In this article we discuss the 5 best tech and dividend stocks to buy according to billionaire Chase Coleman. If you want to read our detailed analysis of Coleman’s history and hedge fund performance, go directly to the 10 Best Tech and Dividend Stocks to Buy According to Billionaire Chase Coleman.
5. Apollo Global Management, Inc. (NYSE: APO)
Coleman’s Stake Value: $1,641,284,000
Percentage of Chase Coleman’s 13F Portfolio: 3.77%
Dividend Yield: 3.66%
Number of Hedge Fund Holders: 44
Apollo Global Management, Inc. (NYSE: APO) has returned more than 9% to investors over the past year. It was founded in 1990 and stands fifth on our list of 10 best tech and dividend stocks to buy according to billionaire Chase Coleman.
On May 4, the company announced a quarterly dividend of $0.50 per share, in line with the previous. On April 14, the stock was upgraded to ‘Outperform’ from ‘Perform’ by Oppenheimer, with a price target of $59.00.
Tiger Global Management LLC holds more than 34 million shares in the company, worth over $1.64 billion, representing 3.77% of their portfolio. At the end of the first quarter of 2021, 44 hedge funds in the database of Insider Monkey held stakes worth $2.36 billion in Apollo Global Management, Inc. (NYSE: APO), up from 30 the preceding quarter worth $2.05 billion.
In its Q3 2020 investor letter, RiverPark Advisors, LLC, an asset management firm, highlighted a few stocks and Apollo Global Management, Inc. (NYSE: APO) was one of them. Here is what the fund said:
“Blackstone & Apollo: Our alternative asset managers BX and APO were top detractors for the quarter as their results were affected by the COVID shutdowns, which have delayed the selling of assets and the realization of performance fees. Both companies (as well as our third alternative asset manager KKR) continue to generate consistently strong fee-related earnings (BX’s and APO’s fee-related earnings increased 28% and 9%, respectively, in the second quarter) and grow their assets under management (AUM) at impressive rates (BX’s and APO’s fee-generating AUM increased 12% and 45%, respectively, year over year).
While both face a temporary slowdown in investment realizations and near-term mark-to-market headwinds from the current crisis, most of their capital is long-dated or even permanent, most of their fees, which are high-margin and recurring, are not sensitive to the market, and both have billions of dollars of capital available to invest ($156 billion and $47 billion at the end of 2Q for Blackstone and Apollo, respectively). We continue to view BX and APO as two of the better risk-reward holdings in our portfolio, offering substantially better-than-average growth and cash flow fundamentals, and world class management teams, as well as dividend yields of 2.8% and 4.2%, respectively.”
4. PayPal Holdings, Inc. (NASDAQ: PYPL)
Coleman’s Stake Value: $217,585,000
Percentage of Chase Coleman’s 13F Portfolio: 0.50%
Number of Hedge Fund Holders: 143
PayPal Holdings, Inc. (NASDAQ: PYPL) has returned more than 66% to investors during the course of the past twelve months. The company was founded in 1998 and is ranked fourth on our list of 10 best tech and dividend stocks to buy according to billionaire Chase Coleman. Just like Alibaba Group Holding Limited (NYSE: BABA), JD.com, Inc. (NASDAQ: JD) and Amazon.com, Inc. (NASDAQ: AMZN), PayPal is one of the best stocks to buy according to billionaire Chase Coleman.
On May 13, PayPal partnered with Google Cloud to scale and guard its infrastructure for the future. PayPal has become a payment method for Google Ads and Google Workspace. On May 05, the company reported Q1 2021 revenue of $6.03 billion, up 30.5% YoY, beating the estimates by $130 million. On February 4, Atlantic Equities analyst Kunaal Malde initiated a coverage on the stock, rating it as “Overweight,” with a price target of $315.00.
The hedge fund chaired by Chase Coleman holds 896,001 shares in the company worth $217 million. At the end of the first quarter of 2021, 143 hedge funds in the database of Insider Monkey held stakes worth $14.7 billion in PayPal Holdings, Inc. (NASDAQ: PYPL), down from 147 the preceding quarter worth $16 billion. Based on our calculations, PayPal Holdings, Inc. (NASDAQ: PYPL) ranks 8th in our list of the 30 Most Popular Stocks Among Hedge Funds.
Polen Capital Management mentioned PayPal Holdings, Inc. (NASDAQ:PYPL) in its Q4 2020 investor letter:
“For the full year 2020, one of the top performers was PayPal, which we purchased in 2019, the company continues to take market share in digital payments and has seen an acceleration in user adoption and engagement, especially within their “silver tech” or older user demographic. We expect many more years of ongoing double-digit growth from their various business segments and new initiatives.”
3. Salesforce.com, inc. (NYSE: CRM)
Coleman’s Stake Value: $484,907,000
Percentage of Chase Coleman’s 13F Portfolio: 1.11%
Number of Hedge Fund Holders: 91
salesforce.com, inc. (NYSE: CRM) is an American cloud-based software company, which provides customer relationship management platform. The company stock has offered investors more than 36% in returns over the course of the past twelve months. It was founded in 1999 and stands third on our list of 10 best tech and dividend stocks to buy according to billionaire Chase Coleman.
Salesforce posted earnings for the first quarter of 2021 on May 27, reporting earnings per share of $1.21, beating market predictions by $0.33. The revenue for the first three months of 2021 was $5.96 billion, up 22.57% YoY, beating the estimates by $73.32 million. In May, the stock was rated as “Overweight” at Morgan Stanley, where the price target was set at $270.00.
The hedge fund run by Chase Coleman owns more than 2.29 million shares in salesforce worth over $484 million, representing 1.11% of their portfolio. Out of the hedge funds being tracked by Insider Monkey, Fisher Asset Management is a leading shareholder in salesforce.com, inc. (NYSE: CRM) with 12.95 million shares worth more than $2.74 billion. Based on our calculations, salesforce.com, inc. (NYSE: CRM) ranks 27th in our list of the 30 Most Popular Stocks Among Hedge Funds.
ClearBridge Investments, in its Q1 2021 investor letter, mentioned salesforce. Here is what Polen Global Growth Fund has to say about salesforce in its letter:
“We added to our software-as-a-service (SaaS) exposure with the initiation of SaaS leader salesforce.com, which develops software for customer relationship management (we added Workday, which enterprise resource planning applications, last quarter). Saleforce.com is well-positioned in the most attractive end markets in software and will benefit from secular drivers such as remote work and the digital transformation. Salesforce.com is a sustainability leader as well, with a commitment to carbon-neutral cloud, toward which it has set a goal of 100% renewable energy for global operations by fiscal year 2022. The company has a strong focus on equality, in terms of equal rights, pay, education and opportunity. As a data company it has been leading on workforce disclosures and seeks to have 50% of its U.S. workforce made up of underrepresented groups by 2024.”
2. Shopify Inc. (NYSE: SHOP)
Coleman’s Stake Value: $572,669,000
Percentage of Chase Coleman’s 13F Portfolio: 1.31%
Number of Hedge Fund Holders: 91
Shopify Inc. (NYSE: SHOP) is a business company that provides a global business platform and assistance. Shopify stock has returned more than 65% to investors over the course of the past twelve months. It was founded in 2006 and is ranked second on our list of 10 best tech and dividend stocks to buy according to billionaire Chase Coleman. Just like Alibaba Group Holding Limited (NYSE: BABA), JD.com, Inc. (NASDAQ: JD) and Amazon.com, Inc. (NASDAQ: AMZN), Shopify is one of the best stocks to buy according to billionaire Chase Coleman.
In the first quarter of 2021, Shopify posted adjusted EPS of $2.01, which beat the market estimates by $1.26. The revenue over the period was $988.6 million, up 110.3% YoY, beating the estimates by $129.7 million. Last month, Loop Capital’s analyst Anthony Chukumba initiated a coverage on the stock, rating it as “Buy,” with a price target of $1,400.00.
Tiger Global Management LLC holds 517,550 shares in the company worth over $572 million, representing 1.31% of their portfolio. Tiger Global activity on Shopify stock increased by 168% in the past few months, the latest data reveals. At the end of the first quarter of 2021, 91 hedge funds in the database of Insider Monkey held stakes worth $9.98 billion in Shopify Inc. (NYSE: SHOP), down from 90 the preceding quarter worth $8.72 billion.
Based on our calculations, Shopify ranks 28th in our list of the 30 Most Popular Stocks Among Hedge Funds.
In its Q4 2020 investor letter, RGA Investment Advisors, an asset management firm, highlighted a few stocks and Shopify Inc. (NYSE: SHOP) was one of them. Here is what the fund said:
“While we are pleased with the results of these specific purchases, we made a huge mistake of omission at that time. This mistake will likely be one of the biggest we ever make in our careers. Specifically, we did deep work on Shopify and loved everything about the business qualitatively. Unfortunately, we ultimately found ourselves unable to get comfortable with the numbers.
We built our model up from the key performance indicators (KPIs) that drive revenues. Our last save of the model dated 8/3/2016 looked as follows: (Page 2). These numbers seemed right from everything we understood about the company. While we tend not to rely on sell-side consensus estimates before finishing our own workup of the business, we do give them a look once we feel comfortable with how we have approached our analysis as it is often helpful to get a sense of what the average participant in the market expects the business to do. With Shopify, the sell-side consensus was so far from where our numbers were shaking out, it seemed almost impossible that we were basing our analysis on the same underlying information. Our natural next step was thus to take the sell-side consensus data and work backwards to figure out the implied expectations on each of the key revenue drivers. Here is what the sell-side consensus looked like as at the time: (Page 2).
Shopify’s actual revenues for 2016-2018 ended up being $389m, $673m and $1,073m. In other words, not only were we justifiably far more optimistic than the consensus estimate, but we also were far too conservative in terms of how the company actually performed.
The nature of our job as securities analysts is to take calculated risks, in an uncertain world where the “true” answer is inherently unknowable before the fact. We operate in what many call an “efficient market” and subscribe to the belief that for the most part, markets are generally pretty efficient and it requires differentiated analysis to find a return above what the market can offer. So why did we pass on Shopify despite 1) deeply believing in the qualitative elements of the business; and, 2) seeing a meaningful gap between what we expected and the consensus expected? The answer is unfortunate but simple: we lacked confidence in ourselves. It was the first time we truly experienced such a stark divergence between our expectation and the consensus and the result was the inclination was to pound ourselves over the head with how dumb we must be, rather than the other way around. We also learned that the truly great companies use their strong business advantages, smart management and execution to raise the bar every step along the way. Obviously this is a cycle which cannot continue ad infinitum, but especially in instances where our qualitative work identifies the inherent strengths in the business and the numbers shake out to be quite fair, the consistent “raising of the bar” can be a potent driver for the stock.
Please do not judge us too harshly for our mistake on Shopify, for we have from the very beginning made one commitment above all else to both our clients and ourselves: that we will be better today than we were yesterday, and better tomorrow than we are today. While this mistake was quite costly, it ended up being a key confidence and process builder.”
1. Zoom Video Communications, Inc. (NASDAQ: ZM)
Coleman’s Stake Value: $787,226,000
Percentage of Chase Coleman’s 13F Portfolio: 1.81%
Number of Hedge Fund Holders: 54
Zoom Video Communications, Inc. (NASDAQ: ZM) is an American tech company providing video-conferencing and online-chat facility to its customers. Zoom stock has returned more than 66% to investors over the past year. The company was incorporated in 2011 and stands first on our list of 10 best tech and dividend stocks to buy according to billionaire Chase Coleman.
Last month SRAX, Inc., a financial technology company, united with Zoom Video to combine Zoom with the Sequire Audience feature in the Sequire platform. This collaboration will enable Sequire clients to host their meetings, webinars, or shows. On May 27, investment advisory UBS initiated coverage on Zoom stock with a “Neutral” rating and a price target of $325.00.
The hedge fund run by Chase Coleman owns more than 2.45 million shares in the tech company worth over $787 million, representing 1.81% of their investment portfolio. Tiger Global Management LLC has increased activity on Zoom stock by 70% in the past few months. Out of the hedge funds being tracked by Insider Monkey, ARK Investment Management is a leading shareholder in Zoom Video Communications, Inc. (NASDAQ: ZM), with 3 million shares worth more than $964 million.
Artisan Partners, in their Q1 2021 investor letter, mentioned Zoom. Here is what the fund said:
“We concluded our campaigns in Zoom Video Communications. We have been paring our position in Zoom for several quarters, anticipating the reduced need for video conferencing as vaccination rates climb and people return to their workplaces. That said, we believe there is a strong case to be made that the pandemic has prompted a permanent inflection in videoconferencing’s importance—sustainably higher remote work arrangements, more online learning and less business travel. Furthermore, the company’s dramatically expanded user base (up 485% YoY in Q3) positions it well to cross sell additional services, Zoom Phone in particular. The long-term future remains bright, but we decided to end our successful investment campaign in favor of opportunities in our pipeline with more attractive near-term growth prospects.”
You can also take a peek at 10 Best Tech Stocks To Buy Now According To Billionaire Laffont and 10 Best Tech Stocks to Buy According to Billionaire Ken Griffin.
