4 Growth Stocks Billionaire Money Managers Racked Up During The First Quarter

You may not realize it, but Monday May 16, 2022 marked one of the most important dates for the investment community. It was the deadline for institutional and hedge fund managers with at least $100 million in assets under management to file Form 13F with the Securities and Exchange Commission.

In simple terms, a 13F provides an inside look at what the brightest and most successful money managers bought, sold, and held during the last completed quarter (in this case, the first quarter). Although the data is at least six weeks old at the time it is released, it provides clues as to what stocks and trends are wowing fund managers.

Image source: Getty Images.

With market volatility rising sharply during the first quarter, billionaire money managers were busy. However, this volatility did not scare billionaires away from investing heavily in growth stocks. Based on a slew of 13F filings, billionaire money managers piled into these four growth stocks.

Metaplatforms

first is Metaplatforms (FULL BOARD -0.49%), the company formerly known as Facebook. During the first quarter, Jeff Yass of Susquehanna International, Stephen Mandel of Lone Pine Capital and Jim Simons of Renaissance Technologies took significant stakes in Meta. Respectively, Susquehanna, Lone Pine and Renaissance added approximately 3.99 million shares, 3.66 million shares and 2.27 million shares.

Although Meta is dealing with a number of headwinds, including AppleWith iOS privacy changes and the growing possibility of a US recession (ad-driven companies often see slow or inverse revenue growth during recessions), billionaires clearly see the value in privacy. platform.

For example, Meta ended the first quarter with 3.64 billion monthly active users across its family of apps (Facebook, WhatsApp, and Instagram). This means that more than half of the world’s adult population visits a Meta-owned asset at least once a month. Advertisers are well aware that their best opportunity to reach a wide audience is with Meta’s ultra-popular social networking sites. And this, in turn, is what often gives Meta substantial advertising pricing power.

The company is also historically cheap. Even with Meta’s aggressive spending in the metaverse, Wall Street anticipates that the company will generate more than $14 in earnings per share by 2023. 14 is unbelievably low.

A Nio ET7 electric sedan in a showroom.

Nio’s ET7 electric sedan was launched in late March 2022. Image source: Nio.

child

Another growth stock that billionaire money managers couldn’t get enough of in the first quarter is the China-based electric vehicle (EV) maker. child (LITTLE BOY 5.24%). Simons’ Renaissance Technologies, John Overdeck and David Siegel’s Two Sigma Investments, and Ray Dalio’s Bridgewater Associates were big buyers. Respectively, these funds added approximately 5.18 million shares, 5.04 million shares and 2.26 million shares.

Like most auto stocks, Nio faces huge supply chain challenges. There have been shortages of semiconductor chips across the industry, with the company dealing with parts shortages linked to COVID-19 lockdowns in several provinces in China.

But despite these challenges, Nio rightly has billionaires on the gas. At the end of last year, the company was producing electric vehicles at an annual rate of more than 120,000, showing that it can rapidly ramp up production once supply chain challenges subside.

Also, despite being a newer automaker, Nio is innovative. For example, its newly introduced sedans, the ET7 and ET5, offer premium battery options that allow around 620 miles on a single charge. That should allow Nio’s sedans to directly compete with, and take part in, Tesla‘s flagship sedans, the Model 3 and Model S.

Nio’s battery-as-a-service subscription could also be a game-changer in the long run.

Two employees looking at large amounts of data on three computer monitors.

Image source: Getty Images.

data dog

The billionaires were also very excited to enter the cloud-based application monitoring and security company. data dog (DDOG 9.60%) during its first quarter settlement. Ken Griffin’s Citadel Advisors, Overdeck and Siegel of Two Sigma, and Israel Englander’s Millennium Management were all active buyers. Respectively, Citadel, Two Sigma and Millennium added approximately 614,200 shares, 203,200 shares and 175,800 shares.

As with most growth stocks, Datadog’s valuation has proven to be its worst enemy since the beginning of the year. Even after a 51% drop from a 52-week high, the company’s shares are still valued at 19 times forecast sales for 2022, as well as close to 100 times Wall Street’s forecast earnings for next year. When economic slowdowns and recessions hit, cyclical companies in the technology sector often feel the pinch.

The good news for Datadog and its shareholders is that the company is at the center of a seemingly unstoppable trend. With businesses moving their data online and in the cloud at a rapid pace in the wake of the pandemic, the company is perfectly positioned to help with that transition and help businesses better understand their customer behavior.

It has been particularly successful courting larger clients. Datadog ended March 2022 with approximately 2,250 customers generating at least $100,000 in annual recurring revenue. That represents a 60% increase from the prior year period and indicates that Datadog’s superior growth rate is unlikely to slow down anytime soon.

A doctor administering a vaccine to a patient's upper left arm.

Image source: Getty Images.

Novavax

Biotech Stock Novavax (NVAX 12.13%) it’s another growth stock that billionaire fund managers bought hand over fist in the first quarter. Coatue Management’s Philippe Laffont, Englander’s Millennium Management and Griffin’s Citadel Advisors were all buyers. Respectively, these funds bought 883,400 shares, 609,300 shares and 484,600 shares in the first quarter.

Novavax’s promise and danger lie in NVX-CoV2373, the company’s COVID-19 vaccine. For one thing, Novavax delayed applying for emergency use authorization in several key markets until the end of 2021. It has also been dealing with a slow ramp-up of vaccine production. These concerns have helped send stocks more than 80% below their pandemic high.

On the other hand, Novavax appears to have a highly effective vaccine. Two large-scale clinical trials in adults last year produced vaccine efficacies of 89.7% (UK) and 90.4% (US and Mexico). A third trial published earlier this year in adolescents showed a vaccine efficacy of 80%. As one of the few drugmakers to reach the 90% vaccine efficacy mark, Novavax should have no problem becoming a major player in developed and emerging markets.

Additionally, Novavax has stayed true to its 2022 sales projection of $4 billion to $5 billion. If the company can meet this forecast, it will be valued at about 2 times Wall Street’s projected earnings this year. Considering it also has $1.57 billion in cash and cash equivalents, Novavax looks downright cheap.

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