Trending Stocks: TESARO, American Airlines, Delta, and More

Alphabet Inc (NASDAQ:GOOG) shares have bounced back by 3% as the sector rotation from the formerly hot hand (FANG and tech stocks) into Trump stocks such as banks slows down. Although large cap tech stocks such as Alphabet aren’t exactly cheap, they do represent long-term value given their wide-moats, network effects, and growth potential. Separately, Alphabet is in the spotlight for announcing a new initiative to weed out fake news sites by banning the sites from using AdSense. 126 top funds owned shares of Alphabet Inc (NASDAQ:GOOG) Class C at the end of June, down 16 funds from the previous quarter.

Delta Air Lines, Inc. (NYSE:DAL) and American Airlines Group Inc (NASDAQ:AAL) are the beneficiaries of the ‘Berkshire lift’ today after SEC filings showed that the Oracle of Omaha’s company bought into both stocks (along with two more airlines). Specifically, Warren Buffett‘s Berkshire Hathaway established a new position of around 21.8 million shares in American Airlines Group Inc (NASDAQ:AAL) and 6.33 million shares in Delta Air Lines, Inc. (NYSE:DAL) in the third quarter. Given that Buffett has previously said the following:

“The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, then earns little or no money. Think airlines. Here, a durable competitive advantage has proven elusive since the days of the Wright brothers. Indeed, if a farsighted capitalist had been present at Kitty Hawk, he would have done his successors a huge favor by shooting Orville down”

Berkshire’s investment is quiet surprising, and seemingly a vote of confidence in the U.S. economy seeing as travel is rather sensitive to economic conditions.

Disclosure:None