Billionaires don’t buy on a whim as most retail investors do, since they have an extreme amount of resources they can spend before they make the decision to go ahead and buy a stock. Stocks like Amazon (NASDAQ:AMZN | AMZN Price Prediction), Nvidia (NASDAQ:NVDA), and Microsoft (NASDAQ:MSFT) have seen interest from multiple billionaires. This begs the question: what’s going on with these particular stocks?
When you have overlapping billionaire names buying a stock like hot cakes, it can signal a windfall. They are required to report big transactions, and you can use this to piggyback off of their purchases. That’s exactly what we will be doing today, and we’ll go a step further by trying to speculate on what exactly is causing these billionaires to buy these three stocks.
Amazon (AMZN)
Amazon saw 111 large buys in Q4 2025, and it’s quite unusual since it’s almost half as big as Nvidia but still managed to rack up a larger list of buys from billionaires and hedge funds. What gives?
The large number of buys is likely stemming from AMZN stock treading water for too long during a growth reacceleration. The stock today trades at just 29 times earnings, which is quite cheap. Historically, Amazon traded at a median of almost 81 times earnings over the past decade. The minimum the market paid was a bit less than 28 times earnings. Billionaires seem to be pouncing on the stock because they sense the bottom is in.
There are also factors beyond just valuation. Amazon is knee-deep in AI, and its AWS business remains the largest cloud computing arm among hyperscalers. It does not get enough credit for that.
Moreover, Amazon is the premier investor and partner of Anthropic, the AI company behind Claude. This is the AI company that is ahead of its competitors when it comes to potential profitability and programming use cases. No other AI model beats Claude at coding. Anthropic is valued at $380 billion, and there are rumors of an IPO later this year. Amazon owns up to 19% of Anthropic.
This is an AI business that expects to be cash-flow positive by 2028, which is extremely fast for any hypergrowth startup. Keep in mind that OpenAI expects to burn $665 billion through 2030.
With that in mind, it makes sense why AMZN stock is popular among billionaires.
Nvidia (NVDA)
NVDA stock saw 104 large buys, and it’s to be expected. This is the biggest company today, far ahead of any other potential competitor. Its AI GPUs are the ones powering the ongoing AI data center buildout and are expected to be in demand through this decade. Its flagship chips are sold out through 2026 due to high demand, and bearish estimates about the demand running out of steam haven’t materialized.
As for why billionaires are investing in it, it’s pretty simple.
NVDA stock is actually remarkably cheap today. This is a business that has grown 101.5% annually on average over the past three years and expects to grow at around 37% annually through this decade. And for this business, you’re paying just 21 times forward earnings.
The PEG ratio is at a laughable 0.37 times, which is a better deal than 95% of the semiconductor industry.
These numbers are not because Nvidia has disappointed investors. Instead, the stock is now cheap due to the market refusing to believe just how good it has performed. Nvidia is now seen as the leader in the AI race and perhaps also the first stock that could tumble if the AI rally stops. The fear is thus dampening the premium.
Nothing in the data says anything about an AI slowdown. If anything, the music is set to continue. The demand is booked, and Nvidia is now sitting on $51 billion of net cash on its balance sheet.
Billionaires are taking advantage of this discount.
Microsoft (MSFT)
Microsoft had 82 large buys. This is quite surprising since the business has been rather disappointing lately. There haven’t been any major breakthroughs or industry dominance. Amazon and AWS are reaccelerating, whereas Microsoft is yet to show anything flashy for the tens of billions it has been spending on AI. In fact, many of its customers are finding the company’s AI features intrusive.
Microsoft was OpenAI’s primary backer and still holds a 27% ownership in the business. But unfortunately for Microsoft, this is not a profitable business. OpenAI is no Anthropic and is more likely than not to go bankrupt if it keeps spending at this rate.
So, where does Microsoft stand with AI today? The company does not have a flagship AI model of its own, and its premier AI product, Copilot, is not used by many people.
Thus, I presume the billionaires who are buying MSFT stock are not doing this for the AI or the growth. The key seems to be valuation, where Microsoft is a good buy.
It trades at just 23 times earnings, whereas it has historically traded at 33 times earnings. Analysts see 59% upside from here in the next 12 months due to the software selloffs recently. It’s a healthy, strong business, and while there’s a drought of good AI news, it is an excellent software bet.
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