.

All of this must be attractive to Cohen and Griffin. As for her holdings, Cohen pulled the trigger on the stock, buying 1,071,615 shares worth over $23.1 million at the current share price, while Griffin took an even larger position, buying 3,257,081 shares. This move brought the total size of his holdings to 3,295,280 shares, valued at an impressive $71 million.

This stock has also impressed Baird analyst Wes Golladay, who believes CUZ “appears to be well positioned to weather the current macro headwinds the sector is facing.”

“CUZ's late-stage leasing pipeline doubled to 700 ksf in the quarter, including some activity at the Neuhoff project in Nashville,” Golladay wrote after scanning the first-quarter printout. “This pipeline, along with 480ksf signed contracts yet to be addressed this year, will help boost occupancy throughout the year. In addition, CUZ's balance sheet provides the company with the flexibility to take advantage of market price dislocations and expand its best-in-class sun belt portfolio.”

To that end, Golladay rates CUZ stock as Outperform (ie, Buy), backed by a $27 price target. If that figure is reached, investors will be sitting on a 25% return a year from now. (To see Thillman's track record, Click here)

Overall, CUZ has received 7 analyst ratings over the past few months, with 6 “buy” and 1 “hold” making for a “Strong Buy” consensus rating. The stock's average price target of $25.29 suggests that it has 17% upside potential from the current trading price of $21.56. (See CUZ Stock Forecast)

For great stock trading ideas at attractive valuations, visit TipRanks' Best Stocks to Buy, a newly launched tool that brings together all of TipRanks' stock insights.

Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is for informational purposes only. It is very important to do your own analysis before investing.

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