Here Are This Top Hedge Fund’s Conviction Technology Picks

#3 Check Point Software Technologies Ltd. (NASDAQ:CHKP)

Shares held (as of September 30): 5,500
Total Value (as of September 30): $436,000
Percent of Portfolio (as of September 30): 0.11%

Horseman Capital increased its position in Check Point Software Technologies Ltd. (NASDAQ:CHKP) by 3,000 shares to 5,500 duirng the third quarter, after the software security company handily beat its second quarter earnings estimates by $0.04 per share and revenue expectations by $2.42 million. Deferred revenue growth was strong while guidance was in-line. The company also spent $245 million on share buybacks. With a forward P/E of 17.88 versus the NASDAQ’s forward P/E of 17.75, shares aren’t cheap, but analysts think there is plenty of growth ahead, with an average next-five-year EPS ratio of 10.78%. Given network security is so important to businesses around the world, growth could surprise on the upside. David Blood and Al Gore‘s Generation Investment Management owned 5.81 million shares of the company at the end of June.

#2 Paypal Holdings Inc (NASDAQ:PYPL)

Shares held (as of September 30): 400,700
Total Value (as of September 30): $12.44 million
Percent of Portfolio (as of September 30): 3.16%

The company Elon Musk co-founded is now fully independent, having spun off from eBay Inc (NASDAQ:EBAY) in July. With the right M&A and investment in R&D, Paypal Holdings Inc (NASDAQ:PYPL) could also be one of the world’s largest financial institutions by market capitalization over the next decade or two, as online finance technologies are only beginning to catch their stride. Analysts are bullish on the payment company’s propsects. One analyst has a ‘Strong Buy’ rating, 24 have a ‘Buy’ rating, five have a ‘Sell’ rating, and nine have a ‘Hold’ rating. Overall, analysts have a consensus price target of $42.38 per share, giving shares an upside potential of 21.13%. Horseman Capital is bullish too, as Paypal was a new position for the fund in the third quarter.

#1 Alphabet Inc (NASDAQ:GOOGL)

Shares held (as of September 30): 26,500
Total Value (as of September 30): $16.92 million
Percent of Portfolio (as of September 30): 4.30%

While its name might be different, Alphabet Inc (NASDAQ:GOOGL) is still the same dominant search company that it was a year ago. Alphabet Inc/Google has the majority market share in the most lucrative ad market of all: online search, and contrary to what bears had hoped, the company’s search/ad business is growing – third quarter paid clicks increased by 23% year-over-year and rose by 6% quarter-over-quarter. Rather than just spending billions on world-changing technologies such as automated cars and artificial intelligence, management is also spending billions on shareholders, with the company having recently announced the authorization of a $5 billion share buyback program. Investors hope the buyback announcement will be the first of many to come.  Given its wide moat and reasonable forward P/E of 20.57, shares of Alphabet Inc are a good bet for long-term holders.

Disclosure: None