Giverny Capital, an asset management firm, published its fourth-quarter 2021 investor letter – a copy of which can be downloaded here. A quarterly net return of 10.73% was delivered by the fund for the fourth quarter of 2021, slightly below its benchmark, the S&P 500 Index, which delivered an 11.03% gain for the same period. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.
Giverny Capital Asset Management, in its Q4 2021 investor letter, mentioned Alphabet Inc. (NASDAQ: GOOG) and discussed its stance on the firm. Alphabet Inc. is a Mountain View, California-based multinational technology conglomerate holding company with a $1.7 trillion market capitalization. GOOG delivered a -7.87% return since the beginning of the year, while its 12-month returns are up by 45.22%. The stock closed at $2,665.79 per share on January 28, 2022.
Here is what Giverny Capital Asset Management has to say about Alphabet Inc. in its Q4 2021 investor letter:
“It is simplistic but true that it’s easier to grow a $10 billion market cap to $30 billion than to grow a $30 billion market to $90 billion. We’re delighted to increase our exposure to midcap stocks, especially while gaining exposure to the growing network communications sector.
That said, since inception our largest position has been Alphabet. After a huge run in 2021, Alphabet’s market cap approaches $2 trillion. The core search business is a product most of us cannot do without and is well appreciated by the market. If there is a knock on Alphabet, it would be over capital allocation. The company spends $25 billion annually on research and development, some of it in farflung areas. R&D is not quite a black box, but it’s hard for investors to know how wisely Alphabet spends this budget.
However, quite a few of Alphabet’s investments have turned out brilliantly for shareholders: YouTube, Double Click and Android, to name three. Its Waymo division, which is developing self-driving cars, likely is worth tens of billions of dollars. We think Alphabet is at the forefront of research on machine learning and artificial intelligence. In November, a friend sent us two days of wire service items on Alphabet. It looked like this:…” (Click here to see the full text)
Pixabay/Public Domain
Our calculations show that Alphabet Inc. (NASDAQ: GOOG) ranks 5th on our list of the 30 Most Popular Stocks Among Hedge Funds. GOOG was in 156 hedge fund portfolios at the end of the third quarter of 2021, compared to 155 funds in the previous quarter. Alphabet Inc. (NASDAQ: GOOG) delivered a -10.10% return in the past 3 months.
In December 2021, we also shared another hedge fund’s views on GOOG in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.
Disclosure: None. This article is originally published at Insider Monkey.
