MasterCard, Inc. (MA) continues to navigate market volatility and nip at the heels of the S&P 500. As of July 2022, MasterCard slid to a loss of approximately 8% compared to the S&P 500’s loss of about 7% over the past year. The company advanced on the WhaleWisdom Heatmap in the first quarter of 2022 to a rank of seven from twenty-five.

MasterCard is a technology company in the global payments industry. While known worldwide for its MasterCard credit card brand, the company offers payment solutions that include credit, debit, prepaid, commercial, and payment programs and solutions for consumers and merchants. MasterCard earns revenue primarily from fees paid by financial institutions and switched transaction fees covering authorization. The company earns income based on the number of transactions completed for financial institutions that issue their card and the dollar volume of transactions. During a challenging economic time of high inflation, consumer spending continues to rise, bringing steady revenue to MasterCard.

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Hedge Funds Sell

Hedge funds were selling the stock in the first quarter of 2022, with the aggregate 13F shares held lowered to approximately 152.99 million from 153.01 million, a change of roughly 0.01%. Of the hedge funds, 45 created new positions, 183 added, 46 exited, and 193 reduced their stakes. Institutions sold and decreased their aggregate holdings by about 1.2% to approximately 726.1 million from 735.1 million.

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Positive Earnings Estimates

Analysts expect to see earnings increase in 2022 and 2023, bringing earnings per share to $12.65 by December 2023, up from an estimated $10.52 for December 2022. Revenue estimates are also encouraging, with an anticipated rise to approximately $22.2 billion by December 2022 and an estimated revenue of about $25.9 billion by December 2023. The 13F metrics between 2012 and 2022 show that funds held remained reasonably steady, despite MasterCard’s more recent fluctuating stock price.

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Analysts Pull Price Targets

Analysts have been lowering price targets on MasterCard’s stock. Analyst Darrin Peller of Wolfe Research, LLC lowered the firm’s price target on the stock to $415 from $465 and kept an Outperform rating. Wolfe described MasterCard as a resilient business and believes it started to benefit from inflation. JP Morgan analyst Tien-tsin Huang kept an Outperform rating on MasterCard’s stock and adjusted the firm’s price target to $425 from $430. Analyst David Koning from Baird Capital lowered the firm’s price target on MasterCard to $416 from $470.

Optimistic Outlook Beyond 2022

MasterCard’s 2023 revenue and earnings estimates are encouraging after a rocky performance period to date in 2022. Analysts have lowered price targets, though indications are that the stock will rebound. MasterCard may be an opportunity best suited for patient investors.

Meta Platforms, Inc. (META) stock has underperformed the S&P 500, falling by over 50% compared to the S&P 500’s loss of around 12% over the past year. Meta experienced a slowdown in performance, and hedge funds have been actively selling the stock. The shares had a rank of twelve on the WhaleWisdom Heatmap for the first quarter of 2022.

Meta Platforms is a technology conglomerate that develops products for people to connect and share worldwide. The company was formerly known as Facebook, Inc. and Meta Platforms now operates a family of applications and its Facebook Reality labs. Meta Platforms’ products and services include Facebook, WhatsApp, Instagram, Giphy, and Oculus, among others. The latest stock market correction during a time of high inflation and interest rate hikes has negatively affected Meta Platforms, as it has other technology companies. Through the volatility, Meta Platforms has drawn revenue from its successful digital advertising business and continues to develop the Metaverse, promoted as the future of the internet.

Institutions and Hedge Funds Were Selling

Institutions overall were selling the stock, with the number of aggregate 13F shares decreasing by about 6.9% as of March 31, 2022. Hedge funds trimmed portfolios in the first quarter, reducing claims by roughly 7.8%. Reviewing hedge fund activity, 63 created new positions, 265 added, 110 exited, and 252 decreased their stake. Meta Platforms’ 13F metrics show that the number of hedge funds and institutions has held steady over the past decade. However, Meta’s stock value has faced more volatility over the past two years.

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Positive Earnings Estimates

Analysts expect to see earnings increase in 2022 and 2023, bringing earnings per share to $13.54 by December 2023, up from an estimated $11.54 for December 2022. Revenue estimates are also encouraging, with an anticipated rise by the end of 2022 to approximately $125 billion and continue to rise to an estimated $143.8 billion by December 2023.

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Analysts Lower Price Targets

Many analysts lowered price targets after first-quarter earnings were announced. Ronald Josey of Citi kept a Buy rating on shares while reducing the firm’s price target on the company to $270 from $300 amidst increased macroeconomic headwinds. Analyst John Blackledge of Cowen Inc. lowered his firm’s price target to $275 from $300 due to estimates of slowing advertising spending and kept an Outperform rating on the stock. Analyst Laura Martin of Needham & Co. downgraded Meta Platforms to Underperform from Hold, noting the impact of consumer behavior shifts, competitions, regulatory risks, and the company’s investment in the Metaverse as contributing factors.

Favorable Long-term Outlook

Meta Platforms has a history of growth, despite the recent downturn. While hedge funds were selling in this volatile market, analysts recognize that advertising is a continued source of revenue as the company also builds the metaverse. Analysts’ earnings estimates make this stock more attractive, as it will likely rebound and reward patient investors.

CoStar Group, Inc. (CSGP) saw its stock dip amid a volatile market this year. CoStar Group continues to underperform the S&P 500, falling approximately 24% year to date, while the S&P was down about 20% as of July 2022. Amidst stock fluctuations this year, hedge funds were actively buying the stock in the first quarter, and CoStar Group was added to the WhaleWisdom WhaleIndex 100 on May 17, 2022.

CoStar Group provides data, analytics, and marketing services to the commercial and residential real estate industry. The company has an integrated suite of online marketplaces and an online database called CoStar. Some of its more well-known online marketplaces include Apartments.com and BizBuySell. CoStar Group generates revenue from the subscription fees it charges customers to access its research database and marketplace.

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Hedge Funds and Institutions Are Buying

CoStar Group has received positive attention from both hedge funds and institutions. Hedge funds increased their aggregate 13F shares to approximately 95.5 million from about 90.6 million, roughly a 5.4% increase during the first quarter. Overall, 26 hedge funds created new positions, 58 added, 37 exited, and 45 reduced their holdings. Institutions increased their aggregate holdings by about 0.1% to approximately 374.1 million from 373.9 million. The 13F metrics across the past twenty years show that share value remains on a gradual upward trend.

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Encouraging Multi-year Estimates

Analysts expect to see earnings rise, with increases in growth that could bring earnings to

$1.28 by December 2023, up from an estimated $1.02 for December 2022. Estimates are also optimistic for revenue, with an anticipated rise by the end of 2022 to approximately $2.2 billion. Continued momentum may bring revenue of about $2.5 billion by December 2023.

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Analysts Raise Price Targets

Mayank Tandon of Needham & Co. raised the firm’s price target on CoStar Group to $77 from $70 while maintaining a Buy rating. CoStar Group performed better than expected in the first quarter. Tandon noted that strong demand across the company’s business lines impacted the results. Citi analyst Peter Christiansen also kept a Buy rating on shares. Christiansen raised the firm’s price target on CoStar Group to $70 from $65 following solid first-quarter results.

Optimistic Outlook Beyond 2022

While CoStar Group’s growth has slowed, 2023 revenue and earnings estimates are encouraging. Analysts raised their price targets and appeared to view the company as a Buy. With CoStar’s track record of growth and good earnings forecast for 2023, CoStar Group may be a good opportunity for patient investors.

Thermo Fisher Scientific, Inc. (TMO) saw growth slow over the past six months. Despite a bear market, the life sciences company still outperformed the S&P500 and rose by approximately 5% compared to the S&P’s loss of about 10% over the past year. Hedge funds sold the stock in the first quarter, but it was still added to the WhaleWisdom Whale 100 index on May 17, 2022.

Thermo Fisher provides medical equipment, analytical instruments, reagents and consumables, software, and services for research analysis, diagnostics, and clinical laboratories. Thermo Fisher formed when the companies Thermo Electron and Fisher Scientific merged in 2006 and has since acquired other businesses to expand its life sciences presence. The company comprises four business segments: Analytical Technologies, Specialty Diagnostics, Life Sciences Solutions, and Laboratory Products and Services. Thermo Fisher was vital in delivering medical treatments during the Coronavirus pandemic. The company supplies specialty diagnostic tools and equipment to pharmaceutical and other healthcare companies to aid in clinical research of the Coronavirus and vaccine and medical treatment manufacturing.

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Hedge Funds Trim Portfolios

Thermo Fisher saw hedge funds and institutions decreasing holdings in their portfolio in the first quarter of 2022. The aggregate 13F shares held by hedge funds decreased to about 61.5 million from 61.9 million, a change of about 0.6%. Of the hedge funds, 28 created new positions, 133 added to an existing holding, 43 exited, and 179 reduced their stakes. Overall, institutions sold and decreased their aggregate holdings by about 1.3% to approximately 338.0 million from 342.4 million. The long-term 13F metrics between 2005 and 2022 demonstrate that Thermo Fisher’s investment potential maintains an upward trend.

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Favorable Multi-year Estimates

Analysts expect to see earnings rise through 2023, with a year-over-year estimated increase bringing earnings to $24.50 per share by December 2023, up from $22.79 for 2022. Revenue forecasts are also encouraging, with revenue expected to increase to $44.5 billion by 2023, up from a predicted $42.5 billion by 2022.

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Favorable Outlook

Thermo Fisher’s earnings estimates for 2022 and 2023 are encouraging for investors. While growth may have recently slowed, healthcare spending continues to rise, and the life sciences giant is well-positioned to respond to emerging needs. The stock’s trends suggest a long-term opportunity for investors.

Johnson & Johnson Co. (JNJ) has seen slower growth over the past year but, in recent months, has shown its ability to outperform the S&P 500. Johnson & Johnson rose by approximately 10% compared to the S&P’s loss of about 10% over the past year. Hedge funds were buying in the first quarter, and this healthcare-focused holding company was added to the WhaleWisdom WhaleIndex on May 17, 2022.

Johnson & Johnson is an investment holding company that develops pharmaceuticals, medical devices, and consumer personal care goods. Johnson & Johnson has three business segments: Consumer, Pharmaceutical, and Medical Devices. Its Consumer segment is well known for products such as Band-Aid bandages, Neutrogena skin care products, and Johnson’s Baby products. Its Medical Devices segment is utilized across hospitals, retailers, and wholesalers. The Pharmaceutical segment focuses on vaccines, infectious diseases, oncology, pain management, contraception, and neurology, among other products.

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Its company includes about 250 subsidiary companies with operations and sales worldwide, though its pharmaceutical business represents most of the sales revenue. The company engages in research and development through its pharmaceutical arm, Janssen Pharmaceutica. Johnson & Johnson announced in late 2021 that it plans to separate the pharmaceutical business from consumer products by late 2023. This significant change also comes amid ongoing legal challenges for the conglomerate related to its baby powder product. As the 2023 business changes approach, Johnson & Johnson appears focused on being a leader in the pharmaceutical and medical technology industries.

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Mixed Actions from Institutions and Hedge Funds

Johnson & Johnson’s stock saw hedge funds buying in the first quarter, with the aggregate 13F shares held increasing to about 296.80 million from 296.77 million, a mild change of approximately 0.01%. Of the hedge funds, 32 created new positions, 216 added, 30 exited, and 200 reduced their positions. In contrast to hedge funds, institutions sold and decreased their aggregate holdings by about 0.9% to approximately 1.80 billion from 1.81 billion. Johnson & Johnson’s long-term 13F metrics between 2004 and 2022 show that the company remains on an upward growth trend for the stock price and funds helds.

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Positive Earnings Estimates

Analysts expect to see earnings increase in 2022 and 2023, bringing earnings per share to $10.88 by December 2023, up from an estimated $10.26 for December 2022. Estimates are also encouraging for revenue, with an anticipated rise to approximately $96.5 billion by December 2022 and an estimated revenue of about $100.2 billion by December 2023.

Analysts Are Both Optimistic & Cautious

David Risinger of SVB Securities gave Johnson & Johnson an Outperform rating and a $200 price target, sharing expectations that the company will outperform the S&P 500 based upon consistent past earnings growth. Risinger is optimistic that the Medical Devices segment will continue to see sales growth in 2022 and 2023 and noted that Johnson & Johnson will exit from the Consumer segment in 2023. Citi analyst Joanne Wuensch gave Johnson & Johnson a Buy rating and lowered the firm’s price target to $205 from $210. Wuensch noted the impact of higher inflation and interest rates on the market, which is slowing growth for many companies and could also impact the medical technology industry.

Bright Outlook

Johnson & Johnson’s earnings estimates through 2023 are encouraging for investors. While growth may slow amid market volatility, the healthcare conglomerate and holding company has a strong track record of outperforming the S&P. Analysts appear bullish on the medical device and pharmaceutical businesses, and the stock’s trends suggest a long-term opportunity for investors.