We recently published a list of Philippe Laffont Stock Portfolio: Top 10 Stock Picks. In this article, we are going to take a look at where GE Vernova Inc. (NYSE:GEV) stands against other stocks of Philippe Laffont's Stock Portfolio.
Founded by Philippe Laffont, Coatue Management is a lifecycle investment platform that is focused on turning big ideas into world-shaping technology companies. Laffont established Coatue Management in 1999 and has earlier gained experience as a “Tiger Cub” while working at Julian Robertson’s Tiger Management hedge fund. The company makes investments across public and private markets and has a focus on technology, media, consumer, telecommunications and healthcare sectors. The company’s lifecycle investment platform expanded across venture, growth, thematic, and structured capital strategies.
Coatue’s Investment Approach
The company’s investment philosophy revolves around a technology-centric approach. This approach stems from the belief that technological innovation is the key factor fueling economic growth and it possesses the potential to disrupt traditional sectors. As investors, the company tends to focus on seeking out the greatest innovators with the biggest ideas. The company has recently announced its continued deep partnership with Norm Ai by leading the latest investment. Norm Ai focuses on enabling regulated businesses to reap the benefits of the GenAI, with their government-grade regulatory AI product. Overall, the mission is to enable companies to do more, and yet maintain robust compliance scrutiny.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
Industrial Base is Expected to Transform, says Coatue
As per Coatue, for the much of 20th century, the defense sector was responsible for technological breakthroughs – from the internet to GPS. However, in recent decades, its role as a key driver of innovation has diminished. That being said, the investment management firm said that the US industrial base is at a pivotal moment. A wave of innovation has been emerging, fueled by new government initiatives, groundbreaking technologies, and an urgent need for modernization. The defense sector, which was once a sector not suitable for startups and innovators, is now opening. The firm believes that organizations and instruments, such as the Defense Innovation Unit (DIU) and Other Transaction Authorities (OTA), continue to accelerate the pace of partnerships between the government and private companies.
The disruptors believe that even the most entrenched systems could be transformed with the help of innovation, placing new standards for agility, cost-efficiency, and impact, says the investment firm. Overall, it expects the industrial base of the future to revolve around unmanned/autonomous systems, nuclear-powered energy, robotic manufacturing, and a completely new space economy.
Amidst these trends, we will now have a look at the Philippe Laffont Stock Portfolio: Top 10 Stock Picks.
Our Methodology
To list the Philippe Laffont Stock Portfolio: Top 10 Stock Picks, we selected the top 10 stocks in Coatue Management’s portfolio as per its Q4 2024 13F filing. We settled on the hedge fund’s 10 biggest holdings. Finally, we ranked the stocks in ascending order based on the value of Coatue Management’s equity stakes. Additionally, we have mentioned the hedge fund sentiment around each stock, as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
GE Vernova Inc. (NYSE:GEV)
Coatue Management’s Stake Value: $1.27 billion
Number of Hedge Fund Holders: 111
GE Vernova Inc. (NYSE:GEV) is an energy company that provides various products and services that generate, transfer, orchestrate, convert, and store electricity. Fitch Ratings believes that the company’s extensive installed base, primarily in gas power, garners significant high-margin services revenue. It continues to streamline the cost structure and focus on R&D. The firm also believes that investments in energy infrastructure in GE Vernova Inc. (NYSE:GEV)’s European and US markets continue to increase because of higher energy usage and adjustments to the electrical grid as intermittent renewable energy sources connect to the transmission system.
GE Vernova Inc. (NYSE:GEV)’s healthy market position in gas power and grid equipment offers a strong foundation for long-term growth. Its expertise in such areas remains in line with the ongoing energy transition and the requirement for reliable baseload power. With countries seeking to balance renewable energy integration with grid stability, GE Vernova Inc. (NYSE:GEV)’s gas power solutions can play a critical role in offering flexible and efficient power generation. Also, the expected super-cycle in gas power can significantly fuel the company’s revenues and market share.
Fidelity Investments, an investment management company, recently released its Q3 2024 investor letter. Here is what the fund said:
“Among individual holdings, the top relative contributor was an overweight stake in GE Vernova Inc. (NYSE:GEV). The company’s shares gained about 49% the past three months, as the power-generation business that split from General Electric on April 2 continued to fare well as a stand-alone entity. On July 24, the company reported quarterly earnings that were better than expected, boosted by its natural gas power-turbine business, and released an optimistic financial forecast for the rest of 2024.”
Overall, GEV ranks 8th on our list of top 10 stock picks of Philippe Laffont's stock portfolio. While we acknowledge the potential of GEV as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued AI stock that is more promising than GEV but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires
Disclosure: None. This article is originally published at Insider Monkey.
Comments