In this article, we discuss Steve Cohen’s top 5 tech stocks. If you want to see more stocks in this selection, click 10 Best Tech Stocks To Buy Now According To Billionaire Steve Cohen.
05. CrowdStrike Holdings, Inc. (NASDAQ:CRWD)
Point72 Asset Management’s Stake Value: $161.014 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.67%
Number of Hedge Fund Holders: 77
Steve Cohen’s Point72 upped its stake in CrowdStrike Holdings, Inc. (NASDAQ:CRWD) during Q2 by 603%, holding 955,234 shares as compared to 135,900 shares in the previous quarter. Chase Coleman and Feroz Dewan’s Tiger Global Management LLC is the largest shareholder of CRWD, holding 6.5 million of its shares worth roughly $1.10 billion. CRWD announced its Q2 results on August 30, reporting an EPS of $0.36 and revenue of $535.15 million, both above the market consensus.
On September 2, Peter Sazel, an analyst with Atlantic Equities, began covering CrowdStrike Holdings, Inc. (NASDAQ:CRWD) with a Neutral rating and a $200 price target. In a research note, Sazel informs investors that the company benefits from a first-mover advantage and amassed data that may have produced a network effect and a “strong moat.”
04. Broadcom Inc. (NASDAQ:AVGO)
Point72 Asset Management’s Stake Value: $162.022 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.68%
Number of Hedge Fund Holders: 66
Point72 increased its stake in Broadcom Inc. (NASDAQ:AVGO) as well by 26%, holding 333,509 of its shares, valued $162.2 million. Ken Fisher’s Fisher Asset Management is the largest shareholder of AVGO, holding 1.47 million of its shares worth roughly $716.29 million. Broadcom Inc (NASDAQ:AVGO) announced its latest quarterly earnings on September 1, reporting an EPS of $9.73, beating the market consensus by $0.18 and actual revenue of $8.46 billion, beating the estimate by $57.49 million. The company also generated $4.2 billion in free cash flow during the quarter, which smoothly covered its dividend payments of $1.7 billion. AVGO holds an 11-year track record of dividend growth. It pays a quarterly dividend of $4.10 per share, and its shares have a yield of 3.29%, as of September 7.
On September 2, William Stein, an analyst at Truist, decreased his price target for Broadcom from $658 to $630 while maintaining a Buy recommendation for the stock. Despite the recent unfavorable tech data points, the company had another fantastic quarter with above-consensus forecasts and excellent messaging surrounding the supply chain, the analyst tells investors in a research note. According to Stein, investors should purchase Broadcom stock because of its 3.3% dividend yield, his prediction of a 20% dividend increase this year, and the advantages of M&A.
03. Arista Networks, Inc. (NYSE:ANET)
Point72 Asset Management’s Stake Value: $177.227 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.74%
Number of Hedge Fund Holders: 48
Point72 added Arista Networks, Inc. (NYSE:ANET) to its portfolio during Q1, 2021, holding 96,000 of its shares, valued at $7.2 million. It currently holds 1.89 million shares of ANET worth roughly $177.2 million. Hedge funds are bullish on ANET, with the stock touching the peak of its popularity among the hedge funds tracked by Insider Monkey during Q2. The number of hedge funds holding ANET shares increased in the past three out of four quarters.
On August 24, Matthew Niknam of Deutsche Bank began coverage of the company with a Hold rating and a $135 price target. As the company increases market share in its primary markets for data center switching and cloud networks, the analyst predicts revenue growth of 18% annually through 2025. He bases the hold rating on value.
Artisan Mid Cap Fund, in its Q4 2021 investor letter, mentioned Arista Networks, Inc. (NYSE: ANET) and discussed its stance on the firm. Here is what the fund said:
“Arista Networks is the market leader for cloud networking equipment used in data centers for public, private and hybrid cloud deployments. The company’s top line growth has recently been bolstered by 400G deployments—the next generation of tech powering data centers—and further enterprise network penetration as customers migrate away from Cisco (~80% market share vs. ~5% for Arista). While the profit cycle is nicely in motion, we pared our exposure as shares began to approach our PMV estimate.”
02. ServiceNow, Inc. (NYSE:NOW)
Point72 Asset Management’s Stake Value: $179.716 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.75%
Number of Hedge Fund Holders: 99
Steve Cohen’s Point72 has been a shareholder of ServiceNow, Inc. (NYSE:NOW) since Q2, 2014. During this time, it sold its entire stake in the company several times. However, currently, it holds 377,936 ServiceNow shares, worth roughly $179.7 million.
With a Neutral rating and a $510 price target, Guggenheim analyst John DiFucci began covering ServiceNow, Inc. (NYSE:NOW) on August 11. ServiceNow, though “a very well-run firm,” will probably fall short of its long-term subscription revenue targets in 2024 and 2026, according to DiFucci.
Ensemble Capital recently published its 2022 Q2 investor letter. Here is what the fund specifically said about ServiceNow (NOW):
“ServiceNow is an enterprise software company that helps their corporate customers integrate all of their various software products into a unified platform. Their products are a key element of driving the digital transformation nearly every large company is undergoing. At the recent JP Morgan investor day, CEO Jamie Dimon explained that while the company could reduce expenses if needed should the economy slow, that their spending on digital transformation would continue as this spending was critical to the company managing costs and maximizing revenue over time. As an example of this type of spending, Dimon specifically pointed to ServiceNow, calling out that the company’s products now oversaw the single largest collection of JP Morgan data and highlighted that working with them had saved JP Morgan $50 million over the past few years.
While we have high expectations for ServiceNow’s long-term growth rate, at the company’s investor day in late May they offered an increased growth outlook for the next five years as they target even higher levels of growth than we have been expecting.”
01. Take-Two Interactive Software, Inc. (NASDAQ:TTWO)
Point72 Asset Management’s Stake Value: $189.103 million
Percentage of Point72 Asset Management’s 13F Portfolio: 0.79%
Number of Hedge Fund Holders: 66
During Q2, Point72 increased its stake in Take-Two Interactive Software, Inc. (NASDAQ:TTWO) by 735%, holding 1.54 million of its shares, valued at $189.1 million. TTWO touched the peak of its popularity among hedge funds tracked by Insider Monkey during the most recent quarter, with 66 hedge funds holding a stake in TTWO.
Take-Two Interactive Software, Inc. (NASDAQ:TTWO) announced its latest quarterly earnings results on August 8, reporting an EPS of $0.74 and actual revenue of $1 billion, both below the market consensus. On September 6, while keeping a Buy rating on the shares, Truist analyst Matthew Thornton reduced his price target for Take-Two from $162 to $157.
Here is what Arch Capital has to say about Take-Two Interactive Software, Inc. in its Q4 2021 investor letter:
“Take-Two Interactive is an American video game publisher of franchises like Grand Theft Auto (GTA), Red Dead Redemption (RDR), and NBA 2K. It is currently one of the larger positions in the fund at an 8.3% allocation.
We are bullish on Take-Two because we believe the company has competitive advantages that will keep its franchises relevant for many years. First, its games have distinct network effects that keep it insulated from competitors. Multiplayer online games are only fun if others are also playing them, creating a winner-take-all effect that has specifically benefited GTA and NBA 2K over the last decade.
On top of network effects, Take-Two has decades of developmental expertise and over 5,000 developers across its divisions, giving it semi-strong economies of scale that insulate it from most competitors. Yes, large competitors like Microsoft or any mega-cap company could invest the dollars to get to this developer count, but it is impossible for a smaller studio to make games as immersive and at as quick of a pace as Take-Two does for its customers. They just don’t have the scale…” (Click here to see the full text)
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