Wall Street sometimes gives investors lemons. Each of the U.S. major stock indexes fell into a bear market in 2022. The bond market is currently on track for its worst year. Wall Street can be a lemon for investors, but billionaire money managers make lemonade out of it. According to the most recent round of 13F filings with Securities and Exchange Commission, billionaire money managements clearly want to own these five stocks by 2023.
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Billionaires Ken Fisher, Philippe Laffont, and Jeff Yass, of Susquehanna, oversaw the purchase of 3.33 million shares and 4.52 million shares respectively of Nvidia stock during the third quarter. Nvidia's role as a major player in GPUs is the most likely reason billionaires are optimistic. Nvidia controls nearly a fifth the global GPU market and 80% discrete graphics cards. Nvidia faces many headwinds, however. In September, U.S. regulators prohibited Nvidia from exporting its A100 GPUs with AI to China. This forced Nvidia to create a slower GPU in order to comply with the requirements for export to China. Mid-November 13F filings show that billionaires Stephen Mandel, Laffont, Coatue Management, Ole Andreas Halvorsen, Steven Cohen, and Steven Cohen purchased approximately 4.01 million shares and 3.47 million shares respectively. They also bought 1.71 million shares and 1.25 millions shares of PayPal stock. While PayPal was crushed in 2022 due to historically high inflation and a weaker cryptocurrency market, it is important to note that its engagement with digital-payment platforms is growing. The average active PayPal account has completed 50.1 transactions in the TTM period since the end of 2020. This is compared to 40.1 transactions in the trailing 12-month (TTM), period. Billionaire investors are also pleased with Dan Schulman's efforts in making the company more efficient. PayPal expects to cut its annual spending by $900million this year. The company also has a goal of achieving a minimum $1.3 billion cost savings in 2023. PayPal will not reduce its spending while it is reducing its interim spending. However, it will continue to invest in new digital-payment innovation.
Source: Walt Disney
According to the latest 13F filings, billionaires Fisher of Fisher Asset Management and Yasso Susquehanna International bought around 4.65 million shares, 3.25million shares and 400,000 shares respectively of Disney stock. Even though Walt Disney has been through a difficult year, marred by the ongoing COVID-19 pandemic at its movie theaters and in its parks, investors still appreciate its clear competitive advantages. Another reason Walt Disney is able to outpace inflation is the sentiment it evokes in multiple generations of movie-watchers and park-goers. The cost of admission to Disneyland in Southern California has increased from $1 to $104 since 1955. Despite the fact that advertising spending is likely to be lower in the first half 2023 because of growing concerns about a U.S recession, billionaires have invested heavily in Pinterest due to its obvious advantages. For instance, Pinterest's average revenue per user continues to rise by a double-digit percent despite the fact that the company's monthly active users (MAUs) have fallen a little (mostly due the rollout COVID-19 vaccines. Another important point about Pinterest is its inability to be affected by data-tracking modifications made by app developers. Most social media sites use data-tracking tools for advertisers to target users. However, Pinterest encourages MAUs to share things, places and services that interest them. There are many billionaires who bought shares of Amazon stock in the third quarter. However, there are three major purchases that stand out. Amazon shares fell by half in 2022 due to concerns about short-term retail sales weakness and the company's high valuation relative to its earnings. These billionaires are right to recognize that Amazon's ancillary businesses continue to be a success. They generate the bulk of Amazon's operating cash flow. According to a Canalys report, Amazon Web Services (AWS), accounted for 32% of global cloud infrastructure services spending during the third quarter. AWS, subscriptions services and even advertising services are higher-margin segments with the potential to triple Amazon's operating cashflow by 2025.