Seth Klarman Stock Portfolio: Top 10 Stock Picks

6. Alphabet Inc. (NASDAQ:GOOGL)

Total Number of Shares Owned: 1,069,588

Total Value of Shares Owned: $196,184,000

Number of Hedge Fund Investors: 216

Alphabet Inc. (NASDAQ:GOOGL) remains an attractive investment due to its strong business model, innovative technology, and solid financial performance. In its recent Q2 2024 earnings report, Alphabet Inc. (NASDAQ:GOOGL) showcased significant revenue growth, primarily driven by increased advertising sales and impressive results from Google Cloud. This reflects Alphabet Inc. (NASDAQ:GOOGL)’s ability to adapt and thrive in a changing market, especially as more businesses shift their marketing budgets toward digital platforms.

A key highlight from the earnings report was the boost in YouTube advertising revenue, which benefits from the platform’s large user base and engaging content. This makes YouTube a prime choice for advertisers, contributing greatly to Alphabet Inc. (NASDAQ:GOOGL)’s overall revenue. Additionally, Alphabet Inc. (NASDAQ:GOOGL)’s investments in artificial intelligence (AI) position the company at the forefront of this rapidly growing sector. Recent enhancements to Google Search and Google Cloud’s AI services suggest that Alphabet Inc. (NASDAQ:GOOGL) is ready to capitalize on the rising demand for AI solutions.

Alphabet Inc. (NASDAQ:GOOGL)’s commitment to innovation is evident in its ongoing development of new products and services across various sectors, including autonomous vehicles with Waymo and healthcare technology through Verily. While these ventures may take time to develop, they represent exciting growth opportunities for Alphabet Inc. (NASDAQ:GOOGL) in the future. Coupled with a strong balance sheet and healthy cash flow, Alphabet has the financial flexibility to invest in new initiatives, pursue strategic acquisitions, and return value to shareholders through stock buybacks and dividends.

Despite facing regulatory challenges, Alphabet Inc. (NASDAQ:GOOGL) has shown resilience in navigating these issues, and its diverse business model helps mitigate risks. Overall, with its robust Q2 2024 performance, strategic focus on AI, strong advertising revenue, and ongoing innovation, Alphabet Inc. (NASDAQ:GOOGL) is well-positioned for continued growth in the evolving digital landscape, making it a compelling choice for investors.

Baupost owns 1,069,588 shares worth approximately $196.2 million, as of June 30, 2024.

Diamond Hill Large Cap Strategy stated the following regarding Alphabet Inc. (NASDAQ:GOOG) in its Q2 2024 investor letter:

“Among our top individual contributors in Q2 were Amazon, Texas Instruments and Alphabet Inc. (NASDAQ:GOOG). Media and technology company Alphabet also continued delivering strong results in its search, YouTube advertising, YouTube subscription and cloud businesses. Shares rose amid an environment that continues favoring mega-cap technology companies.”