Below are Billionaire Chris Rokos’ top 5 stock picks. For a comprehensive list and Rokos’ business strategy please see Billionaire Chris Rokos’ Top 10 Stock Picks.
5. QUALCOMM Incorporated (NASDAQ: QCOM)
The London-based hedge fund first initiated a position in Qualcomm Inc (NASDAQ: QCOM) during the third quarter and left its position unchanged during the fourth quarter. QCOM is ranked fifth in the list of billionaire Chris Rokos’ top 10 stock picks for 2021.
In the Q4 investors’ letter, Alger Spectra Fund stated that QUALCOMM has more upside ahead amid robust demand for chips. Here is what Alger Spectra Fund said:
“Qualcomm is a leading semiconductor company with strong positions in telecommunications end markets that position the company as a primary beneficiary of the innovative 5G network standard rollout. Qualcomm is commonly acknowledged as having the best technology specs for 5Gchipsets as evidenced by signing up all 75 major original equipment manufacturers of telephone handsets including Apple. Additionally, beyond handsets, Qualcomm is positioned to generate growth from automobile manufacturers, the Internet of Things, gaming and other markets.
The shares contributed to performance because Qualcomm’s earnings beat expectations in the face of coronavirus driven declines in the broad handset market. Importantly, the market is improving as the magnitude of handset declines is diminishing sequentially. Qualcomm’s fundamentals are benefitting from a faster-than-expected shift to the 5G standard. As such, the company’s 5G guidance exceeded expectations.”
4. Alphabet Inc. (NASDAQ: GOOG)
Shares of Alphabet outperformed the broader market trend in 2021 amid an improving outlook for ads revenue. Chris Rokos’ hedge fund first initiated a position in Alphabet during the third quarter of 2020 and added to its existing position in Q4. The firm held 81,324 shares of Google parent Alphabet at the end of the latest quarter.
GoodHaven Capital Management, a concentrated portfolio investment management firm, stated in the Q4 investors’ letter that Google is likely to extend the growth trend in 2021. Here is what GoodHaven Capital Management said:
“Alphabet’s family of digital advertising platforms continues to quickly recover from the global economic downturn in the spring and as we expected earnings growth has resumed. In a surprise to nobody, the U.S. Department of Justice, FTC, and many state enforcement agencies are marching forward on their myriad of anti-competitive legal actions against Alphabet. We think these issues are manageable though hardly trivial. By the way, we own parts of businesses, and there are always things to worry and think about that might impact those businesses. Often, the more important things to focus on get less attention from prognosticators. At Alphabet, for instance, we have long focused on the inter-play of their historic relationship with Apple – where Alphabet appears to pay Apple at least $7 billion/year to be the default search engine on all iOS devices. This relationship figures prominently in some of the enforcement action(s) but until recently was less frequently discussed. It was, however, something we had long spent time considering and the type of deeper analysis we focus on for all our companies. Alphabet’s top line grew a very impressive 15% in Q3 2020 with many aspects of digital advertising still depressed from COVID-19. That implies that other parts of the Alphabet ecosystem – such as Cloud, Google Play and YouTube grew faster. Google shopping’s decision earlier this year to reduce listing barriers appears thoughtful. We’d think that growth overall at Alphabet could accelerate in 2021. At a below market adjusted P/E multiple we see plenty of upside over time.”
3. Apple Inc. (NASDAQ: AAPL)
The world’s largest technology giant Apple (NASDAQ: AAPL) is among the billionaire Chris Rokos’ top 10 stock picks for 2021. Shares of the most prominent smartphone seller fell significantly in 2021 due to investors’ shift towards growth stocks. Apple stock price is down 8% year to date. Rokos’ initiated a new position in Apple during Q4 by purchasing more than 1.2 million shares.
Artisan Partners Limited Partnership, a high value-added investment management firm, highlighted few stocks including Apple in the Q4 investors’ letter. Here is what Artisan Partners Limited Partnership said:
“We fully exited position in Apple. Apple is a global designer, manufacturer and seller of smartphones, personal computers, tablets, wearables and accessories, which also has a rapidly growing and highly profitable services business. We had been shareholders since 2011, owning Apple in various sizes throughout our investment campaign. Apple remained in the portfolio all these years because the market systematically assigned the company an undemanding asking price despite characteristics which should command a premium. Our differentiated view was Apple had “won” in the smartphone business along with their other product categories as its iOS operating system tied users into an ecosystem and rising services adoption led to increased switching costs for users. Survey data showed users were as happy with Apple products as ever, too. With all these traits in place, the result was a rising installed base and each user becoming more valuable due to services attach rates. When combined with an average asking price, tremendous free cash flow generation, and management pointing all cash flow back to shareholders, the odds of a strong return were heavily tilted in our favor. Apple is likely to remain an extraordinary business for years to come, but we can’t separate the business from the asking price. At over 30X earnings and $2 trillion in value, Apple needs to create opportunities worth hundreds of billions for shareholders to now justify the asking price. So, we exited a long-time holding, but we know being disciplined and recycling capital into better opportunities is the appropriate decision.”
2. Equinix, Inc. (NASDAQ: EQIX)
Billionaire Chris Rokos’ added Equinix Inc (NASDAQ: EQIX) into his portfolio during the fourth quarter by purchasing 278,057 shares valued at $195 million. Shares of the digital infrastructure company fell 4% so far this year. Equinix’s position represents 4.28% of the overall Rokos’ portfolio at the end of Q4, according to the latest quarterly fillings.
In the Q4 investors’ letter, RiverPark Advisors claimed that Equinix is likely to accelerate its profitability momentum into 2021. Here is what RiverPark Advisors said:
“For Equinix, we continue to believe that the company is strategically well-positioned with 227 data centers in 63 metro areas across 26 countries and should continue to profit from the increased adoption of cloud and hyper-scale data center infrastructure globally.”
1. Amazon.com, Inc. (NASDAQ: AMZN)
Shares of Amazon (NASDAQ: AMZN) have also been struggling since the beginning of this year amid concerns that economic reopening will reduce demand for online products. It is the largest stock holding in the list of billionaire Chris Rokos’ top 10 stock picks.
Mairs & Power, an investment management firm, stated in a Q4 investors’ letter that Amazon’s rising margins and advertising business are among the catalysts. Here is what Mairs & Power stated:
“We did acquire AMZN in the fourth quarter. But not owning it till then cost the Fund in performance relative to the S&P 500 TR Index. We had held off taking a position in Amazon largely due to concerns about the company’s slim margins. But in 2020, we saw its core margins nearly double as more consumers shopped online, which in turn led to greater utilization and route density within Amazon’s delivery network. In addition, Amazon’s advertising business, which represents a small portion of its overall sales, has been growing quickly. Advertising could become the third leg of growth for the company along with e-commerce and Amazon Web Services. In short, Amazon checks all of our boxes — it has a strong management team, great growth prospects, and a strong competitive advantage. And last year, we initiated our position at an intriguing valuation.”
You can also take a peek at Billionaire Lee Ainslie’s Top 10 Stock Picks and Billionaire Nelson Peltz’s Top 8 Stock Picks.
