We recently published a list of Billionaire Dan Loeb’s Top Stock Picks. In this article, we are going to take a look at where Amazon.com, Inc. (NASDAQ:AMZN) stands against other Billionaire Dan Loeb’s top stock picks.
Dan Loeb is an American billionaire, activist investor, and hedge fund manager best known as the founder and CEO of Third Point, a New York-based hedge fund. Known for his bold activist strategies, sharp letters to corporate boards, and remarkable investment acumen, Loeb has become one of the most influential figures in the hedge fund industry. His ability to identify undervalued companies, implement changes to unlock value, and deliver strong returns for investors has solidified his reputation as a financial powerhouse. He was born in 1961 in California. Coming from an affluent family, his father was a partner at a prominent law firm, and his mother was a historian. Loeb attended the University of California, Berkeley, where he initially studied at the business school before transferring to the College of Letters and Science. He graduated with a degree in economics in 1983.
Read more about these developments by accessing 10 Best AI Data Center Stocks and 10 Buzzing AI Stocks According to Goldman Sachs.
Loeb’s early career in finance saw him working at Warburg Pincus in private equity and later at Citigroup in risk arbitrage. These roles provided him with the foundation to understand markets, value creation, and capital allocation. In 1995, Loeb launched Third Point LLC with $3.3 million in capital, including $300,000 of his own money. The firm initially operated as a scrappy startup but quickly grew in prominence thanks to Loeb’s exceptional returns and his willingness to engage in public activist campaigns. As of the end of the third quarter of 2024, Third Point manages over $7.4 billion in 13F securities. Third Point has delivered double-digit annualized returns since its inception, with Loeb’s keen investment instincts driving its success. Loeb takes large, concentrated positions in companies he believes can be turned around.
Read more about these developments by accessing 30 Most Important AI Stocks According to BlackRock and Beyond the Tech Giants: 35 Non-Tech AI Opportunities.
For this article, we selected stocks by combing through the 13F portfolio of Third Point at the end of the third quarter of 2024. These stocks are also popular among other hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Dan Loeb of Third Point
Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 286
Third Point’s Stake: $689.4 million
Amazon.com, Inc. (NASDAQ:AMZN) engages in the retail sale of consumer products, advertising, and subscriptions service through online and physical stores in North America and internationally. This company’s appeal as an investment opportunity lies in several key aspects. Firstly, as per the report for the third quarter of 2024, free cash flow less principal repayments of finance leases and financing obligations increased to $44.9 billion for the trailing twelve months, compared with $15.9 billion for the trailing twelve months. This reflects the company’s position to reduce debt, reinvest, and return value to shareholders. In addition, reported operating cash flow increased 57% to $112.7 billion for the trailing twelve months, compared with $71.7 billion for the trailing twelve months, highlighting the company’s ability to fund operations and investments. Secondly, Amazon.com (NASDAQ:AMZN) has announced investments in the Delivery Service Partner program of $2.1 billion in North America to support safety programs, training, incentives, and more. The company also plans to invest 25 billion yen in Japan to support last-mile delivery innovation and safety and technology for drivers.
Overall, AMZN ranks 2nd on our list of Billionaire Dan Loeb’s top stock picks. While we acknowledge the potential of AMZN as an investment, our conviction lies in the belief that some stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a stock that is more promising than AMZN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.
