Apple (AAPL), Western Digital (WDC): Should You Follow Sprott Asset Management Into Its Favorite Tech Stocks?

#3 CGI Group Inc (NYSE:GIB) 

Shares Owned by Sprott Asset Management (as of September 30): 811,550 shares

Value of Holding (as of September 30): $29.39 million

Moving on, CGI Group Inc (NYSE:GIB) was the only company in Sprott Asset Management’s top five tech stocks in which the fund reduced its stake by more than 10% during the third quarter; it sold 103,820 shares during that period. Shares of the company went up gradually for the first four months of the year, but then suffered a straight-line decline that began in late-April and ended in September. The spike that the stock has seen in November has brought it back into the green for 2015 as it trades with year-to-date gains of nearly 6%. Though it is still not clear why the shares of CGI Group Inc (NYSE:GIB) have had such a swift rally in November, some part of it can be attributed to the stock being upgraded to ‘Buy’ from ‘Hold’ by analysts at Desjardins this month. CGI Group is scheduled to report its fiscal year 2015 fourth quarter results on November 11 and the expectations are that it will declare EPS of $0.80 on revenue of $2.54 billion for the quarter. For the same quarter last year, CGI Group reported EPS of $0.72 on revenue of $2.58 billion. With ownership of 767,902 shares of CGI Group, Joel Greenblatt’s Gotham Asset Management was the second-largest shareholder of the company at the end of second quarter among the funds we cover.

#2 NXP Semiconductors NV (NASDAQ:NXPI) 

Shares Owned by Sprott Asset Management (as of September 30): 345,240 shares

Value of Holding (as of September 30): $30.06 million

NXP Semiconductors NV (NASDAQ:NXPI) jumped up a spot to become Sprott Asset Management’s second-favorite tech stock, with the fund having added an additional 5,240 shares of the company to its portfolio during the third quarter. Also during the quarter, Sprott bought call options underlying 218,000 shares of the company worth $218,000 as of Septemebr 30. After being one of the best performing semiconductor stocks this year, shares of NXP Semiconductors NV (NASDAQ:NXPI) slid by 17% after the company reported its third quarter results on October 28. Even after suffering such a significant decline and not recovering much since, the stock is still trading up by 4% year-to-date. Though the EPS of $1.57 on revenue of $1.52 billion that the company reported for the third quarter wasn’t bad considering that analysts had expected it to report EPS of $1.50 on revenue of $1.55 billion, it was the guidance for the fourth quarter that played spoilsport and caused NXP Semiconductors’ stock to slide heavily the day after it reported those results. For the current quarter the company expects sales to fall by double digits in all of six of its reported divisions and overall revenue to fall by around 15% sequentially. On November 1, analysts at Sterne Agee CRT reiterated their ‘Buy’ rating on the stock, while upping their price target on it to $113 from $107. James Dinan’s York Capital Management buffed its holding of NXP by 7% during the second quarter and held slightly above 4.6 million shares on June 30.

#1 Apple Inc. (NASDAQ:AAPL) 

Shares Owned by Sprott Asset Management (as of September 30): 324,245 shares

Value of Holding (as of September 30): $35.76 million

Finally, it seems Sprott Asset Management is becoming increasingly bullish on the world’s most valuable company. Not only did the fund purchase an additional 9,490 shares of Apple Inc. (NASDAQ:AAPL) during the third quarter, but it also closed its position of Put options on Apple shares, while purchasing call options underlying 2,600 shares. The company again managed to blow away analysts’ expectations when it reported its fiscal year 2015 fourth quarter results on October 27. While the Street had expected it to report EPS of $1.88 on revenue of $51.02 billion, it reported EPS of $1.96 on revenue of $51.50 billion. Revered activist investor Carl Icahn‘s Icahn Capital LP was the largest shareholder of Apple at the end of June among the hedge funds that we cover. An interesting sidenote for investors who track Mr. Icahn’s portfolio is that, assuming that he still owns the more than 52.76 million shares of Apple that he held at the end of June, he will make over $100 million just in dividend payments from Apple this year.

Disclosure: None