To say that hedge fund and mutual fund managers tend to follow the herd is an incredible understatement, and always has been. While publicly they sometimes seem reluctant to discuss their holdings, especially stocks they are short sellers of, the reality is managers tend to talk among themselves as they run in the same circles, and often the discussions are centered around their portfolios and what is in them.
In a new Jefferies report, superb equity strategist Steven DeSanctis breaks down the top holdings in not only all three market capitalization groups — large cap, mid-cap and small cap — but he also breaks down the three into core, growth and value categories.
Here are the top five holdings of large-cap growth managers.
The huge social media leader has been volatile recently after the disclosure of user data being compromised. Facebook Inc. (NASDAQ: FB) operates the largest social network, with over 2.0 billion monthly active users and over 1.4 billion daily active users. The company generates revenue from advertising and from payments, with over 95% of revenue from advertising. It generates close to 50% of revenues in the United States and Canada and is expanding rapidly in international markets.
Its solutions also include Instagram, a mobile application that enables people to take photos or videos, customize them with filter effects, and share them with friends and followers in a photo feed or send them directly to friends; Messenger, a messaging application for mobile and web on various platforms and devices, which enable people to reach others instantly, as well as enable businesses to engage with customers; and WhatsApp Messenger, a mobile messaging application.
A stunning 88.7% of managers have the social media giant in their portfolios, and despite the recent issues, there is no reason to think many will be selling all their shares.
The shares were trading early Friday at $167.60, in a 52-week trading range of $142.27 to $195.32. The Wall Street consensus price target for the stock is $217.85.
This absolute leader in online retail and dominant player in cloud storage business remains the top pick at Stifel. Amazon.com Inc. (NASDAQ: AMZN) serves consumers through retail websites that primarily include merchandise and content purchased for resale from vendors and those offered by third-party sellers.
The company serves developers and enterprises through Amazon Web Services (AWS), which provides computing, storage, database, analytics, applications and deployment services that enable virtually various businesses. AWS is also the undisputed leader in the cloud now, and many top analysts see the company expanding and moving up the enterprise information value chain and targeting a larger total addressable market.
Some 82.7% of the managers own shares of this incredible company, which despite some criticism directed at the company by President Trump continues to dominate in many categories.
The posted consensus target price is $1,672.93, and shares traded Friday morning at $1,550.75. The 52-week trading range is $896.29 to $1,617.54