Investment management firm, Davis Advisers, released its “Davis New York Venture Fund” 2022 annual investor letter. A copy of the same can be downloaded here. The fund’s portfolio of durable companies trades at 9.8 times forward earnings now compared to 17.8 times for the S&P 500 Index. The firm believes that holdings of the fund have significant earnings prospects in the years ahead. In addition, please check the fund’s top five holdings to know its best picks in 2022.
Davis New York Venture Fund highlighted stocks like Meta Platforms, Inc. (NASDAQ:META) in the 2022 annual investor letter. Headquartered in Menlo Park, California, Meta Platforms, Inc. (NASDAQ:META) is a technology company that develops products to connect people. On March 20, 2023, Meta Platforms, Inc. (NASDAQ:META) stock closed at $197.81 per share. One-month return of Meta Platforms, Inc. (NASDAQ:META) was 14.95%, and its shares lost 8.70% of their value over the last 52 weeks. Meta Platforms, Inc. (NASDAQ:META) has a market capitalization of $512.85 billion.
Davis New York Venture Fund made the following comment about Meta Platforms, Inc. (NASDAQ:META) in its 2022 annual investor letter:
“As both a “blue chip of tomorrow” and a company languishing under “headline risk,” our investment in Meta Platforms, Inc. (NASDAQ:META) reflects these two investment themes. With more than three billion daily users across its three platforms (Facebook, Instagram and WhatsApp), Meta has more users than almost any company in history. Despite this success, Meta currently languishes under a cloud of skepticism concerning two issues: competition from other services, such as TikTok, and significantly increased spending both on artificial intelligence (AI) and speculative new ventures including virtual reality and augmented reality (often referred to as the metaverse).
Starting with competition, despite the drumbeat of negative headlines, which leads most investors to assume that Facebook’s core businesses are shrinking, Figure 9 shows continued growth in the number of users on their core service, including Facebook (green bars), as well as the company’s entire family of applications.
The gold line in Figure 9 shows Meta’s ad revenue per user up more than 30% since 2019 but down from last year’s peak. While we find this decline concerning, it is hardly surprising given the slowing economy and time needed for Facebook to adjust to changes made by Apple—somewhat disingenuously in the name of privacy—that reduced the efficacy of some of Meta’s advertising while favoring Apple. We highlight this decline as a risk but believe it will prove temporary. We think that Meta’s growing user base as well as the continued growth in the amount of time users are spending on these platforms is a far more important indicator of Meta’s relevance and value…” (Click here to view the full text)
Photo by Timothy Hales Bennett on Unsplash
Meta Platforms, Inc. (NASDAQ:META) is in 4th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 194 hedge fund portfolios held Meta Platforms, Inc. (NASDAQ:META) at the end of the fourth quarter which was 177 in the previous quarter.
We discussed Meta Platforms, Inc. (NASDAQ:META) in another article and shared Broyhill Asset Management’s views on the company. In addition, please check out our hedge fund investor letters Q4 2022 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
