In this article, we discuss 5 tech stocks Warren Buffett is holding despite selloff. If you want to see more tech stocks held by the billionaire amid the broader market selloff, click Warren Buffett Is Holding These 10 Tech Stocks Despite Selloff.
5. Liberty Latin America Ltd. (NASDAQ:LILA)
Number of Hedge Fund Holders: 16
1-Month Decline in Share Price as of May 17: 12.28%
Liberty Latin America Ltd. (NASDAQ:LILA) offers fixed, mobile, and subsea telecommunications services, operating through C&W Caribbean and Networks, C&W Panama, Liberty Puerto Rico, VTR, and Costa Rica segments. Liberty Latin America Ltd. (NASDAQ:LILA) shares have declined 12.28% in the last month. On May 4, the company posted Q1 cash and cash equivalents of $923.4 million. The $1.21 billion revenue was up 4.3% year-over-year, but missed analysts’ estimates by $40 million.
Securities filings for Q1 2022 reveal that Warren Buffett’s Berkshire Hathaway owned 2.63 million shares of Liberty Latin America Ltd. (NASDAQ:LILA), worth $25.5 million. The billionaire did not change his stake in the company despite the broader tech selloff.
According to Insider Monkey’s Q4 data, 16 hedge funds were long Liberty Latin America Ltd. (NASDAQ:LILA), up from 14 funds in the preceding quarter. William Crowley, William Harker, and Stephen Blass’ Ashe Capital is a significant position holder in the company, with 12.3 million shares worth $118.8 million.
Here is what Steel City Capital has to say about Liberty Latin America Ltd. (NASDAQ:LILA) in its Q1 2022 investor letter:
“Liberty Latin America (Nasdaq: LILA): LILA is the Rodney Dangerfield of the John Malone empire – it don’t get no respect. The company is a leading telecommunications provider (broadband, television, wireless) operating in over 20 countries across Latin America and the Caribbean. Shares have had a tough go since spinning out from Liberty Global in 2018. At separation, the valuation was rich, but a lot of so-called value investors rushed in anyways because they thought any investment opportunity that checked the boxes of “spin-off” and “John Malone” had to be a money-maker. Wrong. Add to this some pretty ugly financial performance brought about by Hurricane Maria in Puerto Rico and a cumbersome (but not all the complicated) capital structure, and it’s easy to see why shares have performed so poorly. But as you’ve no doubt read in prior quarters’ letters, I’m a big believer in the notion that past performance is not indicative of future results. Today’s market cap is ~$2.1 billion (and shrinking via an ongoing buyback program) and I can very easily underwrite free cash flow north of $400 million in 2024. This reflects a P/FCF multiple of 5.25x / a free cash flow yield of nearly 20%. This is exceptionally cheap for a company with recurring cash flow streams and a very long opportunity to grow via penetration in the years to come.”
4. Visa Inc. (NYSE:V)
Number of Hedge Fund Holders: 142
1-Month Decline in Share Price as of May 17: 4.30%
Visa Inc. (NYSE:V) is a payments technology company. Warren Buffett’s Berkshire Hathaway first invested in Visa Inc. (NYSE:V) back in Q3 2011, and the hedge fund has consistently held its position in the company. In the first fiscal quarter of 2022, Buffett owned 8.2 million shares of Visa Inc. (NYSE:V), worth $1.84 billion. The share price dropped by 4.30% in the past month.
On April 26, Visa Inc. (NYSE:V) reported its Q1 2022 results, posting earnings per share of $1.79, beating market consensus estimates by $0.14. The revenue climbed 25.48% year-over-year to $7.19 billion, outperforming analysts’ predictions by $366.88 million.
Goldman Sachs analyst Will Nance on May 17 initiated coverage of Visa Inc. (NYSE:V) with a Buy rating and a $282 price target, implying 43% upside. The analyst also added the stock to the firm’s Americas Conviction List. He sees Visa Inc. (NYSE:V) as the global leader in fintech with “attractive leverage to the long-term secular growth driver from payment electronification”.
According to Insider Monkey’s Q4 data, 142 hedge funds were bullish on Visa Inc. (NYSE:V), compared to 143 funds in the last quarter. In Q1 2022, Chris Hohn’s TCI Fund Management was a notable shareholder of the company, with almost 20 million shares worth $4.4 million.
Here is what Wedgewood Partners has to say about Visa Inc. (NYSE:V) in its Q1 2022 investor letter:
“Visa continued to benefit from strong consumer spending as well as a recovery in crossborder payment volumes, more recently driven by the return of travelers. While the emergence of the “Omicron” variant of COVID early in the quarter posed a risk to this travel recovery, it proved short-lived, with most of Europe, North America, and Latin American re-engaging in cross-border travel. Visa continues to extend its network to all comers. By processing over $10 trillion in volume per year, Visa has unparalleled scale and, as a result, can sell this scale to its customers at very attractive economics. For example, “FinTech” businesses will often charge customers upwards of 3-5% to transact, while Visa takes mere basis points on most transactions, despite enabling service levels historically reserved for only the largest financial institutions. After adding to Visa late last year, we are most pleased that Visa is back to one of our top 5 holdings.”
3. Nu Holdings Ltd. (NYSE:NU)
Number of Hedge Fund Holders: 28
1-Month Decline in Share Price as of May 17: 40.78%
Nu Holdings Ltd. (NYSE:NU) is a Brazilian financial technology company that operates a digital financial services platform, operating mainly in Brazil, Mexico, and Colombia. Berkshire Hathaway added Nu Holdings Ltd. (NYSE:NU) to its Q3 2021 portfolio, buying over 107 million shares. Despite the share price falling 40.78% in the last month, Warren Buffett’s stake in the company remained consistent.
On May 16, Nu Holdings Ltd. (NYSE:NU) reported financial results in Q1 2022, posting GAAP earnings per share of $0.01, beating market estimates by $0.02. The $877.27 million revenue outperformed consensus by $223.83 million.
Susquehanna analyst James Friedman on May 13 lowered the price target on Nu Holdings Ltd. (NYSE:NU) to $10 from $14 and kept a Positive rating on the shares. The analyst noted that despite margin headwinds, compared to credit books from peers, the company seems best suited to survive a deterioration in credit quality.
According to the Q4 database of Insider Monkey, 28 hedge funds were bullish on Nu Holdings Ltd. (NYSE:NU), with collective stakes worth $4.6 billion.
2. StoneCo Ltd. (NASDAQ:STNE)
Number of Hedge Fund Holders: 35
1-Month Decline in Share Price as of May 17: 13.84%
StoneCo Ltd. (NASDAQ:STNE) offers financial technology solutions to merchants who conduct business via e-commerce, in-store, online, and mobile channels in Brazil. Berkshire Hathaway held on to his StoneCo Ltd. (NASDAQ:STNE) stake in Q1 2022, which consisted of 10.6 million shares worth over $125 million, despite selloff.
On April 8, Cantor Fitzgerald analyst Josh Siegler initiated coverage of StoneCo Ltd. (NASDAQ:STNE) with an Overweight rating and a $15 price target. The analyst believes that while Brazilian inflation will remain high in 2022, he thinks the stock has overcorrected, and thinks the market may be overlooking StoneCo Ltd. (NASDAQ:STNE)’s capacity to control the financial expense impact through higher prepayment charges.
According to Insider Monkey’s Q4 data, 35 hedge funds placed long calls on StoneCo Ltd. (NASDAQ:STNE), compared to 37 funds in the last quarter. In Q1 2022, D E Shaw was one of the leading shareholders of the company, with 5.4 million shares worth $64.2 million.
Here is what ClearBridge Investments Global Growth Strategy has to say about StoneCo Ltd. (NASDAQ:STNE) in its Q4 2021 investor letter:
“We also sold and trimmed several names in the emerging market and emerging growth areas, to manage risk and pursue growth companies with a better long-term risk/reward. These included Brazilian payments provider StoneCo. Having expected a rebound in their performance post a profit warning earlier in the year, rising interest rates in Brazil and investments in newly acquired companies increased operating costs and depressed earnings.”
1. VeriSign, Inc. (NASDAQ:VRSN)
Number of Hedge Fund Holders: 34
1-Month Decline in Share Price as of May 17: 21%
VeriSign, Inc. (NASDAQ:VRSN) is a Virginia-based company that offers domain name registry services and internet infrastructure for multiple prominent domain names worldwide. Warren Buffett’s hedge fund kept its stake in VeriSign, Inc. (NASDAQ:VRSN) unchanged in Q1 2022, holding 12.8 million shares worth $2.85 billion.
On April 28, VeriSign, Inc. (NASDAQ:VRSN) reported earnings for Q1, posting an EPS of $1.56, beating market consensus by $0.05. The revenue of $346.90 million also surpassed Street estimates by about $4 million.
Baird analyst Rob Oliver downgraded VeriSign, Inc. (NASDAQ:VRSN) on April 29 to Neutral from Outperform with a price target of $210, down from $260. The company slashed fiscal 2022 estimates, citing a reduced domain outlook amid a softening post-COVID demand and incremental weakness in the macro backdrop, the analyst told investors in a research note. He believes the “sudden domain uncertainty could weigh on shares”.
In Q4 2021, 34 hedge funds were bullish on VeriSign, Inc. (NASDAQ:VRSN), down from 40 funds in the earlier quarter. Jim Simons’ Renaissance Technologies held a significant stake in the company in Q1 2022, with more than 4 million shares worth $893.5 million.
Here is what Baron Asset Fund has to say about VeriSign, Inc. (NASDAQ:VRSN) in its Q4 2021 investor letter:
“Verisign, Inc. provides internet infrastructure services worldwide and is best known for its exclusive role managing the .com and .net domains, for which it receives annual fees from all those domain owners. Shares of Verisign gained after reporting strong revenue growth and operating margins that exceeded Wall Street forecasts. We continue to be positive on Verisign’s business, based on its strong competitive position, capacity for global growth in domain names, and its ongoing ability to generate substantial free cash flow.”
You can also take a look at 10 Consumer Technology Stocks to Invest In According to Ken Fisher’s Fisher Asset Management and Top 10 Stocks Billionaire Mets Owner Steve Cohen Just Added to His Portfolio.
