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There is no point in originality when it comes to investing. You can do all your homework and buy the stocks you think are most likely to yield huge profits, or you can make it easy on yourself by following the lead of wealthy investors.
These days, it’s relatively easy to track the stock movements of billionaire investors and hedge fund managers if you want to take cues from them. If so, keep reading to see two stocks that a top investor is adding to his portfolio that he thinks are worth buying.
Image source: Getty Images.
1. Metaplatform
meta platform (meta -1.22%) It was one of this year’s biggest success stories. Facebook’s parent company nearly tripled its growth thanks to its Year of Efficiency initiatives. Although the company experienced four rounds of layoffs, its core business performance improved significantly as Reels products became more profitable and advertising demand recovered from a slump in 2022.
The company also capitalized on the emerging AI boom by launching new products such as the LLaMa large-scale language model and an AI assistant with celebrity voices and likenesses.
Billionaire investors have been keeping an eye on the company’s turnaround, as the company has followed many of the cost-cutting proposals made by its largest shareholders. Among the buyers of Meta stock in the third quarter was David Tepper’s Appaloosa Management, which purchased 447,500 shares, making it the top holder of Appaloosa stock.
Mr. Tepper is known for his contrarian investment approach. For example, he bought bad bank bonds, betting that the government would help during the Great Financial Crisis.
Recently, Appaloosa has been long buying big tech stocks. microsoft, Amazon, Nvidiaand alphabet Rounding out the top five.
Looking ahead to 2024, the meta seems poised for further gains. Corporate spending is expected to rise, especially as the Federal Reserve is expected to lower interest rates, and the company’s profitability should continue to rise and the digital advertising market should recover.
2. Nvidia
One of the few stocks that outperformed Metaplatform this year was Nvidia (NVDA)a semiconductor company that has established itself as the clear leader in AI chips.
The company invented graphics processing units (GPUs) and specially designed components such as the H100 accelerator, which are now in such high demand that they are in short supply.
The same goes for other chip manufacturers. Advanced Micro Devices and intel Although it has announced its own accelerators for training AI models and similar purposes, Nvidia still has a significant head start in this area. And the company’s recent results show that growing interest in its products is clearly leading to profits.
Third-quarter sales increased 206% to $18.12 billion, and generally accepted accounting principles (GAAP) net income increased more than 1,200% to $9.24 billion, giving the company a profit margin of more than 50%. have become.
Among the big-name investors who have been snapping up Nvidia stock recently is Ken of Citadel, the best-performing hedge fund in 2022, returning $16 billion despite a collapse in stock and bond prices. There’s also Mr. Griffin. By several measures, Citadel is the best-performing hedge fund in history.
Citadel bought 738,327 shares of Nvidia stock during the 3rd quarter, bringing its total holdings to 2,053,872 million shares and 0.19% of its vast portfolio.
Considering explosive growth in 2023, surging demand for AI chips, demand outpacing supply, and relatively little competition from other chipmakers, NVIDIA could easily continue rising through 2024. . The AI boom is likely to accelerate in 2024, and the company appears well-positioned to be a winner next year.
Randi Zuckerberg is a former Facebook head of market development and spokesperson, sister of Meta Platforms CEO Mark Zuckerberg, and a member of the Motley Fool’s board of directors. John Mackey, former CEO of Amazon subsidiary Whole Foods Market, is a member of the Motley Fool’s board of directors. Alphabet executive Suzanne Frye is a member of The Motley Fool’s board of directors. Jeremy Bowman holds positions at Amazon and Meta Platforms. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, Meta Platforms, Microsoft, and Nvidia. The Motley Fool recommends Intel and recommends the following options: Long January 2023 $57.50 calls on Intel, long January 2025 $45 calls on Intel, and short February 2024 $47 calls on Intel. The Motley Fool has a disclosure policy.
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