Louis G. Navellier, the author of the bestseller “The Little Book That Makes You Rich”, established Navellier & Associates in 1980. The fund, which focuses on growth investments, has expanded by leaps and bounds in the past three decades, and now has a $1.06 billion equity portfolio. Since Navellier & Associates recently filed its 13F, let’s take a closer look at his top tech picks, which include Avago Technologies Ltd (NASDAQ:AVGO), Electronic Arts Inc. (NASDAQ:EA), Facebook Inc (NASDAQ:FB), Microsoft Corporation (NASDAQ:MSFT), and Intel Corporation (NASDAQ:INTC).
But why are we interested in the hedge fund activity? From one point of view we can argue that hedge funds are consistently underperforming when it comes to net returns over the last three years, compared to the S&P 500. But that doesn’t mean that we should completely neglect their activity. There are various reasons behind the low hedge fund returns. Our research indicated that hedge funds’ long positions actually managed to beat the market. In our backtests covering the 1999-2012 period hedge funds’ top small-cap stocks edged the S&P 500 index by double digits annually. The 15 most popular small-cap stock picks among hedge funds also bested passive index funds by around 53 percentage points over the 36 month period beginning from September 2012 (see more details here).
# 5 Intel Corporation (NASDAQ:INTC)
Shares held (as of September 30): 142,460
Total Value (as of September 30): $4.29 million
Percent of Portfolio (as of September 30): 0.43%
Because of Intel Corporation (NASDAQ:INTC)’s dominant position in PC CPU’s, Intel Corporation has economies of scale that affords its fat margins and substantial cash flow to enter adjacent markets. Although Intel hasn’t captured much market share in mobile and is losing around $4 billion a year in that sector, the company is succeeding in the Internet of Things and the cloud segments. The latter two’s growth has largely offset Intel’s declining PC business. At 14.27 times forward earnings, Intel’s shares look attractive. They also pay a nice 2.87% dividend too. First Eagle Investment Management owned 28.48 million shares of Intel at the end of June.