Were Hedge Funds Right Betting On These Tech Stocks in Q4?

#4 Amazon.com Inc. (NASDAQ:AMZN)

Hedge Funds with Long Positions (as of September 30): 113

Fourth-quarter Return: 32.04%

Shares of Amazon.com Inc. (NASDAQ:AMZN) gained 32% in the last quarter of fiscal year 2015, and are up 109% over the past one year. A total of 113 hedge funds tracked by Insider Monkey were invested in the company at the end of the third quarter, as compared with 103 funds a quarter earlier. It is believed that Amazon is planning an aggressive expansion of its Amazon Web Services (AWS)’s data center footprint, which could put some weight on profit margins in the near-term. Nonetheless, the fast-growing top-line results of Amazon’s North American retail segment and AWS segment will most likely overshadow the transitory impacts on earnings.

Meanwhile, Amazon’s fourth-quarter guidance shows that the company anticipates its net sales to be in the range of $33.50 billion-to-$36.75 billion, which denotes an increase of 14%-to-25% year-on-year. Andreas Halvorsen’s Viking Global upped its positon in Amazon.com Inc. (NASDAQ:AMZN) by 33% during the July-to-September period to 3.02 million shares.

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#3 Facebook Inc. (NASDAQ:FB)

Hedge Funds with Long Positions (as of September 30): 128

Fourth-quarter Return: 16.42%

Facebook Inc. (NASDAQ:FB) lost some of its charm among the hedge funds tracked by our team, but its shares advanced by 16% in the fourth quarter of 2015. Numerous analysts and financial hubs anticipate that the social networking company will generate strong revenue growth from video ads and higher monetization efforts of Instagram in the upcoming quarters.

In early November, Rosenblatt Securities reiterated its ‘Buy’ rating on the stock and increased its price target to $125 from $115, claiming that Facebook represents its top stock pick across the Internet, media and entertainment space for 2016. Facebook is set to release its fourth-quarter and full year 2015 financial results after the market close on January 27, thus revealing the fruits of the management’s monetization efforts. In the meantime, Rosenblatt Securities anticipates Instagram to generate roughly $1 billion in global advertising revenues in 2016. Stephen Mandel’s Lone Pine Capital reported ownership of 10.70 million shares in Facebook Inc. (NASDAQ:FB) through its 13F for the third quarter.

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