Wedgewood Partners, an investment management company, released its “Large Cap Focused Growth Fund” third-quarter 2022 investor letter. A copy of the same can be downloaded here. In the third quarter, the fund returned -4.1% net, compared to a -4.9% return for the Standard & Poor’s Index. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.
Wedgewood Partners discussed stocks like Alphabet Inc. (NASDAQ:GOOG) in the Q3 2022 investor letter. Alphabet Inc. (NASDAQ:GOOG) is a multinational technology company headquartered in Mountain View, California. On October 13, 2022, Alphabet Inc. (NASDAQ:GOOG) stock closed at $99.71 per share. One-month return of Alphabet Inc. (NASDAQ:GOOG) was -3.78% and its shares lost 29.62% of their value over the last 52 weeks. Alphabet Inc. (NASDAQ:GOOG) has a market capitalization of $1.295 trillion.
Here is what Wedgewood Partners specifically said about Alphabet Inc. (NASDAQ:GOOG) in its Q3 2022 investor letter:
“Alphabet Inc. (NASDAQ:GOOG) grew its core search revenues +18% (foreign exchange adjusted) on a staggering +68% year ago comparison. Despite this stellar top-line performance, shares continued to sell off as the market discounted fears of a recession. Our multi-year time horizon allows us to tolerate this exact kind of short-term volatility in growth rates (rather than implicitly extrapolating near-term slowing growth trends into perpetuity by selling). The past few years of economic activity and dramatic shift in company-specific drivers of growth have been unprecedented, so a “normalization” of end-market demand at Alphabet is not the end of the world in terms of surprises. In addition, core Google Search has been less affected by disruptions related to Apple’s privacy initiatives thanks to the Company’s long-term investment in the Android Mobile operating system. Alphabet’s Cloud segment is generating revenue at a $25 billion run rate, but is still running at a loss. This business is capable of generating much better margins at some point. In the meantime, the Company has a fortress balance sheet and has been repurchasing shares at attractive historical multiples.
Alphabet’s business segmentation has been gradually broken out over the past few years and often it seems most of the discussion about the Company’s segment performance revolves around YouTube, Google Cloud Services, and even the Company’s Other Bets. But the standout performer of the Company’s segments over the past few years has been “Google Search & other.” The ignominious descriptor of “other” is used in more than a couple of Alphabet’s named segments, but in the case of Search, “other” contains the revenues from no less than: Google Maps, Gmail, and Google Play. These “other” businesses along with Search have generated an incremental $50 billion in revenue since the pandemic emerged…” (Click here to read the full text)
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Alphabet Inc. (NASDAQ:GOOG) is in 6th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 153 hedge fund portfolios held Alphabet Inc. (NASDAQ:GOOG) at the end of the second quarter which was 160 in the previous quarter.
We discussed Alphabet Inc. (NASDAQ:GOOG) in another article and shared the list of the most valuable companies in history. In addition, please check out our hedge fund investor letters Q3 2022 page for more investor letters from hedge funds and other leading investors.
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I work for one of the largest independent financial publishers in the world – representing over 1 million people in 148 countries.
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Should I put my money in Artificial Intelligence?
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