Beech Hill’s Favorite Tech Stocks This Quarter

Beech Hill Partners, a firm headed by Paul Cantor, Joseph Weiss and Will Wurm, is betting big on the technology sector; as of the end of March the sector represented about 27% of the fund’s equity portfolio. The fund managers are wary of the prevailing market turbulence and as a hedge against they have been more inclined to keep large cash balances and investments are mostly made in high-yielding large-cap companies with strong balance sheets and high free cash flow generation. This us then take a look at which companies fulfill this criteria.

Our research determined that following the small-cap stocks, that hedge funds are collectively bullish on, can help a smaller investor beat the S&P 500 by around 95 basis points per month (see more details here).

#5 QUALCOMM, Inc. (NASDAQ:QCOM)

– Shares Owned by Beech Hill (as of March 31): 74,300

– Value of Holding (as of March 31): $3.80 Million

During the first quarter Beech Hill only added 100 shares to its QUALCOMM, Inc. (NASDAQ:QCOM) position. The stock price of the $77 billion technology company is up by 5.6% so far this year, on the heels of Qualcomm’s satisfactory financial results for the second fiscal quarter in which it managed to beat both top- and bottom-line estimates. The guidance for the third quarter was, however, a mixed one as compared to the expectations that analysts had. Two other recent noteworthy developments involving Qualcomm include the settlement of an arbitration dispute with LG and a 3G/4G patent licensing deal struck with Chinese OEM Hisense. Ken Fisher‘s Fisher Asset Management hiked its QUALCOMM, Inc. (NASDAQ:QCOM) holding by 2% during the first quarter to 9.56 million shares.

 

#4 Cisco Systems, Inc. (NASDAQ:CSCO)

– Shares Owned by Beech Hill (as of March 31): 143,400

– Value of Holding (as of March 31): $4.08 Million

Beech Hill inched up its stake in the San Jose-based company by 3% during the first three months of 2016. While trading almost flat year-to-date, Cisco Systems, Inc. (NASDAQ:CSCO)’s shares are down by more than 7% in the last twelve months, which is still better than the decline of 19% of the communications equipment industry during the same period. Cisco recently has signed a deal with Hyundai, in order to help it establish an industry-leading connected car platform for high-speed transfers of large amounts of data. Moreover, Cisco is also planning to increase its footprint in the networking semiconductor space by acquiring Israel-based Leaba Semiconductor for $320 million in cash. Edinburgh Partners, led by Sandy Nairn, trimmed its Cisco Systems, Inc. (NASDAQ:CSCO) stake by 4% in the first quarter to 2.85 million shares.

 

#3 Alphabet Inc (NASDAQ:GOOGL)

– Class A Shares Owned by Beech Hill (as of March 31): 7,200

– Value of Holding (as of March 31): $5.5 Million

After slashing its stake by 29% in the January-March period, Beech Hill’s Alphabet Inc (NASDAQ:GOOGL) stake represented 4.3% of the firm’s equity portfolio. Although a part of nifty nine last year, or the nine stocks that lead the market, Alphabet has had a rough start to the year, and is down by nearly 7%. The company failed to meet analyst expectations in its financial results for the first quarter, missing both top- and bottom-line estimates. Cost per click (CPC) slid by 9% on a year-over-year basis. The CPC decline on Google sites amounted to 12% and was 8% elsewhere. Moreover, European Union has introduced another facet in its antitrust battle against Google. The tech giant is now also being accused of using its dominant position in Android operating system to limit competition.  Barry Dargan‘s Intermede Investment Partners raised its holding in Alphabet Inc (NASDAQ:GOOGL) by 42% in the first quarter to over 69,000 shares.

#2 Facebook Inc (NASDAQ:FB)

– Shares Owned by Beech Hill (as of March 31): 65,900

– Value of Holding (as of March 31): $7.52 Million

Even though it is still Beech Hill’s second largest holding, but it was reduced by a significant 22% during the first trimester. Worried about users adopting a more passive attitude and scrolling through other people’s content rather than creating their own, Facebook Inc (NASDAQ:FB) is developing a Snapchat-like camera app, according to Wall Street Journal. The social networking platform has also benefitted significantly from the mobile platform as 80% of fourth quarter revenues came from that segment as compared to about 25% three years ago. The stock price has climbed up by 15% so far this year boosted by strong financial results delivered in the first quarter. David Kelden‘s Bukingham Capital Management raised its exposure to Facebook Inc (NASDAQ:FB) by 21% to 109,800 shares during the first quarter.

 

#1 Apple Inc. (NASDAQ:AAPL)

– Shares Owned by Beech Hill (as of March 31): 84,309

– Value of Holding (as of March 31): $9.19 Million

Almost unchanged, Beech Hill’s Apple Inc. (NASDAQ:AAPL) holding represented 7.19% of its portfolio. The stock is down by nearly 0.9% on a year-to-date basis following rather dull financial results for the second fiscal quarter. While the reported EPS of $1.9 missed expectations by $0.1, revenues of $50.6 billion were $1.37 billion short of the figure analysts had in mind. Sales of iPhones and iPads were above expectations, but Mac sales missed the projections. Eric Sprott’s Sprott Asset Management initiated a stake in Apple Inc. (NASDAQ:AAPL) during the first three months and reported holding 355,500 shares in its latest 13F filing.

 

Disclosure: None