Five Technology Stocks Hedge Funds Are Crazy About

The Technology sector is one of the biggest and fastest developing sectors with one of the highest returns amongst all. This is why tech stocks are very popular among investors, although there are few that stand above the others. Since we track hundreds of 13F filings, this allows us to go through them and find the tech stocks that are the most popular among hedge funds and other institutional investors. The first several companies on the list, such as Google Inc (NASDAQ:GOOG), Apple Inc. (NASDAQ:AAPL), or Microsoft Corporation (NASDAQ:MSFT) are obvious choices. However, read on to see which other companies made the list at the end of last year.

Google Inc (NASDAQ:GOOG)

Google Inc (NASDAQ:GOOG) has been the most popular choice among hedge funds with 170 of them reporting the company in their equity portfolios. More than a quarter of hedge funds have been betting on Google over the past 6 months. Hedge funds were rewarded handsomely as Google Inc (NASDAQ:GOOG) showed significant growth and made several recent acquisitions. For 2013, the company posted a 20% increase in revenue and a 10+% gain in net income. Paul Ruddock and Steve Heinz‘s Lansdowne Partners reported holding around 974,440 shares of Google, worth $1.1 billion.

The next on the list is Apple Inc. (NASDAQ:AAPL) with 160 hedge funds being bullish on the company. The total value of their positions amounts to a whopping $18.5 billion. Apple seems to be a cheap company with a huge pile of cash but we aren’t convinced that the company can maintain its current profitability over the next several years. Activist Carl Icahn owns a significant stake in the company and even tried to pursue the company into a major buyback program. David Einhorn has also been a long-term Apple shareholder.

Microsoft Corporation (NASDAQ:MSFT) is the third most popular technology stock among hedge funds despite its recent struggles to beat its competitors. Still, 120 hedge funds own shares of Microsoft at the end of last year. Since the beginning of this month, Microsoft has a new CEO, SatyaNadella, formerly the Executive Vice President of Microsoft’s Cloud and Enterprise group. So, with the new management, and growing popularity of Microsoft’s new Xbox One console, among other things, Microsoft might be up to big things in the nearest future. Jeffrey Ubben and Stephen Mandel are among Microsoft investors.

In Facebook Inc (NASDAQ:FB), 100 hedge funds reported long positions. With the Facebook’s recent $19 billion acquisition of WhatsApp Messenger, Facebook will only increase the number of its users, and strengthen its mobile presence. So far, the news about the acquisition have been positively received, with the stock of the company edging up by around 5%. In the meantime, Andreas Halvorsen‘s Viking Global is the hedge fund with the largest stake, worth over $1.0 billion.

QUALCOMM, Inc. (NASDAQ:QCOM) has also made the list, after 99 hedge funds revealed bullish positions in the company in their 13F filings. Qualcomm’s P/E trails at 21 and forward P/E is at about 13. At the end of 2013, Lone Pine Capital, led by Stephen Mandel, held 10.9 million shares of QCOM, worth over $808 million.

Disclosure: none

Recommended Reading:

Electron Capital Partners’ Latest 13F Shows Strong Focus on Utilities

Stuart Weisbrod’s Iguana Healthcare Management Is Fond of These Stocks

Hedge Fund News: George Soros, Thomas Steyer & Nouriel Roubini

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