Get Premium to unlock powerful stock data

David Tepper's Top 5 Holdings as of 1st Quarter

The Appaloosa leader says 'stock market is still fine' after Fed announcement

Author's Avatar
James Li
Jun 17, 2021

Summary

  • Tepper said the Federal Reserve “did a good job” accelerating the interest rate hike timetable.
  • The Appaloosa founder still believes the stock market is still at acceptable levels.
  • The equity portfolio’s top holdings include Micron Technology and Amazon.com.
Article's Main Image

According to top 10 holdings statistics, a Premium feature of GuruFocus,

David Tepper (Trades, Portfolio)’s top five holdings as of the March-quarter filing are Micron Technology Inc. (MU, Financial), Amazon.com Inc. (AMZN, Financial), Facebook Inc. (FB, Financial), T-Mobile US Inc. (TMUS, Financial) and Alphabet Inc. (GOOGL, Financial)(GOOG, Financial). The Appaloosa Management leader told CNBC’s Scott Wapner on Thursday that the stock market remains at acceptable levels despite the Federal Reserve accelerating its interest rate hike timetable by one year.

Dow sinks as the Federal Reserve pushes up interest rate hikes one year earlier

The Dow Jones Industrial Average closed at 33,823.91, down 209.76 points from Wednesday’s close of 34,033.67 and 475.42 points from Tuesday’s close of 34,299.33.

1405538980279181312.png

Stocks sold off on Wednesday following the Fed’s announcement that it sees two interest rate hikes in 2023, overriding the Fed’s March announcement that it saw no interest rate hikes until at least 2024. The Fed also raised its inflation forecast to 3.4% for the year, approximately 1% higher than the Federal Open Market Committee’s projected rate in March. Despite this, Tepper believes that the Fed “did a good job” with the change in policy, showing that the policymakers were “not asleep at the wheel.”

1405545389922279424.png

Guru still believes the stock market is at acceptable levels

Despite the Fed’s announcement, Tepper still believes the stock market is “fine for now,” adding that the Fed will not begin tapering its quantitative easing bond buying program until later this year. The fund manager, who said in 2019 that he plans to convert Appaloosa into a family office, further said that the reduction in quantitative easing signals that the economy is in a good shape.

As of March 31, Appaloosa’s $6.96 billion equity portfolio contains 62 stocks, with 20 new positions and a turnover ratio of 14%. The top four sectors in terms of weight are communication services, consumer cyclical, technology and energy, representing 29.30%, 18.47%, 16.73% and 12.16% of the equity portfolio.

1405549106801238016.png

Micron Technology

Tepper’s firm owns 7.275 million shares of Micron Technology (

MU, Financial), giving the position 9.22% equity portfolio weight. Shares averaged $84.89 during the first quarter; the stock is significantly overvalued based on Thursday’s price-to-GF Value ratio of 1.53.

1405556634004054016.png

GuruFocus ranks the Boise, Idaho-based semiconductor company’s profitability 8 out of 10 on several positive investing signs, which include a high Piotroski F-score of 7, a 3.5-star business predictability rank and an operating margin that has increased over 20% per year on average over the past five years and is outperforming more than 70% of global competitors.

1405557963258683392.png

Gurus with large holdings in Micron include

PRIMECAP Management (Trades, Portfolio) and Li Lu (Trades, Portfolio)’s Himalaya Capital Management.

1405560288035561472.png

Amazon.com

Tepper’s firm owns 186,000 shares of Amazon.com (

AMZN, Financial), giving the position 8.26% weight in the equity portfolio. Shares averaged $3,171.97 during the first quarter; the stock is fairly valued based on Thursday’s price-to-GF Value ratio of 0.99.

1405561256932368384.png

GuruFocus ranks the Seattle-based e-commerce giant’s profitability 8 out of 10 on several positive investing signs, which include a five-star business predictability rank and profit margins and returns outperforming more than 76% of global competitors.

1405562873018671104.png

Gurus with large holdings in Amazon include

Baillie Gifford (Trades, Portfolio) and Ken Fisher (Trades, Portfolio)’s Fisher Investments.

1405563150090199040.png

Facebook

Appaloosa Management owns 1.82 million shares of Facebook (

FB, Financial), giving the position 7.70% weight in the equity portfolio. Shares averaged $269.28 during the first quarter; the stock is fairly valued based on Thursday’s price-to-GF Value ratio of 1.04.

1405567826076459008.png

GuruFocus ranks the Menlo Park, California-based social media giant’s profitability 10 out of 10 on several positive investing signs, which include a five-star business predictability rank, a high Piotroski F-score of 7 and operating margins that outperform over 94% of global competitors despite declining approximately 1.4% per year on average over the past five years.

1405592991409725440.png

T-Mobile US

Appaloosa owns 4.19 million shares of T-Mobile (

TMUS, Financial), giving the position 7.54% weight in the equity portfolio. Shares averaged $125.96 during the first quarter; the stock is significantly overvalued based on Thursday’s price-to-GF Value ratio of 1.54.

1405596675556335616.png

GuruFocus ranks the Bellevue, Washington-based telecom service company’s profitability 6 out of 10 on the back of three-year revenue and earnings growth rates outperforming more than 60% of global competitors despite profit margins and returns outperforming just over half of global telecom companies.

1405604194462818304.png

Alphabet

Appaloosa owns 231,000 Class C shares of Alphabet (

GOOG, Financial), giving the position 6.86% weight in the equity portfolio. Shares averaged $1,986.11 during the first quarter; the stock is significantly overvalued based on Thursday’s price-to-GF Value ratio of 1.35.

1405607445757255680.png

GuruFocus ranks the Mountain View, California-based online search giant’s profitability 9 out of 10 on several positive investing signs, which include a five-star business predictability rank and profit margins and returns outperforming more than 85% of global competitors.

1405611709338574848.png

Also check out:
Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.

Disclosures

I am/we are Long FB.
The mention of trades in this article reflect information as of the March-quarter portfolio filing and do not reflect any trades or hedges that Tepper's firm made during April to June.
Rating:
0 / 5 (0 votes)

Please Login to leave a comment

Author's Avatar