Big Moves in the Stock Market: Stanley Druckenmiller Sells Palantir, Buys Philip Morris

Less than three weeks ago, investors received what can arguably be described as the most important data dump of the third quarter. On November 14, institutional investors had to file Form 13F with the Securities and Exchange Commission, sharing crucial information about their stock transactions.

A Form 13F is mandatory for institutional investors with at least $100 million in assets under management (AUM). It reveals the stocks that top investors on Wall Street are buying and selling during the most recent quarter. While these reports are filed up to 45 days after a quarter ends, they offer valuable insight into stock trends and popular investments among leading asset managers.

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While Berkshire Hathaway often steals the spotlight with its filings—and everyone is eager to see Warren Buffett’s moves—another billionaire investor making headlines is Stanley Druckenmiller. He manages nearly $3 billion in AUM at Duquesne Family Office, with his portfolio comprised of 75 positions, which may include options and shorts not disclosed in a 13F filing.

In a noteworthy decision in 2024, Druckenmiller sold most of his stake in the popular artificial intelligence (AI) stock Palantir Technologies (NASDAQ: PLTR) and shifted his focus to a high-yield dividend stock.

Palantir Gets the Ax as Duquesne Reassesses

Duquesne Family Office is known for its active trading, maintaining an average holding period of just seven months for its 75 positions. In the last quarter alone, Druckenmiller exited 22 positions and reduced another 20. Among the declines was a significant cutback in Palantir.

At the midpoint of 2024, Duquesne held close to 770,000 shares of Palantir. By September 30, however, the fund had sold off 728,255 shares, marking a staggering 95% reduction in its holdings.

Profit-taking is a likely justification for this move. Palantir’s shares surged by 291% year-to-date, and Duquesne had initiated its position earlier in the year. The rise was largely due to the growing demand for Palantir’s AI and machine learning platforms, notably the government-focused Gotham platform and the commercial data analytics tool Foundry.

While Gotham provides steady revenue through government contracts, its growth potential is limited by access restrictions. Conversely, Foundry’s customer base increased by 51% to 498 in the last year, but it has yet to prove it can generate profits like Gotham.

Another factor influencing Druckenmiller’s decision appears to be Palantir’s valuation. The company’s shares are currently priced at over 43 times projected sales for the coming year and 143 times estimated earnings per share (EPS) in 2025, suggesting the possibility of a tech stock bubble.

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Druckenmiller Finds Value in Philip Morris

Despite parting ways with Palantir, Duquesne Family Office also made significant investments this year. Notably, Druckenmiller focused on acquiring shares of a less popular stock—Philip Morris International (NYSE: PM)—that currently offers a robust dividend yield.

Since March, Duquesne has secured 1,134,635 shares of Philip Morris and purchased call options, hinting at potential strategies not fully reflected in the 13F filing. Tobacco companies have faced numerous challenges, including tighter advertising regulations and decreasing smoking rates—falling from around 42% in the mid-1960s to 11.5% in 2021.

Nevertheless, Philip Morris stock has reached new heights this year. One advantage is its ability to raise prices on its products, thanks to strong demand driven by nicotine addiction. Notably, the company sells the well-known Marlboro brand in many countries outside the U.S.

Additionally, Philip Morris benefits from revenue diversity, operating in over 180 countries, which allows it to adapt when facing challenges in developed markets. The company has also been expanding its smokeless tobacco products, contributing to a 16.8% organic revenue growth in this segment during the last quarter. Smoke-free products accounted for 38% of total net sales.

While Philip Morris is no longer the bargain it once was, its yield exceeds 4%, and its earnings growth has resumed thanks to its smokeless product line.

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Sean Williams has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway and Palantir Technologies. The Motley Fool recommends Philip Morris International. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.