Though George Soros is most popularly known for his footprint in the currency markets, the infamous investor also has a pretty sterling track record managing equities, so much so that his fund, Soros Fund Management, manages a 13F portfolio upwards of $8 billion.
At Insider Monkey, we’ve shown time and time again that retail investors can benefit from piggybacking top-tier money managers (discover the secrets of this strategy), and Soros is among the best of the best. While there are many ways we can parse this data, Soros’ latest first quarter filing indicates that he’s make some intriguing moves in the technology sector. Let’s take a peek.
Google over Apple
Google Inc (NASDAQ:GOOG) is Soros’ biggest tech bet from the first quarter; the magnate’s Google Inc (NASDAQ:GOOG) stake in company nearly doubled last quarter (from the end of 2012) to 337,271 shares worth $267.8 million, and is now one of the most valuable holdings in Soros’ entire 13F portfolio. Aggregately speaking, Google Inc (NASDAQ:GOOG) was the second most popular stock pick among the hedge funds we track, as 146 of the 500 managers we track reported positions at the end of March. Apple Inc. (NASDAQ:AAPL) came in first with 148 long hedge funds.
The Apple Inc. (NASDAQ:AAPL)-Google Inc (NASDAQ:GOOG) comparisons don’t stop there, however. Soros cut his Apple Inc. (NASDAQ:AAPL) stake by 85% in the first quarter, and he’s been rewarded thus far, with shares returning just 0.5% since the start of April. Google Inc (NASDAQ:GOOG), meanwhile, has popped nearly 10% since the beginning of the second quarter.
Although much of Apple Inc. (NASDAQ:AAPL)’s appreciative potential moving forward looks to rest on its next generation of devices, it’s important not to forget that Google has plenty of factors that can drive shares past the $1,000 mark as well. Aside from its Spotify-like music streaming service announced earlier this month, Google has OLED-equipped Google Glass up its sleeve, and the oft-speculated X Phone isn’t dead just yet.
Regardless of the valuation, though, it’s important to understand that Soros is going with Big G over Cupertino, and at the end of the day, that means he’s favoring momentum over value. Apple Inc. (NASDAQ:AAPL) may sport a more attractive earnings multiple than Google, but Soros’ actions indicate he’s still unwilling to buy based on valuation alone.
The best of the rest
Behind Google, NetApp Inc. (NASDAQ:NTAP) is Soros’ second largest tech holding, with a $121.3 million position reported in his latest 13F. Soros Fund Management owns 3.5 million shares of the data storage player, which has recently announced that it’s upping its existing share buyback program to $3 billion in full over the next 36 months and a 15-cent per share quarterly dividend. Lee Ainslie, D.E. Shaw and Jim Simons are also bullish on NetApp Inc. (NASDAQ:NTAP)’s shareholder-friendly ways, and this is a good stock for piggybackers to research further.
In Shutterfly, Inc. (NASDAQ:SFLY), the hedge fund disclosed a $122 million holding, up from $91 million at the end of 2012, as shares have returned a whopping 63.7% year-to-date. Like Google and NetApp, the valuation isn’t really any of Soros’ concern here, as Shutterfly shares do trade at a forward P/E of 49.3x. Wall Street’s average price target predicts another 7-8% of upside from current levels, and Shutterfly, Inc. (NASDAQ:SFLY)’s acquisitive nature should continue to drive growth.