Investment management firm Davis Advisers has released its 2022 annual investor letter, Davis New York Venture Fund. A copy of it can be downloaded here. The fund’s portfolio of long-lived companies now trades at 9.8 times forward earnings, compared to 17.8 times for the S&P 500 Index. The Company believes that the Fund’s holdings have significant earnings prospects over the coming years. Also, check out the fund’s top five holdings for its top picks in 2022.
The Davis New York Venture Fund highlighted stocks like Meta Platforms, Inc. (NASDAQ:META) in its 2022 annual letter to investors. Meta Platforms, Inc. (NASDAQ:META), headquartered in Menlo Park, California, is a technology company that creates products to connect people. On March 20, 2023, Meta Platforms, Inc. (NASDAQ:META) stock closed at $197.81 per share. Meta Platforms, Inc. (NASDAQ:META)’s one-month yield was 14.95% and its shares are down 8.70% over the past 52 weeks. Meta Platforms, Inc. (NASDAQ:META) has a market capitalization of $512.85 billion.
The Davis New York Venture Fund made the following comment on Meta Platforms, Inc. (NASDAQ:META) in its 2022 Annual Investor Letter:
“As both a ‘blue chip of tomorrow’ and a company suffering from ‘headline risk’, our investment in Meta Platforms, Inc. (NASDAQ:META) reflects both of these investment themes. With more than three billion daily users across its three platforms (Facebook, Instagram, and WhatsApp), Meta has more users than almost any other company in history. Despite this success, Meta currently suffers from a cloud of skepticism over two issues: competition from other services like TikTok; and significantly increased spending on both artificial intelligence (AI) and speculative new ventures, including virtual reality and augmented reality (often referred to as the metaverse).
Starting with the competition, despite the drumbeat of negative headlines leading most investors to believe that Facebook’s core business is shrinking, Figure 9 shows continued growth in the number of users of their core service, including Facebook (green bars), as well as the entire family of applications the company.
The gold line in Figure 9 shows that Meta’s ad revenue per user is up more than 30% since 2019, but below last year’s peak. While we find this drop worrying, it’s hardly surprising given the slowing economy and the time it’s taking Facebook to adapt to the changes Apple made – somewhat disingenuous in the name of privacy – that reduced the effectiveness of some of Meta’s advertising , while Apple was preferred. We highlight this drop as a risk but believe it will prove temporary. We believe that Meta’s growing user base, as well as the continued increase in the amount of time users spend on those platforms, is a far more important indicator of Meta’s relevance and value…” (Click here for full text .)
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Meta Platforms, Inc. (NASDAQ:META) is ranked #4 on our list of the top 30 most popular hedge fund stocks. According to our database, 194 hedge fund portfolios held Meta Platforms, Inc. (NASDAQ:META) at the end of the fourth quarter, up from 177 in the previous quarter.
We talked about Meta Platforms, Inc. (NASDAQ:META) in another article and shared Broyhill Asset Management’s views on the company. For more investor letters from hedge funds and other leading investors, visit our Hedge Fund Investor Letters Q4 2022 page.
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Disclosure: None. This article was originally published on Insider Monkey.
