Goldman Sachs’ Top 5 Stock Picks for 2024

4. NVIDIA Corporation (NASDAQ:NVDA)

Goldman Sachs’ Q4 2023 Investment Value: $7.08 billion

Number of Hedge Fund Holders: 173

NVIDIA Corporation (NASDAQ:NVDA), an American multinational technology company headquartered in Delaware, is renowned for its expertise in integrated circuit development. Its proficiency spans various devices, from electronic game consoles to personal computers (PCs).

In Q4 2023, 173 out of the 933 hedge funds tracked by Insider Monkey held a stake in NVIDIA Corporation (NASDAQ:NVDA). Rajiv Jain’s GQG Partners emerged as the largest stakeholder, with investments totaling $6.8 billion in the company.

SaltLight Capital stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its fourth quarter 2023 investor letter:

“We were fortunate to have some exposure to some of the ‘Magnificent Seven’ – Amazon, NVIDIA Corporation (NASDAQ:NVDA), Meta Platforms and Google (although in aggregate, we still hold a smaller weighting than the S&P 500).

While we are cautious in AI infrastructure, we do think there are mispriced opportunities in areas of application software where AI can be infused to make a step change improvement. Posted in our office is this chart that ASML provides at each of its investor days. This chart is a little outdated from 2021, but we think illustrates how value (in operating profit) was distributed across semiconductors, hardware, and then software & services. It’s very clear that most of the economic value in the past has accrued to the software services (in gray) built on the backs of highly technical companies run by extremely smart people.

Why is this? We think it is due to a combination of distribution and network effects. Our working hypothesis right now is that this will likely remain a similar outcome in the AI epoch. One outlier right now is Nvidia which is capturing 80% margins..” (Click here to read the full text).