Below is the list of Philippe Laffont’s top 5 stock picks. For a detailed discussion about Laffont’s investment philosophy and portfolio management strategy please see Philippe Laffont’s Top 10 Stock Picks.
5. Meta Platforms, Inc. (NASDAQ:META)
Coatue Management’s stake value: $622 million
Percentage of portfolio: 4.55%
Number of hedge fund holders: 204
Shares of Meta Platforms, Inc. (NASDAQ: META) have been struggling to gain investors’ confidence in 2022 due to concerns over regulatory issues and slowing user growth. The company missed revenue and earnings expectations for the June quarter and market analysts are now anticipating a further drop in its revenue and earnings in the September quarter. Philippe Laffont, however, sees the volatility as a buying opportunity. His firm increased its stake in the company by 19% during the March quarter.
The number of long hedge fund positions has also been declining in Meta Platforms over the past three successive quarters. Of the 912 hedge funds tracked by Insider Monkey, Meta Platforms was in 204 of their 13F portfolios compared to 230 positions in the previous quarter.
4. SQ Block, Inc. (NYSE:SQ)
Coatue Management’s stake value: $800 million
Percentage of portfolio: 5.85%
Number of hedge fund holders: 85
Coatue Management increased its stake in SQ Block, Inc. (NYSE:SQ) by 118% in the March quarter to $800 million worth of shares in the company. SQ shares have fallen by more than 65% so far in 2022 due to the tech market selloff and volatility in the crypto markets.
Market analysts believe that the pressure on the company’s financial and share price performance is primarily due to transitional factors. For instance, Truist analyst Andrew Jeffrey has a ‘Buy’ rating on the stock. The firm said, “We believe the seamless integration of the Square and Cash App ecosystems, catalyzed by BNPL (Buy Now Pay Later), will position Block (SQ) for accelerating C23/C24 and beyond gross profit dollar growth”.
As of the end of the March quarter, Block was in 85 hedge funds’ portfolios compared to 95 positions in the previous quarter.
3. Moderna, Inc. (NASDAQ:MRNA)
Coatue Management’s stake value: $1.19 billion
Percentage of portfolio: 8.72%
Number of hedge fund holders: 41
Shares of Moderna, Inc. (NASDAQ:MRNA) have lost almost half of their value in the past year amid concerns over slowing COVID-19 vaccine sales. Coatue Management saw the dip in its price as a buying opportunity, as the firm lifted its stake in the company by 62% during Q1.
Moderna’s latest results, solid outlook, and $18 billion of cash on its balance sheet make it an interesting pick for value investors. The company generated 9% year-over-year revenue growth in the June quarter and expects to extend that momentum into the second half of 2022. Additionally, the company’s announcement that it will repurchase $3 billion of its common stock suggests that the company also believes its stock is undervalued and poised for better days.
As of the end of March, Moderna was in 41 hedge funds’ portfolios. Heathbridge Capital Management was the leading stakeholder in the company.
2. Rivian Automotive, Inc. (NASDAQ:RIVN)
Coatue Management’s stake value: $1.54 billion
Percentage of portfolio: 11.33%
Number of hedge fund holders: 30
Rivan Automotive, Inc. (NASDAQ:RIVN) was the second-largest stock holding of Coatue Management as of the end of March. The firm held $1.54 billion worth of shares of the manufacturer and seller of electric vehicles and accessories. The company’s share price has plunged by more than 60% in the past 12 months due to a broader market selloff and lofty valuations. However, after the recent price plunge, shares now look attractive for long-term value investors.
Of the 912 hedge funds tracked by Insider Monkey, 30 were bullish about the company as of the end of March. Granite Point Capital was the leading stakeholder in the company.
1. Tesla, Inc. (NASDAQ:TSLA)
Coatue Management’s stake value: $1.64 billion
Percentage of portfolio: 12.04%
Number of hedge fund holders: 80
Tesla, Inc. (NASDAQ:TSLA) is the largest stock holding of Philippe Laffont’s hedge fund, with the firm’s stake worth $1.64 billion as of March 31. The firm is bullish on the fundamentals of the electric vehicle maker and expects it to continue growing. Tesla has generated robust returns for its shareholders over the years, thanks to its aggressive growth plans combined with the world’s move towards alternative clean energy sources.
In its first quarter investor letter, Grantham Mayo Van Otterloo & Co. LLC, an asset management firm, mentioned a few stocks including Tesla. Here is what the firm said:
“To put the demand growth for clean energy materials into perspective, let’s look at Tesla (NASDAQ:TSLA). At its Battery Day last year, Tesla projected three terawatt hours of lithium-ion battery capacity needed in 2030 for the EVs and storage they expect to produce. To reach this target, Tesla alone would gobble up approximately 75% of the world’s current nickel production and four times the world’s current lithium production. These numbers are astounding enough, but when one considers that EVs currently represent just 15% of global nickel demand and about 45% of lithium demand and that Tesla will likely be producing only a small proportion of the world’s EVs in 2030, the implications are staggering. Clean energy materials companies will make a lot more money in the decades to come than they ever have both because they will be selling a lot more metric tons of material and because there are certain to be shortages where supply can’t keep up with the rapidly growing demand.”
You can also take a look at the Billionaire Dan Loeb is Adding These 9 Stocks in his Portfolio and Jim Cramer Is Talking About These 10 Stocks.
