This billionaire is confidently placing his chips on three George Soros stocks, anticipating a jackpot in returns.
While known for his colossal wins in the realm of global currencies, George Soros’ hedge fund has recently shifted focus to stocks. Leading the pack was his significant investment in Splunk, a major player in big data analytics. Holding 1.6 million shares valued at $240 million, it represented over 4.5% of the fund’s total portfolio. Noteworthy is Cisco’s recent acquisition of the company, resulting in a profitable venture for Soros with an acquisition price of $157 per share against his $141 buy price.
Following this lucrative deal, let’s delve into the next trio of top picks in the Soros Fund Management as per the latest 13F filing with the SEC.
The Winning Bet on iShares Russell 2000 ETF (IWM)
Embracing the resurgence of small-cap stocks, Soros’ holding of 1.2 million shares of the iShares Russell 2000 ETF (NYSEARCA:IWM) speaks volumes. This index encapsulates the performance of the 2,000 smallest stocks in the Russell 3000 index.
Decades of market data support the belief in small-cap stocks’ superiority over mid and large-cap counterparts. Studies have shown that small-caps outdid mid and large-caps 60% of the time over 75 years. While small-caps had lagged in recent times, the tide shifted last October, catapulting the Russell 2000 index past the S&P 500.
The index holds companies of various sizes, with some near the border of “small-cap.” Notable giants like Super Micro Computer (NASDAQ:SMCI) and Microstrategy (NASDAQ:MSTR) contribute to the index’s stellar performance, boding well for Soros’ stake in the ETF.
Airborne Success with AerCap Holdings (AER)
Despite its $18 billion market valuation, AerCap Holdings (NYSE:AER) is soaring high, clocking an 18% increase year-to-date and a significant 57% leap over the last 12 months.
The Irish aircraft lessor ended the year on a strong note, with fourth-quarter revenue hitting $1.9 billion, albeit slightly under Wall Street estimates. Earnings, however, surpassed projections at $3.11 per share versus the expected $2.45 per share.
With an ownership of nearly 2.5 million shares at an average acquisition price below $63 per share, Soros Fund Management sees a 40% gain on the stock, which now trades around $88 per share. Analysts foresee a high target of $101 per share, supported by CEO Aengus Kelly’s optimistic outlook for AerCap.
Power Play with Alphabet (GOOG)(GOOGL)
Playing a strong hand, Alphabet (GOOG)(GOOGL) captures Soros’ attention with its robust fundamentals. With a diversified portfolio and recent strategic moves, Alphabet positions itself as a solid investment opportunity.
An In-Depth Look at Soros Fund Management’s Bet on Alphabet Amidst Market Turbulence
Investing Like Soros: A Closer Look at Alphabet
Billionaire investor George Soros has been making significant moves in the stock market, including placing a sizeable bet on Alphabet (NASDAQ: GOOG, GOOGL), with a 3.2% position that amounts to 1.2 million shares valued at $170.3 million. Despite this, the tech giant has not been performing as well as expected, with shares down 13% from Soros’s average buy price of $97.
Market Sentiment and Hedge Fund Activity
While some hedge fund operators like Jim Simons at Renaissance Technologies have been bullish on Alphabet, others such as Paul Tudor Jones from Tudor Investments and the Bill & Melinda Gates Foundation have opted to sell off their stakes. This mixed sentiment reflects the uncertainties surrounding the tech giant’s performance in the current market landscape.
Google’s Dominance and Revenue Streams
Google, a subsidiary of Alphabet, continues to maintain a virtual monopoly in the search engine market with a staggering 91% market share. Despite recent disappointments in advertising revenue, especially earlier this year, the upcoming election cycle is expected to inject significant ad spending into the market. This influx of advertising dollars is likely to benefit Google, capturing a substantial portion of the campaign budgets.
Emerging Competitors and Innovation
Beyond its core search and advertising business, Alphabet’s Google Cloud platform has emerged as a fast-growing contender against rivals such as Amazon’s AWS and Microsoft’s Azure. Over the past few quarters, Google Cloud has outpaced its competitors, showcasing Alphabet’s ability to diversify its revenue streams effectively. Additionally, Alphabet’s involvement in innovative projects like Waymo’s self-driving technology further underscores the company’s potential for long-term growth and innovation.
On the date of publication, Rich Duprey did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
