We recently published a list of Top 10 Stocks to Buy According to Jericho Capital Asset Management. In this article, we are going to take a look at where Meta Platforms, Inc. (NASDAQ:META) stands against other top stocks to buy according to Jericho Capital Asset Management.
Jericho Capital Asset Management, founded in 2009 by Josh Resnick, is a New York-based hedge fund manager specializing in long/short equity strategies across developed and emerging markets. Resnick established the firm with a focus on identifying market inefficiencies and capitalizing on both undervalued and overvalued securities. The investment management firm specializes in the global technology, media, and telecommunications (TMT) sectors, offering a range of financial planning, advisory, and asset management services to institutional clients and high-net-worth individuals.
As an investment advisor, Jericho Capital provides discretionary investment advisory services to pooled investment vehicles, including hedge funds and private equity funds. These funds are typically structured as master-feeder funds, where feeder funds allocate their capital to a centralized master fund managed by the firm. This structure allows investors to access a diversified portfolio while benefiting from the firm’s expertise in security selection. Given the speculative nature of its strategies, the firm cautions investors about the substantial risks involved, including the potential for significant or complete loss of capital.
Jericho Capital employs a long/short investment strategy, aiming to generate returns by purchasing undervalued securities and short-selling overvalued ones. The firm may also pursue special opportunities strategies, which can involve distinct transaction costs and pricing structures. The success of these approaches relies heavily on the firm’s ability to accurately assess market opportunities, a process that is inherently complex and subject to fluctuations. Market volatility and economic disruptions can lead to unforeseen losses, requiring the firm to make strategic adjustments to protect investor capital.
Despite the risks, Jericho Capital’s approach appeals to investors seeking alternative investment strategies with the potential for high returns. By leveraging its expertise in equity markets, the firm positions itself as a key player in the hedge fund industry. While its investment styles involve substantial risks, its track record and disciplined investment framework make it a notable choice for those willing to embrace volatility in pursuit of long-term gains.
Currently the founder and managing partner of Jericho Capital, Josh Resnick played a key role at TCS Capital before launching Jericho Capital. TCS Capital was a prominent TMT-focused hedge fund that he joined shortly after its inception in 2001. Resnick’s extensive experience in finance and investment spans multiple industries, with a focus on identifying high-growth opportunities within rapidly evolving markets. Prior to his tenure at TCS Capital, Resnick served as a Managing Director at KPE Ventures, a New York-based venture capital firm dedicated to investments in media, entertainment, and technology. His expertise in business development was further honed during his time at Fox Entertainment Group in Los Angeles, where he was part of a strategic team overseeing expansion initiatives. He began his career in investment banking at Bear Stearns, working in the media and entertainment sector, where he gained critical experience in mergers, acquisitions, and corporate finance.
Resnick holds a Bachelor of Arts degree in Economics from Emory University, where he graduated Summa Cum Laude. His academic background provided a strong foundation for his career in investment management, equipping him with analytical skills essential for navigating complex financial markets. Beyond his professional achievements, Resnick is actively involved in philanthropy. He serves on the Board of Directors of the Child Mind Institute in New York City, a nonprofit organization dedicated to supporting children with mental health and learning disorders. His commitment to both finance and social impact underscores his well-rounded leadership in the investment world.
As of its latest filing for the fourth quarter of 2024, Jericho Capital Asset Management reported managing approximately $7 billion in 13F securities. The firm maintains a moderately concentrated portfolio, with its top ten holdings making up 64.13% of total assets. This level of concentration suggests a high-conviction investment strategy, where the firm places significant emphasis on a select group of stocks it believes have strong growth potential. The firm’s investment decisions reflect its focus on the global technology, media, and telecommunications sectors, indicating confidence in the long-term growth prospects of these industries. Overall, Jericho Capital’s portfolio structure highlights its strategic focus and deep industry expertise. Its investment approach aligns with a belief in innovation-driven sectors, making it a key player in the hedge fund landscape.
Our Methodology
The stocks discussed below were picked from Jericho Capital Asset Management’s Q4 2024 13F filings. They are compiled in the ascending order of the hedge fund’s stake in them as of December 31, 2024. To assist readers with more context, we have included the hedge fund sentiment regarding each stock using data from 1009 hedge funds tracked by Insider Monkey in the fourth quarter of 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A team of developers working in unison to create the company’s messaging application.
Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders as of Q4: 262
Jericho Capital Asset Management’s Equity Stake: $358.83 Million
OpenAI and Meta Platforms, Inc. (NASDAQ:META) are in discussions with Reliance Industries to expand their artificial intelligence (AI) footprint in India. OpenAI has identified the Indian company as a potential distribution partner for its AI products, including ChatGPT, allowing Reliance to enhance product distribution and advertising across India’s growing AI market. Additionally, Reliance is considering selling OpenAI’s models to Indian businesses via an application programming interface (API), enabling enterprises to integrate advanced AI capabilities into their operations. To align with India’s data sovereignty principles, OpenAI’s models could be hosted locally within Reliance’s infrastructure, ensuring that sensitive customer data remains within national borders.
Meta Platforms, Inc. (NASDAQ:META) is also exploring a partnership with Reliance to strengthen its position in India’s AI sector. Having previously invested in Jio telecommunications, Meta aims to leverage this collaboration to expand its digital and AI initiatives in the country. This potential alliance would reinforce Meta’s leadership in Indian technological innovation while benefiting from Reliance’s vast market presence. However, Indian regulators are closely monitoring the influence of foreign AI firms as they work on policies to balance technological advancements with the protection of domestic innovation. The evolving regulatory landscape will play a key role in shaping how these global tech giants operate within India’s AI ecosystem.
Meta Platforms, Inc. (NASDAQ:META), meanwhile, continues to invest heavily in AI infrastructure, with projected expenses reaching up to $119 billion for 2025. The company is expanding its Meta Training and Inference Accelerator (MTIA) program, aiming to develop in-house AI chips to reduce reliance on Nvidia. Despite previous setbacks, Meta’s first AI inference chip for recommendation systems has been successful, highlighting its ambition to take greater control over its AI ecosystem. Financially, Meta’s rapid AI advancements have driven strong performance, with Q4 2024 revenue surging 21% year-over-year to $48.4 billion, exceeding analyst expectations. Earnings per share (EPS) also jumped 50% to $8.02, further solidifying Meta’s dominance in digital advertising and AI-driven growth.
Rowan Street Capital stated the following regarding Meta Platforms, Inc. (NASDAQ:META) in its Q4 2024 investor letter:
“Meta Platforms, Inc. (NASDAQ:META): Investment Initiated: April 2018: Internal Rate of Return (IRR*): 22% *IRR represents the annualized rate of return on an investment, accounting for the timing and magnitude of cash flows over the holding period.
For META, our 22% IRR aligns closely with the company’s compounded growth in earnings per share (EPS) and free cash flow per share during the 6 years holding period.
Looking ahead, Meta is expected to grow its revenues, earnings, and free cash flow per share at mid-teens rates over the next two years. There’s a good possibility that it could exceed these estimates, considering the breadth of growth initiatives currently in place, such as advancements in Al, monetization of Reels, expansion into business messaging, and the ongoing development of the metaverse…” (Click here to read the full text)
Overall, META ranks 5th on our list of top stocks to buy according to Jericho Capital Asset Management. While we acknowledge the potential for META as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than META but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
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