15 Nov Dan Loeb sold chip stocks last quarter. Where he went instead
Dan Loeb’s Third Point hedge fund took profits on a handful of chip stocks in the third quarter, instead buying into other, marquee technology names, regulatory fillings show. The New York-based hedge fund zeroed out positions in semiconductor makers Advanced Micro Devices , Micron Technology and Nvidia , according to Third Point’s 13F filling with the Securities and Exchange Commission. On the other hand, he built a $330 million position in Meta Platforms and bulked up his Microsoft stake during the latest three-month period. Wall Street has closely-watched Loeb following a Wall Street Journal report in September that found Third Point grappling with an exodus of assets due to underperformance. The Journal reported, citing sources familiar, that investors requested withdrawals at the end of September that equated to around $850 million, or more than 7% of the firm’s assets. While contending with these challenges in the third quarter, the billionaire fund manager sold of his holdings in the three chip stocks. It comes during a strong year for the sector, even including the third-quarter slump in the market. Despite a pullback of nearly 5% in the third quarter, the VanEck Semiconductor ETF (SMH) is still up nearly 60% in 2023 and hit an all-time high Tuesday. Those gains have come amid the artificial intelligence boom that has driven up chip makers and other stocks tied to the technology. Loeb is far from abandoning big tech stocks. The 61-year-old California native built a 1.1-million share position in Meta, making it Third Point’s sixth largest holding, according to InsiderScore. The Facebook and Instagram parent was able to avoid the market retreat in the third quarter, posting a 4.6% return. Shares are higher by 175% so far in 2023, compared to the S & P 500 and Nasdaq Composite ‘s returns of 17% and 35%, respectively. And Loeb’s move is already paying off, with Meta shares climbing more than 10% in the fourth quarter. In the same vein, Loeb raised the size of his Microsoft stake by 46% in the third quarter. With the increase, Microsoft was the second largest holding in the fund, valued at more than $700 million, behind only electric and gas utility PG & E , worth more than $900 million, according to InsiderScore data. Microsoft has had a similarly strong 2023. Despite giving up some gains in the third quarter, when it fell 7%, the Xbox and Windows parent is higher by 54% so far in 2023. The stock is rebounding from a down third quarter, surging almost 17% since the end of September. Loeb also expanded his holding in Amazon in the third quarter, boosting the position by more than 14% to almost $600 million, making it the fourth-largest. Elsewhere, he made significant increases to Intercontinental Exchange and Jacobs Solutions . Loeb, who launched Third Point in 1995 after a career at Warburg Pincus, Jefferies and Citigroup, pulled back on a handful of positions, including Taiwan Semiconductor and DuPont de Nemours . In addition to the chip makers, Leob also sold out his entire stakes in HCA Healthcare and Black Knight , among others.