In this piece, we will take a look at the top ten consumer technology stocks to invest in according to Ken Fisher’s Fisher Asset Management. If you want to skip the details about Mr. Fisher and his hedge fund and want to jump ahead to the top five stocks in this list, then head on over to 5 Consumer Technology Stocks to Invest In According to Ken Fisher.
Ken Fisher is an American billionaire who is at the helm of affairs at Fisher Asset Management, one of the largest hedge funds in the world. Mr. Fisher set up his investment firm in 1979 and since then he has seen it grow into what can only be described as a behemoth in the financial world.
The billionaire hedge fund executive graduated with a degree in economics in 1972, even though he had initially planned to study forestry at a community college. Among his billionaire hedge fund peers, Mr. Fisher is one of few who has a diverse theoretical background and interests that are related primarily to the finance and investment sector. He is well known for having written a column for the illustrious Forbes Magazine for 33 years, making him Forbes’ longest contributor.
Apart from his columns, Mr. Fisher is also responsible for some of the financial ratios that are now commonplace in the industry. The most well known ratio out of these is the price to sales ratio, which measures the percentage of a company’s share price that is justified through its net sales. The P/S ratio is now taught across universities and analyst certification courses. He is also one of the pioneers of offering his clients the chance to invest in what are known as “small cap” companies. Prior to Mr. Fisher’s identification, there was no clear definition of the sector.
This trailblazing approach has reaped Mr. Fisher billions of dollars in dividends (the non-balance sheet kind). According to Forbes Magazine, the 71 year old investor’s real time net worth as of April 7, 2022, was equal to $5.4 billion, making him one of the richest people in the world. Mr. Fisher reigned supreme at Fisher Asset Management from 1979 to 2016 as its chief executive officer (CEO). In 2016, he stepped down as CEO but still continues to play a pivotal role at the firm by serving as its executive chairman and co chief investment officer.
While Fisher Asset Management, formally known as Fisher Investments, is headquartered in Camas, Washington, United States, the firm has a global presence. It has a presence in the United Kingdom, Germany, Dubai, Japan, Ireland, and Australia. Additionally, it translates its content to meet the need of a diverse customer base, with Fisher Investments’ content available in 11 different languages apart from English.
The investment firm’s portfolio is also among the largest in the world, and according to Insider Monkey’s research, it was worth $178 billion as the fourth quarter of last year came to an end. In today’s coverage, we will zero in on Fisher Asset Management’s top stock picks in the consumer technology sector. This sector has some of the firm’s largest investments, with the top three being in Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), and Amazon.com, Inc. (NASDAQ:AMZN).
Our Methodology
To pick out Fisher Asset Management’s top consumer technology stocks, we dug through the firm’s filings with the Securities and Exchange Commission for the fourth quarter of last year. This enabled us to identify the companies, following which they were analyzed through their earnings reports, analyst opinion, investor letters, large shareholdings, and hedge fund sentiment gleaned through Insider Monkey’s Q4 2021 survey of 924 hedge funds.
10 Consumer Technology Stocks to Invest In According to Ken Fisher’s Fisher Asset Management
10. Block, Inc. (NYSE:SQ)
Fisher Asset Management’s Stake Value: $547 million
Percentage of Fisher Asset Management’s 13F Portfolio: 0.3%
Number of Hedge Fund Holders: 96
Block, Inc. (NYSE:SQ) is a financial payments firm based out of San Francisco, California. Its technologies allow consumers to make payments via a variety of mechanisms such as magnetic stripe cards, tablet computers, near field communications systems that are embedded in smartphones, and a software application for sending and receiving money.
Fisher Asset Management owned 3.3 million Block, Inc. (NYSE:SQ) shares during the fourth quarter of last year. These were worth $547 million and represented 0.3% of its investment portfolio. During the same time period, 96 of the 924 hedge funds polled by Insider Monkey had also owned a stake in the company.
Block, Inc. (NYSE:SQ) reported $4 billion in revenue and $0.27 in non-GAAP EPS for its fiscal fourth quarter, impressing Wall Street and beating analyst estimates for both. KeyBanc raised the company’s price target to $180 from $175 in April 2022, outlining that strong industry deals and a positive outlook for the financial technology sector will bode well for the company.
Block, Inc. (NYSE:SQ)’s largest investor is Catherine D. Wood’s ARK Investment Management which owns 6 million shares worth $997 million.
RiverPark Funds mentioned the company in its Q1 2021 investor letter. Here is what the fund said:
“We established a position in leading Financial Technology provider Block, Inc. (NYSE:SQ) during the quarter. Through one integrated system, Block, Inc. (NYSE:SQ) is a hybrid of two businesses: its Seller Business (charging small and medium-sized businesses about 3% for transaction payment processing, plus other services such as instant funds access, and software for everything from customer engagement to payroll), and its Cash App (originally for person-to-person cash transfers and now a growing digital financial services provider for consumers).
The combined business has grown gross profit at a 37% CAGR over the past five years to $2.7 billion (due to pass through costs, gross profit is more reflective of top-line growth) and we believe that Block, Inc. (NYSE:SQ) has an enormous long-term runway, as it has less than a 2% share of a more than $160 billion market. It is our view that the company’s Cash App (which has grown from nothing in 2015 to $1.2 billion gross profit last year) has a particularly large opportunity with its powerful ecosystem of digital financial services including digital wallets, direct deposits, stock trading, bitcoin trading, and business and tax services, which are all relatively new. The vast majority of Cash App’s more than 36 million users are younger and, importantly, are willing to replace their bank and other financial services accounts with the app.
We estimate that Block, Inc. (NYSE:SQ) can grow its gross profit more than 30% and EBITDA more than 50% annually for the foreseeable future, and while most of the company’s current profit is from its Seller Business, we believe most of the company’s future value will be from its Cash App business.”
Along with Microsoft Corporation (NASDAQ:MSFT), Apple Inc. (NASDAQ:AAPL), and Amazon.com, Inc. (NASDAQ:AMZN), Block, Inc. (NYSE:SQ) is a favorite Fisher Investment stock pick.
9. Uber Technologies, Inc. (NYSE:UBER)
Fisher Asset Management’s Stake Value: $635 million
Percentage of Fisher Asset Management’s 13F Portfolio: 0.35%
Number of Hedge Fund Holders: 153
Uber Technologies, Inc. (NYSE:UBER) is a ridesharing services provider that uses its software application to connect consumers looking for a ride with drivers willing to offer it. Additionally, it also provides delivery services and is expanding into the electric vertical take off and landing vehicle market.
For its fiscal fourth quarter, Uber Technologies, Inc. (NYSE:UBER) raked in $5.7 billion in revenue and $0.44 in GAAP EPS, beating analyst estimates for both. Mizuho kept a $72 price target for the company in April 2022, stating that the company will pass additional costs from a recent law passed by Washington state down to the consumer.
Mr. Fisher’s investment firm held a $635 million stake in Uber Technologies, Inc. (NYSE:UBER) during Q4 2021. This came via 15 million shares and represented 0.35% of its portfolio. During the same time, 153 of the 924 hedge funds polled by Insider Monkey had also invested in the firm.
Chase Coleman and Feroz Dewan’s Tiger Global Management LLC is Uber Technologies, Inc. (NYSE:UBER)’s largest investor through a $756 million stake that comes from owning 18 million shares.
ClearBridge Investments mentioned the company in its Q3 2021 investor letter and outlined that:
“We have also been looking for multiyear secular trends outside of the IT and Internet sectors to help us maintain a portfolio that can perform well in markets with varied sector or factor leadership. In particular, electrification of the global economy and the transition to electric vehicles (EVs) are areas where we continue to add exposure. We are investing in the brains behind EVs through NXP in the control center and Aptiv for safety features. Global rideshare leader Uber Technologies, Inc. (NYSE:UBER) will also be a key player in the transition from internal combustion engines to EVs.”
8. Intel Corporation (NASDAQ:INTC)
Fisher Asset Management’s Stake Value: $775 million
Percentage of Fisher Asset Management’s 13F Portfolio: 0.43%
Number of Hedge Fund Holders: 72
Intel Corporation (NASDAQ:INTC) is the largest semiconductor firm in the world that is responsible for both designing and manufacturing central processing units and graphics processing units. These are used by the everyday consumer in products such as notebook computers and desktop PCs.
Intel Corporation (NASDAQ:INTC) reported $19.5 billion in revenue and $1.09 in non-GAAP EPS as its fiscal fourth quarter came to an end, enabling it to beat analyst estimates for both. Raymond James cited optimism about the company’s share price in February 2022, as it upgraded the share rating to Market Perform. It justified the decision by claiming that the shares should not significantly underperform the market in the near future.
Fisher Asset Management held 15 million Intel Corporation (NASDAQ:INTC) shares worth $775 million during the fourth quarter of last year. 72 out of the 924 hedge funds part of Insider Monkey’s Q4 2021 survey owned a stake in the company.
Intel Corporation (NASDAQ:INTC)’s largest investor according to Insider Monkey’s research is Seth Klarman’s Baupost Group. It holds 18 million shares for a $928 million stake.
Third Point Management mentioned Intel Corporation (NASDAQ:INTC) in its fourth quarter 2021 investor letter. Here is what the fund said:
“2021 was a highly productive year for Intel‘s new CEO, Pat Gelsinger. Despite the stock’s tepid results, we see a compelling, underappreciated fundamental story. Intel’s “brain drain” – a key part of our thesis when we first sought to help the company confront its long-time underperformance – appears to be reversing. Since joining Intel, Mr. Gelsinger has not only brought back prominent Intel former employees but has also attracted talents from competitors such as Advanced Micro Devices, Inc. (NASDAQ:AMD), Nvidia, Apple, and, most recently, Micron’s stellar Chief Financial Officer, David Zinsner.
We are encouraged by Intel Corporation (NASDAQ:INTC)’s aggressive investment plan, including a recently announced fabrication plant in Ohio and acquisition of Tower Semiconductors. We knew from the start that Intel’s turnaround would be complex and lengthy, and we have been pleased to see Mr. Gelsinger sacrifice near-term earnings for long-term growth.
Finally, after a series of blunders across its PC and Server product lines, Intel is finally receiving good reviews for one of its upcoming processors: Alder Lake. Tom’s Hardware, a preeminent hardware publication, called Alder Lake “a cataclysmic shift in Intel Corporation (NASDAQ:INTC)’s battle against AMD’s potent Ryzen 5000 chips.” While this is just one product across a broad lineup, and given it will take time to achieve leadership across them all, we are encouraged by these tangible signs of progress under Mr. Gelsinger’s leadership. With talent returning, an improving product suite, and a willingness to invest for growth, we believe Intel’s prospects have turned the corner. We expect that the company’s upcoming analyst day will be an ideal time for Mr. Gelsinger to articulate the progress he has made and begin to reset expectations for the company.”
7. NVIDIA Corporation (NASDAQ:NVDA)
Fisher Asset Management’s Stake Value: $1.5 billion
Percentage of Fisher Asset Management’s 13F Portfolio: 0.84%
Number of Hedge Fund Holders: 110
NVIDIA Corporation (NASDAQ:NVDA) is an American company that designs and sells graphics processing units (GPUs). These are used by both enterprises and everyday consumers, with the latter using them for a variety of purposes such as rendering and creating content alongside running video games.
Fisher Asset Management’s Q4 2021 stake in NVIDIA Corporation (NASDAQ:NVDA) was worth $1.5 billion, making it the company’s largest investor according to Insider Monkey’s research. This stake came through 5.1 million shares. 110 of the 924 hedge funds surveyed by Insider Monkey during the same time period had also held the company’s shares.
By the end of its fiscal fourth quarter, NVIDIA Corporation (NASDAQ:NVDA) reported $7.6 billion in revenue and $1.32 in non-GAAP EPS beating analyst estimates for both. Tigress Financial raised the company’s share price target to $410 from $400 in March 2022, as it shared its belief that NVIDIA Corporation (NASDAQ:NVDA) has a strong hold on artificial intelligence, enabling it to become a world leader in the technology.
Harding Loevner mentioned the company in its third quarter 20221 investor letter and outlined that:
“The proliferation of devices using chips, whether EVs, “things” in lol, or embedded systems more generally, results in the generation of oceans of data potentially needing to be stored, processed, and analyzed. NVIDIA, the leading chip designer wellknown for its graphic processing units and its complementary CUDA software ecosystem, is at the forefront of the effort to provide the analytical platform needed to unlock the full potential of such specialist processors.”
6. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Fisher Asset Management’s Stake Value: $2.8 billion
Percentage of Fisher Asset Management’s 13F Portfolio: 1.6%
Number of Hedge Fund Holders: 69
Advanced Micro Devices, Inc. (NASDAQ:AMD) is a personal computing firm that designs and sells both central processing units (CPUs) and graphics processing units (GPUs). These are used in computers and gaming consoles, both of which are consumer devices used for a wide variety of productivity and entertainment applications.
By the end of its fiscal fourth quarter, Advanced Micro Devices, Inc. (NASDAQ:AMD) had brought in $4.8 billion in revenue and $0.92 in non-GAAP EPS for a record setting set of results that also beat analyst estimates. Building upon its recent strategy of acquisitions, the company announced in April 2022 that it would acquire an enterprise computing firm for $1.9 billion.
Mr. Fisher’s investment firm had a $2.8 billion stake in Advanced Micro Devices, Inc. (NASDAQ:AMD) during the fourth quarter of last year which came in the form of 19.9 million shares in Q4 2021. During the same time period, 69 out of the 924 hedge funds polled by Insider Monkey had invested in the firm.
Carillon Tower Advisers commented on Advanced Micro Devices, Inc. (NASDAQ:AMD) in its Q4 2021 investor letter, outlining that:
“Advanced Micro Devices (AMD) supplies semiconductor chips for central processing units (CPUs) and graphic processing units (GPUs). The firm has been gaining share against its primary competitor in the datacenter server CPU space, as this rival has been unable to match the design and manufacturing capabilities of AMD and its partners. Investors are also looking forward to the closing of the previously announced merger with a semiconductor manufacturer that is another one of the portfolio’s holdings. The merger will increase AMD’s capabilities in the Field Programmable Gate Array (FPGA) chip space, and the combined company should possess the potential to win additional market share in the datacenter chip market.”
Advanced Micro Devices, Inc. (NASDAQ:AMD) joins Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), and Amazon.com, Inc. (NASDAQ:AMZN) in the list of Mr. Fisher’s favorite consumer technology stocks.
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Disclosure: None. 10 Consumer Technology Stocks to Invest In According to Ken Fisher. is originally published on Insider Monkey.
