This article presents an overview of the 5 Best Tech Stocks To Buy According to Billionaire Ken Griffin. For a detailed overview of 12 such stocks read our article, 12 Best Tech Stocks To Buy According to Billionaire Ken Griffin.
5. T-Mobile Us Inc (NASDAQ:TMUS)
Ken Griffin’s Stake: $563M
Citadel decreased its take in T-Mobile Us Inc (NASDAQ:TMUS) by 34% in the third quarter, concluding the period with a $563 million stake in T-Mobile Us Inc (NASDAQ:TMUS).
A total of 79 hedge funds tracked by Insider Monkey had stakes in T-Mobile Us Inc (NASDAQ:TMUS) as of the end of the September quarter.
ClearBridge Dividend Strategy made the following comment about T-Mobile US, Inc. (NASDAQ:TMUS) in its Q3 2023 investor letter:
“During the quarter we initiated positions in two new names: T-Mobile US, Inc. (NASDAQ:TMUS) and Gilead Sciences. T-Mobile is the best-in-class player in the wireless space, delivering the strongest growth with the lowest cost structure and the best consumer proposition. T-Mobile’s strength is rooted in its advantaged competitive position. Its superior spectrum holdings enable it to provide better wireless service at meaningfully lower cost. T-Mobile’s annual capital expenditures run about $10 billion, on the order of half the amount its peers must spend. Due to its lower cost structure, T-Mobile can undercut its competitors on price while still generating compelling profitability and returns.
This combination — superior service at lower prices — has enabled T-Mobile to outgrow its competition. In the three years since completing its merger with Sprint, T-Mobile has grown its post-paid subscriber base by about 22%. Over the same period, AT&T’s has grown by about 14%, while Verizon’s by less than 5%.
Given the high fixed-cost nature of the wireless business, these steady increases in revenue growth have led to outsize increases in profits and free cash flow. Free cash flow in 2023 is expected to come in around $13.5 billion, up from less than $8 billion last year. In 2024 free cash flow is expected to grow by over 20% to approximately $17 billion — providing a 10% yield based on today’s stock price.
We have long admired T-Mobile, but until recently the stock did not pay a dividend. The company announced its inaugural dividend in September, and we bought the stock shortly thereafter. The initial yield is about 2% and it is expected to grow about 10% per year.”
4. Adobe Inc (NASDAQ:ADBE)
Ken Griffin’s Stake: $607M
Adobe Inc (NASDAQ:ADBE) ranks 4th in our list of the best tech stocks to buy according to billionaire Ken Griffin. As of the end of the September quarter, Citadel reported owning a $607 million stake in the design tools company.
Here is what Polen Global Growth has to say about Adobe Inc. (NASDAQ:ADBE) in its Q3 2023 investor letter:
“Both Alphabet and Adobe’s businesses continue to perform well. With respect to Adobe, the most recent quarter delivered more of the same with constant currency revenue growing 13%, margin expansion, and over 2% of shares outstanding repurchased for non-GAAP earnings growth of over 20%. We believe its approach to GenAI through Firefly, which guarantees safe content because it trains on Adobe Stock, will continue to be attractive to enterprises. The counter to GenAI, and something we are keeping an eye on with Alphabet and Adobe, is that it requires heavy investment. While both businesses can leverage their scale and manage costs in other areas, we expect the investment in future growth through GenAI will weigh on company-wide margins over the near term.”
3. Apple Inc (NASDAQ:AAPL)
Ken Griffin’s Stake: $719M
Billionaire Ken Griffin loaded up on a whopping 3,381,231 more Apple Inc (NASDAQ:AAPL) shares during the September quarter, boosting his stake in Apple Inc (NASDAQ:AAPL) to a massive $719 million.
Apple Inc (NASDAQ:AAPL) shares were in the spotlight on December 22 after the company halted Apple Watch sales due to a patent dispute.
Wedbush’s Dan Ives recently said he believes Apple Inc (NASDAQ:AAPL) could hit $4 trillion in market cap in 2024.
Hayden Capital made the following comment about Apple Inc. (NASDAQ:AAPL) in its third 2023 investor letter:
“Even Berkshire Hathaway’s most famous investment of the last decade – Apple Inc. (NASDAQ:AAPL) – was based on a similar set up. When Berkshire invested in 2016, Apple’s subscription revenues were just starting to cross ~10% of total revenues. Today, that figure is ~25%.
While operating income has grown +90% from 2016 to 2023, the valuation multiple itself has expanded by ~300%, from ~6x EV/EBIT to ~24x EV/EBIT today.
Investors have evolved their perception of Apple’s products – from that of a “fad” hardware company at risk of competition, to that of a “consumer staple”, a necessary part of a household’s budget…” (Click here to read the full text)
2. NVIDIA Corp (NASDAQ:NVDA)
Ken Griffin’s Stake: $893M
Billionaire Ken Griffin’s Citadel owns an $893 million stake in NVIDIA Corp (NASDAQ:NVDA). The stock has gained about 243% year to date through December 22. Edgewater Research recently said it has seen “mixed” datapoints for NVIDIA Corp’s (NASDAQ:NVDA) GPU demand for the first time in 2023
“Primary customer concern appears pricing; [Nvidia] viewed as likely needing to be more price flexible due to the mandate downgrade in performance,” Edgewater wrote.
As of the end of the September quarter, 180 hedge funds tracked by Insider Monkey had stakes in NVIDIA Corp (NASDAQ:NVDA).
Blue Tower Asset Management made the following comment about NVIDIA Corporation (NASDAQ:NVDA) in its Q3 2023 investor letter:
“In addition to the use of larger datasets, the training speed of AI models has increased dramatically. NVIDIA Corporation (NASDAQ:NVDA)’s stock almost tripled in the first 3 quarters of this year with a 197% gain, and a large reason for this is the huge role they have played in recent AI improvements. Nvidia’s single GPU AI training speed performance has increased by a dramatic 1000x in 10 years with only 2.5x coming from Moore’s Law3 driven increases in chip density. Besides better chip manufacturing, there were three other improvement factors at play: simplifications in number representation for the weights of the neural networks, more complex mathematical instructions for reducing the computational overhead involved in mathematical calculations, and increased neuron sparsity (in neural networks, some neurons are useless and can be pruned from the network without reducing performance significantly). In addition to these single GPU improvements, Nvidia also made improvements in data center scale architecture that allows groups of GPUs to work more efficiently together.
It is noteworthy that the vast majority of the improvement came from hardware architectural and software data improvements, rather than transition density. These improvements were likely the low-hanging fruit of training speed improvements as researchers will eventually converge on an ideal architecture. The simplification of going from 32-bit to 8-bit floating point numbers for measuring weights is a one-time gain that can’t be repeated again. I expect the rate of improvement to slow down over the next ten years and eventually approach the levels of Moore’s Law improvements in chip efficiency. The historical trend for computer hardware is for it to eventually be commoditized, and I believe this will eventually occur for Nvidia’s GPUs as well.”
1. Microsoft Corp (NASDAQ:MSFT)
Ken Griffin’s Stake: $1.6B
It seems the AI-led rally tempted billionaire Ken Griffin to load up on Microsoft Corp (NASDAQ:MSFT) big time in the September quarter, as his hedge fund bought 1,631,542 more Microsoft shares during the period, increasing its stake in Microsoft Corp (NASDAQ:MSFT) to $1.6 billion.
Microsoft Corp (NASDAQ:MSFT) is the most popular stock among the 910 hedge funds tracked by Insider Monkey. A total of 306 funds had stakes in Microsoft Corp (NASDAQ:MSFT).
Here is what White Brook Capital has to say about Microsoft Corporation (NASDAQ:MSFT) in its Q3 2023 investor letter:
“The magnificent seven, that underpin the S&P 500 performance, which includes Microsoft Corporation (NASDAQ:MSFT), now comprise almost 30% of the market capitalization of the S&P500. At least three of the seven stocks have heightened downside risk and suffer from already high penetration, weakening end markets, competitive risk, and lofty valuation. They have been remarkably resilient to increased interest rates and the potential for slowing growth. Small and midcap stocks, on the other hand, have been systemically penalized by fears of recession and continue to price that eventuality even as significantly better outcomes have become more probable. Today, it’s relatively easy to find attractive investments in this segment.”
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