3. Amazon.com, Inc. (NASDAQ:AMZN)
Highline Capital Management’s Stake Value: $11,851,000
Percentage of Highline Capital Management’s 13F Portfolio: 9.89%
Number of Hedge Fund Holders: 271
Amazon.com, Inc. (NASDAQ:AMZN) is one of the top stocks in Jacob Doft’s Highline Capital Management’s portfolio, with the investment firm owning stakes worth $11.85 million in the US tech giant, which represents 9.89% of Doft’s portfolio as of the end of June. Amazon.com, Inc. (NASDAQ:AMZN) is engaged in ecommerce, cloud computing, digital streaming, and artificial intelligence. Recently, Amazon.com, Inc. (NASDAQ:AMZN) is expanding its cloud computing business segment by entering into long-term contracts with vendors like Teradata Corporation (NYSE:TDC) and Allegiant Travel Company (NASDAQ:ALGT), so they can migrate to the cloud with Amazon Web Services.
At the end of the second quarter of 2021, 271 hedge funds out of the 873 funds tracked by Insider Monkey were bullish on Amazon.com, Inc. (NASDAQ:AMZN), up from 243 in the preceding quarter.
Here is what Madison Funds has to say about Amazon.com, Inc. (NASDAQ:AMZN) in its Q3 2021 investor letter:
“We did add a modest new position weight to the portfolio in the quarter in Amazon.com, Inc. stock (AMZN). We acknowledge that many aspects of Amazon’s merit as an investment are well appreciated. However, our work leads us to conclude that shares are attractive. Leadership positions in both e-commerce and cloud computing provide the company with significant durable competitive advantages in industries that we think can produce above average growth over the next decade. Over the past year, AMZN shares have trailed the market as investors debate near-term growth prospects following the pandemic-induced e-commerce demand. Additionally, margins have been depressed due to Amazon’s unprecedented increases in spending to build out fulfillment and in-house logistics capabilities – Amazon will build out more square footage this year and last than it did cumulatively over the previous 10 years, more than doubling its in-house delivery capacity. We like the investments Amazon is making and believe they will further advantage the company relative to other retailers, making it nearly impossible for competitors to match the same level of delivery speed and convenience. With its large and frequently engaged customer base, Amazon has multiple mechanisms to make money, including selling advertising and enhanced subscription services. Within the cloud business, we forecast Amazon Web Services (AWS) leveraging its strengths in Infrastructure-as-a-service (IaaS) to move into higher value segments of cloud computing (such as platform-as-a-service: PaaS), allowing the company to continue outgrowing the overall IT sector with strong profitability. While Amazon shares have performed extremely well over the long-term, we think near-term concerns about whether Amazon will earn a return on its accelerated investments provide an opportunity now for investors willing to look through the investment period. Our view is that the investments likely earn strong returns and extend Amazon’s competitive advantages and above average growth.”
