Equities

Third Point Ups Amazon, Meta Stakes, Cuts Microsoft

Third Point and Viking Global shift big tech investments, with notable buys in Amazon, Meta, and Alphabet, and a sell-off in Microsoft.

By Alex P. Chase

5/16, 15:20 EDT
Amazon.com, Inc.
Clorox Company
DuPont de Nemours, Inc.
Dollar Tree, Inc.
Alphabet Inc.
Goldman Sachs Group, Inc.
Las Vegas Sands Corp.
McKesson Corporation
Meta Platforms, Inc.
Microsoft Corporation
Skechers U.S.A., Inc.
United States Steel Corporation
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Key Takeaway

  • Third Point increased stakes in Amazon, Meta, and initiated a $450M position in Alphabet; reduced Microsoft holdings despite its 12% Q1 gain.
  • Viking Global exited Alphabet, cut Meta significantly, and invested over $1.3B into Apple and Microsoft; boosted Amazon by 40%.
  • Both funds diversified beyond tech, with investments in sectors like finance and consumer goods, reflecting a shift towards stable big tech names.

Tech Sector Investments Surge

Dan Loeb's Third Point and Ole Andreas Halvorsen's Viking Global Investors have made significant moves in the technology sector during the first quarter of 2024, signaling a strong interest in big tech companies. Third Point notably increased its stakes in Amazon and Meta Platforms, while initiating a substantial new position in Alphabet, valued at over $450 million. This move positions Alphabet as Third Point's seventh-largest holding, reflecting a bullish outlook on the tech giant, which saw its stock climb over 8% in the first quarter and an additional 15% since April. Conversely, Third Point reduced its stake in Microsoft by more than 12%, despite the stock's nearly 12% gain in the first quarter.

Strategic Portfolio Adjustments

Viking Global Investors, on the other hand, executed a notable shift in its technology investments. The fund completely exited its position in Alphabet and significantly reduced its stake in Meta Platforms by approximately 75%. These funds were reallocated into new positions in Apple and Microsoft, with Viking Global purchasing millions of shares valued at over $1.3 billion combined. Additionally, Viking Global increased its Amazon holding by 40%, further emphasizing its confidence in selected big tech names despite exiting or reducing positions in others.

Diversification and Market Trends

Beyond the technology sector, both hedge funds have diversified their portfolios. Third Point opened stakes in companies like Goldman Sachs and Cinemark, moving away from previous investments in United States Steel, DuPont de Nemours, and McKesson. Viking Global also broadened its investment scope by initiating positions in non-tech companies such as Clorox, Dollar Tree, Skechers, and Las Vegas Sands. This diversification strategy reflects a broader market trend of shifting investor interest from thematic ETFs focused on disruptive technologies to more stable big tech companies, as evidenced by nearly $4 billion withdrawn from thematic ETFs in the current year.

Management Quotes

  • Dan Loeb, Third Point:

    "The New York-based hedge fund opened a stake valued at more than $450 million in Alphabet while building out positions in Amazon and Meta Platforms during the first three months of 2024... One caveat: he took some profit on Microsoft."