In this article, we discuss DE Shaw and his top 5 stock picks. If you want to read about some more stocks in the Shaw portfolio, go directly to D.E. Shaw Stock Portfolio: 10 Top Stock Picks.
5. Booking Holdings Inc. (NASDAQ:BKNG)
Number of Hedge Fund Holders: 78
Booking Holdings Inc. (NASDAQ:BKNG) provides travel and restaurant online reservation and related services worldwide. Regulatory filings show that DE Shaw owned 264,045 shares of Booking Holdings Inc. (NASDAQ:BKNG) at the end of September 2023 worth $814 million, representing 0.85% of the portfolio.
On October 23, investment advisory HSBC initiated coverage of Booking Holdings Inc. (NASDAQ:BKNG) stock with a Buy rating and a price target of $3,650. Analyst Meredith Jensen issued the ratings update.
At the end of the second quarter of 2023, 78 hedge funds in the database of Insider Monkey held stakes worth $6.5 billion in Booking Holdings Inc. (NASDAQ:BKNG), compared to 77 in the preceding quarter worth $7 billion.
In its Q3 2023 investor letter, Ensemble Capital Management, an asset management firm, highlighted a few stocks and Booking Holdings Inc. (NASDAQ:BKNG) was one of them. Here is what the fund said:
“Booking Holdings Inc. (NASDAQ:BKNG) (+14.21%): Despite macroeconomic worries and inflation eating into global consumers’ ability to spend, households around the world continue to prioritize travel. While so called “revenge travel,” or increased travel spending after being stuck inside during COVID, has likely run its course, global hotel room nights have only recently returned to pre-COVID trends. As COVID has mostly ceased to have an impact on travel, other than in Asia where China’s extended lockdown means a recovery is still ongoing, growth going forward is likely to be more modest. But during COVID, Booking stayed on offense and has been taking market share. Notably, the company’s alternative accommodations offering has grown substantially and in recent quarters has grown faster than Airbnb.”
4. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 278
Amazon.com, Inc. (NASDAQ:AMZN) is a diversified technology firm with core interests in ecommerce. Securities filings show that DE Shaw owned 7.1 million shares of Amazon.com, Inc. (NASDAQ:AMZN) at the end of September 2023 worth $909 million, representing 0.94% of the portfolio.
Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in Amazon.com, Inc. (NASDAQ:AMZN) with 34 million shares worth more than $4.3 billion.
In its Q3 2023 investor letter, Polen Capital, an asset management firm, highlighted a few stocks and Amazon.com, Inc. (NASDAQ:AMZN) was one of them. Here is what the fund said:
“Amazon continues to showcase it’s place as one of the most competitively advantaged companies in the world. The company has made significant progress in managing costs and better leveraging existing capacity, driving a strong recovery in its profitability. We think there’s additional room for improvement.
AWS growth seems to be stabilizing even while management continues to work with clients to optimize their infrastructure spend. Roughly 90% of global IT spending remains on premise. We believe this will eventually flip, with most IT spending ultimately moving to the cloud over time. We think AWS will be a significant beneficiary of this transition.
Further, our investment case on company profitability driven by AWS and advertising continues to unfold, delivering nearly $8 billion in free cash flow over the trailing twelve months and a net margin of 5%. We expect both to move higher with the mix shift of more profitable businesses growing fastest continuing to take effect.
At Amazon’s current price, we believe the company is well positioned to deliver a mid-teens or higher total shareholder return for our clients over the next five plus years without a Herculean effort from the business. It simply needs to continue executing on current businesses and growing into the capacity it built during and immediately after the pandemic.”
3. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 175
NVIDIA Corporation (NASDAQ:NVDA) provides graphics, computing and networking solutions. Latest data shows that DE Shaw owned 3.3 million shares of NVIDIA Corporation (NASDAQ:NVDA) at the end of the third quarter of 2023 worth $1.4 billion, representing 1.50% of the portfolio.
Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in NVIDIA Corporation (NASDAQ:NVDA) with 20 million shares worth more than $8.8 billion.
In its Q3 2023 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and NVIDIA Corporation (NASDAQ:NVDA) was one of them. Here is what the fund said:
“At the portfolio level, the positive fundamental trends we noticed in the second quarter continued into the third quarter as well – many of our companies are reporting stability or slight improvement in business trends. Weighted average 2023 revenue growth expectations for the portfolio were up 3.8% during the third quarter or up 0.8% if we exclude NVIDIA. We wrote at length about NVIDIA earlier this year, but it is worth mentioning that the company has continued to exceed its own projections and the Street’s most optimistic expectations. After raising its revenue and EPS guidance for 2023 by 40% and 69%, respectively, following its last quarter, NVIDIA increased it further by 26% and 35%, respectively, after reporting the most recent one. Consensus expectations now call for revenues to grow 94% this year, while earnings per share are expected to increase by 192%. You may have seen these kinds of growth rates before, but we doubt you saw them from a company generating $50 billion in revenues. The skeptics who continue to question and doubt the accelerating demand for Generative artificial intelligence forgot to tell NVIDIA about it. But we digress…back to the portfolio…profit expectations have risen even faster than revenues and were up 11% during the third quarter (or up 7.8% ex-NVIDIA) with margin expectations up 149bps (107bps ex-NVIDIA). So, broadly speaking, our companies are seeing improvement in overall business trends, which flow through to their bottom lines, driving higher margins. We are also starting to see the benefits of leaner cost structures and more disciplined capital allocation compared to two or three years ago when capital was both cheaper and more readily available.”
2. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 135
Apple Inc. (NASDAQ:AAPL) is a consumer electronics firm. Latest 13F filings show that DE Shaw owned 9.4 million shares of Apple Inc. (NASDAQ:AAPL) at the end of September 2023 worth $1.6 billion, representing 1.69% of the portfolio of the fund.
On November 16, Tigress Financial analyst Ivan Feinseth maintained a Strong Buy rating on Apple Inc. (NASDAQ:AAPL) stock and raised the price target to $240 from $225.
At the end of the second quarter of 2023, 135 hedge funds in the database of Insider Monkey held stakes worth $194 billion in Apple Inc. (NASDAQ:AAPL), compared to 131 in the previous quarter worth $165 billion.
In its Q3 2023 investor letter, Baron Funds highlighted a few stocks and Apple Inc. (NASDAQ:AAPL) was one of them. Here is what the fund said:
“After a strong start to the year, shares of Apple Inc. partially retraced their gains this quarter. Mixed second calendar quarter financial results, with iPhone, iPad, and Wearables revenue coming in just shy of consensus expectations, coupled with elevated investor concerns about the macro economy and potential weakness in consumer spending later this year, pressured shares. Despite these quarterly fluctuations in product sales, we are encouraged by several long-term trends, including: (1) revenue from higher-margin services like the App Store, iCloud, and Apple Pay, which are growing faster than the overall business, driving better revenue visibility and higher free-cash-flow (FCF) margins; (2) continued gains in global market share in smartphones, wearables, and other hardware categories; and (3) consistent returns of capital to shareholders via share repurchases and dividends. On top of these trends in the core business, Apple is thoughtfully investing in new categories like augmented reality, search, financial services, and streaming media content. We took advantage of weakness in the quarter to add to our position in Apple.”
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 300
Microsoft Corporation (NASDAQ:MSFT) is a Washington-based technology company. Latest 13F filings show that DE Shaw owned over 7.7 million shares of Microsoft Corporation (NASDAQ:MSFT) at the end of September 2023 worth $2.4 billion, representing 2.56% of the portfolio.
Among the hedge funds being tracked by Insider Monkey, Texas-based investment firm Fisher Asset Management is a leading shareholder in Microsoft Corporation (NASDAQ:MSFT) with 24 million shares worth more than $7.8 billion.
In its Q3 2023 investor letter, Jackson Peak Capital, an investment management firm, highlighted a few stocks and Microsoft Corporation (NASDAQ:MSFT) was one of them. Here is what the fund said:
“The Microsoft Corporation (NASDAQ:MSFT)/Activision Blizzard, Inc. (NASDAQ:ATVI) merger arbitrage came to a successful conclusion with the court denying the FTC’s preliminary injunction request. The deal subsequently received approval from the UK CMA and closed in October. The ATVI position was an example of “staying around the hoop” of a significant arb opportunity. At first, the position led to a small loss in Q2 when the UK CMA initially blocked the deal in April, but we stayed close to the case, analyzed the FTC trial and scaled up the ATVI position as it became apparent FTC had a weak case, meaning the probability of the deal going through was mispriced by the market since the companies would likely find a solution to work with the UK CMA (only global regulator who had an issue) if the FTC lost.”
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