What Hedge Funds Think of Goldman Sachs’ Top Internet Stocks

#3 Amazon.com, Inc. (NASDAQ:AMZN)

 – Investors with Long Positions (as of December 31): 141

 – Aggregate Value of Investors’ Holdings (as of December 31): $17.32 billion

Led by the phenomenal growth in its business and its newfound focus on profitability, Amazon.com, Inc. (NASDAQ:AMZN) saw a huge surge in its popularity among hedge funds during the fourth quarter. The number of funds covered by us with ownership in the company increased by 28 and the aggregate value of their holdings in it increased by $2.34 billion during that time. Shares of the e-commerce giant are down by over 18% this year, but analysts are not concerned and investors are not panicking. Though the company didn’t manage to beat analysts’ expectations when it reported its fourth quarter numbers recently, investors were happy with the phenomenal growth displayed by its most profitable segment, Amazon Web Services. According to data released by Amazon, AWS saw a net sales growth of 69% year-over-year and is currently the highest net income earner for the company. Amazon recently increased the minimum order size for free shipping for non-Prime customers to $50 from $35, which analysts see as a move to increase Amazon’s Prime membership numbers. Andreas Halvorsen‘s Viking Global reduced its stake in the company by 15% to 2.54 million shares during the fourth quarter.

#2 Facebook Inc (NASDAQ:FB)

 – Investors with Long Positions (as of December 31): 146

 – Aggregate Value of Investors’ Holdings (as of December 31): $10.8 billion

Goldman Sachs’ analysts like Facebook Inc (NASDAQ:FB) because of its estimated sales growth over the next few years and a large number of hedge funds covered by us seem to share the same views. During the fourth quarter, a net total of 18 more investors from our database held the stock and the aggregate value of their holdings swelled by $1.84 billion. The social media giant is the only stock among Goldman’s top five Internet stocks which is trading in the green for 2016. That’s primarily due to the better-than-expected numbers that it reported for the fourth quarter on February 4. It declared EPS of $0.79 on revenue of $5.84 billion for the quarter, compared to analysts’ estimates of EPS of $0.68 on revenue of $5.36 billion. On February 24, analysts at Sterne Agee CRT reiterated their ‘Buy’ rating and $135 price target on the stock. Dirk Ziff‘s ZBI services was among the hedge funds that initiated a stake in the company during the fourth quarter; it held 540,957 shares of Facebook as of December 31.

#1 Alphabet Inc (NASDAQ:GOOGL)

 – Investors with Long Positions (as of December 31): 154

 – Aggregate Value of Investors’ Holdings (as of December 31): $15.10 billion

Both the class A and class C shares of Alphabet Inc were lapped up by hedge funds during the fourth quarter. While the ownership of Alphabet Inc (NASDAQ:GOOG)’s class C shares among the investors in our system increased by 23 and the aggregate value of their holdings increased by $2.34 billion during the fourth quarter, ownership of Alphabet Inc (NASDAQ:GOOGL)’s class A shares increased by 25 investors and $3.81 billion in aggregate value of holdings. Shares of the search giant spiked recently in anticipation of its fourth quarter financial results, but have given up all of those gains since then and currently trade down by 7.34% year-to-date. On February 23, the market leader in music streaming, Spotify, announced that it will be migrating its infrastructure to the Google Cloud Platform, which analysts see as a major win and endorsement for the service. D.E. Shaw, founded by billionaire David E. Shaw, reduced its stake in Alphabet’s class C shares by 32% to 665,744 shares during the fourth quarter.

Disclosure: None