Ensemble Capital Management, an investment management company, released its third-quarter 2022 investor letter. A copy of the same can be downloaded here. In the third quarter, the strategy outperformed its benchmark, the S&P 500, after three consecutive quarters. The strategy declined 2.6% compared to a 4.9% decline for the S&P 500 Index in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2022.
Ensemble Capital discussed stocks like NVR, Inc. (NYSE:NVR) in the Q3 2022 investor letter. Headquartered in Reston, Virginia, NVR, Inc. (NYSE:NVR) is a US-based homebuilder. On October 17, 2022, NVR, Inc. (NYSE:NVR) stock closed at $4,034.74 per share. One-month return of NVR, Inc. (NYSE:NVR) was -1.22% and its shares lost 19.86% of their value over the last 52 weeks. NVR, Inc. (NYSE:NVR) has a market capitalization of $13.245 billion.
Here is what Ensemble Capital specifically said about NVR, Inc. (NYSE:NVR) in its Q3 2022 investor letter:
“NVR, Inc. (NYSE:NVR): The US housing market has been unstable so far this year, as rising mortgage rates and higher housing prices have rapidly reduced affordability. Fortunately for existing homeowners, most of whom own their houses outright or have locked in low, fixed mortgage rates, rising rates have not directly impacted their finances unless they have an outstanding variable-rate home equity line of credit.
Homebuilders, who rely on incremental demand for housing, have seen demand dry up in response to declining affordability. Single-family home building permits have plummeted in recent months back to pre-pandemic levels.
That’s the bad news. On the bright side, the building materials supply chain, which delayed construction and increased the cost to build a home, is rapidly improving. This bodes well for homebuilders like NVR with a track record of cost discipline. In other words, even if NVR’s average selling price declines, it can maintain attractive gross margins if they simultaneously control costs…” (Click here to read the full text)
NVR, Inc. (NYSE:NVR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held NVR, Inc. (NYSE:NVR) at the end of the second quarter, which was 39 in the previous quarter.
We discussed NVR, Inc. (NYSE:NVR) in another article and shared Diamond Hill Capital’s views on the company. In addition, please check out our hedge fund investor letters Q3 2022 page for more investor letters from hedge funds and other leading investors.
When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.
Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.
At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.
Do the math. According to Musk, this technology could be worth $250 trillion by 2040.
Put another way, that’s roughly equal to:
175 Teslas
107 Amazons
140 Metas
84 Googles
65 Microsofts
And 55 Nvidias
And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.
It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.
Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.
How could anything be worth that much?
The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.
And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.
What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.
In fact, Verge argues this company’s supercheap AI technology should concern rivals.
Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.
Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.
When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.
Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…
But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.
And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…
This prediction might not be bold at all:
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