In the Realm of Billionaire Favorites: Unveiling the Top Stocks They Embrace

New Heights for Alphabet Inc.

When billionaires make investment decisions, the world takes notice. It’s more than money; it’s a statement. They choose to lead, not follow, armed with knowledge few possess. Keeping an eye on their investments is a crafty move for everyday investors.

Alphabet Inc. (GOOGL), Amazon.com, Inc. (AMZN), and Microsoft Corporation (MSFT) are among Wall Street’s beloved stocks, hitting record highs recently. These tech giants boast rich histories and a penchant for innovation, attracting the attention of financial elite. Here’s a closer look at why these stocks are adored by the affluent and how retail investors can emulate their strategies.

The Rise of Alphabet

Alphabet Inc. (GOOGL) stands as a tech behemoth, tracing its origins back to 1998 in Mountain View, California. Known as Google’s parent company, Alphabet shines with a market cap of $2.3 trillion, driven by iconic products like Google Search, YouTube, and Android. With a focus on artificial intelligence (AI) since 2016, Alphabet leads the way in AI innovations with Google AI and DeepMind, shaping the digital landscape we inhabit today.

Recently, Alphabet hit a new high of $191.75, marking a series of peak performances. Over the past 52 weeks, GOOGL stock surged by 48.7%, eclipsing the S&P 500 Index’s 25% returns during the same period.

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Moreover, Alphabet declared its first quarterly dividend of $0.20 per share. This move, coupled with a forward yield of 0.42% at current levels, hints at Alphabet’s investor-friendly stance.

Trading at 24.39 times forward earnings, GOOGL stock sits below its five-year average of 25.69x. The company’s recent Q1 earnings exceeded expectations, with revenue climbing by 15.4% annually to $80.5 billion and EPS rising by 61.5% year over year to $1.89.

Analysts anticipate the unveiling of Alphabet’s Q2 earnings after the market closes on Tuesday, July 23, with an expected surge of 27.8% in EPS year over year. Looking into the future, fiscal 2024 EPS is projected to rise by 31.2% annually to $7.61, followed by a 13.1% increase to $8.61 in fiscal 2025.

Billionaires Bullish on Alphabet

In the realm of high-stakes investments, billionaire Daniel Sundheim, heralded as the “LeBron James of investing,” increased his stake in Alphabet by over 20% in fiscal Q1. His hedge fund, D1 Capital Partners, upped its holdings to 2.37 million shares, solidifying GOOGL as the fifth-largest position in D1’s portfolio at 5.5%.

Meanwhile, the legendary investor George Soros, known for his unique investment approach rooted in chaos theory and reflexivity, bolstered his Alphabet holdings by acquiring 271,549 shares in Q1. This move raised his total shares to 1.5 million, accentuating Alphabet’s weight in his portfolio at 3.7%.

Pershing Square’s Bill Ackman also placed his bet on GOOGL, owning 9.4 million Class C shares and 4.4 million Class A shares. Alphabet’s dominance in internet search, expansion into high-growth sectors like Google Cloud, robust revenue growth, and strategic dividends make it a darling among top hedge fund managers.

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With an overall “Strong Buy” rating, GOOGL has analysts’ favor, with 34 recommending “Strong Buy,” three suggesting “Moderate Buy,” and seven opting for “Hold.” The average price target for Alphabet is $198.34, indicating a potential 6.3% upside, while the Street-high target of $225 implies a 20.6% potential gain.

The Ascendancy of Amazon

At Washington-based Amazon.com, Inc. (AMZN), boasting a $2 trillion market cap, the story is one of e-commerce and tech dominance. Founded in 1994, Amazon’s reach extends to entertainment with Prime Video, Amazon Music, Prime Gaming, and Twitch, showcasing its multifaceted prowess. Additionally, Amazon Web Services (AWS) holds sway in enterprise cloud software and AI, underpinning Amazon’s clout across various sectors.

Amazon’s stock is on a relentless upswing, climbing by 43% over the past 52 weeks, with a 26.8% rise year to date, outperforming the broader market. Notably, Amazon hit a new all-time high last week at $201.20.

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Priced at 41.35 times forward earnings, Amazon’s stock trades at a discount to its five-year average of 182.49x.

Technology Titans’ Financial Fortunes Technology Titans’ Financial Fortunes: Amazon and Microsoft Hit Stride
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By Ronald Tech


Amazon’s Meteoric Rise

When Amazon’s Q1 earnings results obliterated Wall Street’s estimates, it was more than a surprise – it was a thunderclap on the financial landscape. Total net sales surged by 12.5% annually, soaring to an impressive $143.3 billion. However, the real showstopper was the adjusted EPS of $1.13, stomping forecasts by a jaw-dropping 36.1%. The tech giant’s AWS segment wasn’t far behind, delivering a striking 17.3% increase in sales.

Amazon’s gigantic $50.1 billion free cash flow in Q1 acts as fuel for its AI ventures and acquisitions, while its robust balance sheet, boasting $54 billion in total cash, cash equivalents, and restricted cash, stands like a solid fortress, ready for strategic growth ahead.

The Amazon Investing Frenzy

Renowned billionaire investors like Ken Griffin and Philippe Laffont have joined the Amazon investing frenzy, boosting their holdings with unwavering confidence. With Laffont holding over 10 million Amazon shares and Griffin increasing his stake by 5.66% in Q1, it’s evident that Amazon’s allure is spreading among the financial elite.

Microsoft’s Sturdy Ascent

Headquartered in Redmond, Washington, Microsoft Corporation stands tall with a market cap of a staggering $3.4 trillion. Dominating the realms of PC software and cloud solutions through Azure, Microsoft is a true powerhouse in operating systems and productivity tools.

Having witnessed a 31.5% surge in shares over the past year and a 20.7% rise year-to-date, Microsoft is in its prime. Much like its peers Amazon and Alphabet, Microsoft recently hit a record high, cresting at $468.35 earlier this month.

Microsoft’s Shareholder Rewards

Microsoft’s dedication to rewarding shareholders is unwavering, with approximately $8.4 billion returned through share repurchases and dividends in fiscal Q3. Celebrating 19 years of consecutive dividend growth, the tech giant announced a quarterly dividend of $0.75 per share, enhancing its annualized dividend to $3.00 per share, yielding 0.65%.

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Ongoing Financial Projections

As these tech giants march forward, Amazon anticipates net sales between $144 billion and $149 billion for fiscal Q2, with operating income expected to range between $10 billion and $14 billion. Meanwhile, Microsoft’s upcoming fiscal Q4 earnings results are eagerly awaited, with analysts predicting a 7.8% year-over-year increase in profit per share.