In this article, we discuss the 5 tech stocks to buy according to Billionaire David Tepper. If you want to see our detailed analysis of Tepper’s history, investment philosophy, and hedge fund performance, go directly to the 10Tech Stocks to Buy According to Billionaire David Tepper.
5. Alibaba Group Holding Limited (NYSE:BABA)
Tepper’s Stake Value: $132.6 million
Percentage of David Tepper’s 13F Portfolio: 2.74%
Number of Hedge Fund Holders: 146
Alibaba Group Holding Limited (NYSE:BABA) is a multinational technology company that specializes in e-commerce, retail and cloud computing. Ranked fifth on the list of the 10 tech stocks to buy according to billionaire David Tepper, Alibaba Group Holding Limited (NYSE:BABA) has a market capitalization of $391.96 billion.
David Tepper’s Appaloosa Management currently owns 585,000 shares of Alibaba Group Holding Limited (NYSE:BABA), amounting to $132.6 million in worth and representing 2.74% of the fund’s portfolio. At the end of the second quarter of 2021, 146 hedge funds in the database of Insider Monkey held stakes worth $16.79billion in Alibaba Group Holding Limited (NYS:BABA), down from 135 in the previous quarter with stakes worth $15.4 billion.
On September 6, KGI Securities initiated coverage of Alibaba Group Holding Limited (NYSE: BABA) with a “Neutral” rating and HK$205 price target.
In the Q2 2021 investor letter of RV Capital Management, the fund named Alibaba Group Holding Limited (NYSE:BABA) as its most consequential capital allocation decision. Here is what they had to say:
“The most consequential capital allocation decision in the first half-year was to increase our investment China by purchasing a new position in Alibaba.
I wrote about China in my 2019 half-year letter but given the heightened pessimism in the West today around China, I thought it was worth updating you on my thinking before getting to the discussion of our new investment in Alibaba.
I am conscious that the segue from a discussion on humility to one on China may be jarring. There are, for sure, many people better placed than me to discuss China. I hope, though, that there is value in the perspective of an informed outsider who has invested through several market panics in the past.
What Just Happened?
Over recent months, there has been a growing sense of pessimism bordering on panic about China and its internet companies. From peak in February to trough, aggregate paper losses of the largest Chinese Internet stocks have exceeded US$ 1 trillion.
The roots of the panic can be traced back to last November. Jack Ma, Alibaba’s iconic founder and major shareholder in Ant Group, gave a speech which was critical of financial regulation in China. Shortly afterwards, Ant Group withdrew its IPO plan, giving rise to fears that the Chinese government was turning its back on the market economy. Since then, regulation has spread to other sectors and increased in both frequency and intensity, heightening these fears…” (Click here to see the full text)
4. Alphabet Inc. (NASDAQ:GOOG)
Tepper’s Stake Value: $365.9 million
Percentage of David Tepper’s 13F Portfolio: 7.57%
Number of Hedge Fund Holders: 155
Alphabet Inc. (NASDAQ:GOOG) is a multinational conglomerate that owns and operates several internet-based platforms. Ranked fourth on the list of the 10 tech stocks to buy according to billionaire David Tepper, Alphabet Inc. (NASDAQ:GOOG) has a market capitalization of $1.82 trillion.
On July 27, Alphabet Inc. (NASDAQ:GOOG) issued its quarterly earnings report for the second quarter of 2021, with reported EPS at $27.26, crossing estimates of $19.10 by $8.16. Additionally, the company also reported revenues of $61.88 billion, beating market predictions by $5.80 billion.
According to the recent 13F Filings, Appaloosa Management holds 146,000 shares of Alphabet Inc. (NASDAQ:GOOG), amounting to $395.9 million in worth and accounting for 7.57% of the fund’s investment portfolio. As of the second quarter of 2021, 155 hedge funds tracked by Insider Monkey have positions in Alphabet Inc. (NASDAQ:GOOG), worth over $33.7 billion, compared to 159 in the first quarter, worth $29 billion.
On September 17, Jefferies analyst Brent Thill raised the firm’s price target on Alphabet Inc. (NASDAQ:GOOG) to $3,325 from $3,150 and kept a Buy rating on the shares.
In the Q2 2021 investor letter of Mawer Investment Management, the fund mentioned Alphabet Inc. (NASDAQ:GOOG) among the higher growth companies that reported strong results in the quarter. Here is what the fund said:
“Many higher growth companies reported strong results amid the pick-up in broad economic activity including Alphabet. These higher growth companies tend to have increased sensitivity to a change in discount rates and were supported as long-term interest rates stabilized over the period.”
3. Facebook, Inc. (NASDAQ:FB)
Tepper’s Stake Value: $418.9 million
Percentage of David Tepper’s 13F Portfolio: 8.67%
Number of Hedge Fund Holders: 266
Facebook, Inc. (NASDAQ:FB) is a multinational social networking services company based in Menlo Park, California. The tech giant is ranked third on the list of the 10 tech stocks to buy according to billionaire David Tepper.
David Tepper’s hedge fund presently holds 1.2 million shares in Facebook, Inc. (NASDAQ:FB), amounting to $418.9 million in worth and accounting for 8.67% of the fund’s portfolio. At the end of the second quarter of 2021, 266 hedge funds in the database of Insider Monkey held stakes worth $42 billion in Facebook, Inc. (NASDAQ:FB), compared to 257 in the previous quarter’s worth $40 billion.
In the second quarter of 2021, Facebook, Inc. (NASDAQ:FB) reported EPS of $3.61, beating the estimated EPS by $0.58. Facebook, Inc. (NASDAQ:FB) also reported revenues amounting to $29.08 billion, surpassing market predictions by $1.19 billion.
On September 9, HSBC analyst Nicolas Cote-Colisson raised his price target on Facebook, Inc. (NASDAQ:FB) from $275 to $300 and kept a “Reduce” rating on the shares.
First Eagle Investment Management, an investment management firm, in its Q2 2021 investor letter, stated that Facebook, Inc. (NASDAQ:FB) was among the leading contributors in the fund for the quarter. Here is what the fund said:
“Leading contributors in the First Eagle Global Fund this quarter included Facebook, Inc. Class A. Facebook has continued to post impressive results for both revenue and active users of its traditional platforms. In the meantime, the social media giant continues to make progress on new initiatives—like Facebook Horizon (virtual reality) and Facebook Shops (e-commerce)—and maintains attractive monetization optionality around services like Messenger and WhatsApp.”
2. Amazon.com, Inc. (NASDAQ:AMZN)
Tepper’s Stake Value: $430 million
Percentage of David Tepper’s 13F Portfolio: 8.89%
Number of Hedge Fund Holders:271
Amazon.com, Inc. (NASDAQ:AMZN) is a multinational company that specializes in e-commerce, cloud computing, digital streaming and artificial intelligence. The e-commerce corporation is ranked second of the list of the 10 tech stocks to buy according to billionaire David Tepper.
Amazon.com, Inc. (NASDAQ:AMZN) last released its earnings report on July 28, 2021, with reported earnings per share at $15.12, beating estimates of $12.22. The company also reported revenues of $113.08 billion, falling short of the estimated revenues by $2.01 billion. Earnings for the e-commerce giant are expected to grow by 29.57% in the coming year.
Appaloosa Management currently holds 125,000 shares of Amazon.com, Inc. (NASDAQ:AMZN), amounting to over $212.2 million in worth and accounting for 17.3% of the fund’s portfolio. There were 271 hedge funds in our database that held stakes in Amazon.com, Inc. (NASDAQ:AMZN) worth $60.49 billion in the second quarter of 2021, compared to 243 funds in the first quarter with total stakes amounting to approximately $50.4 billion.
On September 30, RBC Capital analyst Brad Erickson initiated coverage of Amazon.com, Inc. (NASDAQ:AMZN) with an Outperform rating and $4,150 price target, noting that the stock is a favorite among the internet stocks involved with e-commerce.
In the Q2 2021 investor letter of L1 Capital, the fund announced Amazon.com, Inc. (NASDAQ:AMZN) as one of its leading contributors. Here is what the fund said:
“Amazon flipped from being the largest detractor from portfolio performance in the March 2021 quarter, to one of the leading contributors in the June 2021 quarter. We took advantage of negative near-term sentiment in the March 2021 quarter to add to our Amazon investment. We continue to view Amazon as one of the best positioned businesses globally, with its share price still not reflecting fair value.”
1. Micron Technology, Inc. (NASDAQ:MU)
Tepper’s Stake Value: $480.3 million
Percentage of David Tepper’s 13F Portfolio: 9.94%
Number of Hedge Fund Holders: 87
Micron Technology, Inc. (NASDAQ:MU) is a technology company based in Idaho that engages in the design and production of innovative memory and storage solutions. Ranked first on the list of the 10 tech stocks to buy according to billionaire David Tepper, Micron Technology, Inc. (NASDAQ:MU) has a market capitalization of $79.92 billion.
According to the recent 13F Filings, David Tepper’s Appaloosa Management holds 5.65 million shares of Micron Technology, Inc. (NASDAQ:MU), worth $480.3 million and representing 9.94% of the fund’s portfolio. At the end of the second quarter of 2021, 87 hedge funds in the database of Insider Monkey held stakes worth $6.3 billion in Micron Technology (NASDAQ:MU), down from 100 in the preceding quarter worth $7.6 billion.
On September 27, Raymond James analyst Chris Caso lowered the firm’s price target on Micron Technology, Inc. (NASDAQ:MU) to $100 from $120 and kept a Strong Buy rating on the shares.
In its Q1 2021 investor letter, Bonsai Partners, an asset management firm, highlighted Micron Technology (NASDAQ:MU)’s improving results for the quarter. Here is what the fund said:
“Micron is a manufacturer of memory semiconductor chips. Micron appreciated 17.3% during the quarter.
With the semiconductor cycle in full swing, sentiment continued to improve for major DRAM and NAND suppliers. Spot pricing for DRAM continues its upward march due to supply shocks across the industry and sustained demand levels that continue to outstrip supply.
As a result, Micron showed improving results for the fiscal first quarter, raised guidance intra-quarter for the fiscal second quarter, and offered strong guidance for the fiscal third quarter in both growth and margins.
While the cyclical nature of DRAM hasn’t changed, the cycles themselves continue to become more benign, leading to long-term economic improvement across these businesses. Micron is now continuously profitable, with industry players in a dramatically stronger position than even just five years ago.
The biggest negative surprise in the quarter came from Micron’s exit from its 3D XPoint hybrid memory business. The company also announced its decision to sell its accompanying Utah fab. Fortunately, this development does not alter the investment thesis much since 3D XPoint was an option ticket for future growth. While it’s unfortunate this product didn’t pan out, now is an excellent time to sell a fab, so perhaps it is a blessing in disguise?”
You can also take a peek at 10 Cheap Dividend Kings with Over 2% Yield and 12 Best Semiconductor Stocks To Invest In Right Now.
