Latest news with #StephenYiu
CNBC
28-04-2025
- Business
- CNBC
Fund manager owns just one Mag 7 stock after dumping Meta stake: ‘You have to pick the stock you really believe in'
Nvidia is in — and Meta is out. That's according to Stephen Yiu, co-founder and lead fund manager of London's Blue Whale Growth Fund. The fund held 29 stocks as of the end of March this year, with top holdings including Apollo , Nvidia, Broadcom and TSMC , and more than a third of its investments are in the technology sector. It employs a long-only strategy and has returned 139% since its inception in 2017, significantly outperforming the IA Global Sector average. Over the year-to-date, however, it's down 9.6% amid a broad slowdown in the tech sector. Selling Meta Speaking to CNBC's "Squawk Box Europe" on Monday, Yiu said the fund had exited its position in Meta – one of only two so-called "Magnificent 7" it owned, alongside Nvidia. Of those seven megacap stocks – Meta, Tesla , Nvidia, Alphabet , Microsoft , Apple and Amazon – Meta has sustained the smallest losses since the beginning of the year, losing around 6.5% of its value. "We do like the AI story on the back of Meta's user base of 3 billion users across Facebook, Instagram and WhatsApp," Yiu said on Monday. However, he argued that Meta's business model made the company particularly susceptible to the impacts of a U.S. or global slowdown, which was looking more likely amid mounting trade tensions. "A U.S. recession is going to impact the top line of the business, which is still 100% … digital advertising," he explained. For the Blue Whale fund, Yiu said the Meta exit was an "unusual" move. "Currently we're running just over 5% in cash on the back of the exit on Meta," he said, noting that usually, the fund's cash holding would be "close to zero." "This is a long-only strategy, so we'd normally be quite fully invested," he added. "Ultimately, the reason we don't own the Mag 7 outside Nvidia is because ... their return on investment capital profile is coming down." Retreat from discretionary goods The Blue Whale fund also downsized some of its other investments alongside cashing out of Meta, Yiu said. "We've also reduced some of our holdings, like in Nintendo , in luxury and some others that we think are going to see a bit of impact … the world stock market over a few weeks ago was down over 20%, I think people are going to [rethink] whether they're going to buy a new ski jacket from Moncler next ski season." In a note to clients last week, Yiu said the Nintendo Switch 2's $449.99 price tag combined with tariff uncertainty "raises questions about future demand." Shares of Nintendo rose after the console was announced — a reaction Yiu said the Blue Whale fund "took advantage of … to lower our exposure." Nvidia bull Reiterating a broad optimism toward AI, Yiu said the fund's management team preferred companies "on the receiving end of any spending." As such, Yiu and his team are bullish on chipmaker Nvidia, despite the company's stock shedding around 17% so far this year. "If you look at the Mag 6 outside of Nvidia that are spending over $300 billion [on AI], I would probably say about half of that will be going to Broadcom or Nvidia, which makes the company very profitable with free cash flow," Yiu said. He acknowledged that many market watchers had argued Nvidia is "a difficult stock to own now" as it has been caught up in the conversation around tariffs and international trade negotiations. However, Yiu argued that "you have to pick the stock that you really believe in long term, and you might need to ride out the volatility in between." Outside of the tech space, Yiu noted that other companies in the flagship Blue Whale fund's portfolio had reported "strong results" amid market volatility. Among them were life sciences firms Sartorius and Danaher , tobacco giant Philip Morris , semiconductor machinery maker Lam Research , and medical supplies manufacturer Biologix.
Yahoo
19-04-2025
- Business
- Yahoo
Billionaire fund manager makes bold bets on Meta, Nvidia stock
It's been a rough go for tech stocks so far in 2025. The Magnificent 7's stellar returns over the past two years fueled big gains in the broader S&P 500 index, but mounting worries that a global slowdown could crimp corporate budgets have been a headwind this year. The S&P 500 has fallen 10% year-to-date in 2025, mainly because tech stocks, representing over 30% of the index, have tumbled. The pain has been widespread across tech-land, with large technology leaders like Nvidia and Meta Platforms being particularly hard hit, dropping 24% and 14%, sell-off in technology stocks has caught the attention of global investors, including Stephen Yiu, who manages money for billionaire Peter Hargreaves, founder of U.K. financial services giant Hargreaves Lansdown. Yiu's Blue Whale hedge fund is particularly dialed into technology, given that about 40% of the fund's roughly $1.5 billion in assets are invested in the sector. The hedge fund's size and tech-stock focus make Yiu's moves, including his latest bets on what will happen to Nvidia and Meta Platforms stock next, worth watching. The technology industry has been a big beneficiary of a flood of investment into artificial intelligence. After OpenAI's ChatGPT became the fastest app to reach one million users when it was launched in 2022, companies poured massive sums into developing their own large language model AI chatbots and agentic AI flurry of AI interest has correspondingly encouraged a staggering overhaul of enterprise and cloud network data centers. Capital expenditures by hyperscalers like Amazon, Microsoft () , and Google have skyrocketed, reaching $192 billion in 2024. Meta Platforms () alone spent $39 billion last year, up from 27 billion in 2023. The buildout has been a boon for Nvidia, given that its graphics processing units (GPUs) are far better suited to handling the massive compute power required for training and running AI programs than the central processing units (CPUs) most commonly found in network servers. Nvidia's () revenue has surged since 2022 because of demand for its H100, H200, and Blackwell chips. It reached $130 billion in fiscal 2025, up an eye-watering 114% in 2024 alone. Hyperscalers' spending on Nvidia chips has largely been financed by cloud customers' rising spending on AI research and strength in other business segments. For instance, Meta Platforms' advertising revenue led to its Family of Apps (Facebook, Instagram, WhatsApp, etc.) revenue growing 21% year-over-year in the fourth quarter to $47.3 billion, as businesses capitalized on strong consumer spending. The tailwinds supporting spending, however, are fading. Unemployment has risen, and sticky inflation continues to weigh on consumer spending decisions. Consumer sentiment has plummeted recently amid a mounting trade war that could cause GDP to decline even as inflation increases, putting the U.S. at risk of stagflation or recession. The potential fallout from slowing GDP growth could mean technology companies rethink their CapEx plans, shelving previously planned projects while they wait for greater clarity. The risk that the tech sector faces a major reset in 2025 isn't lost on Yiu, given his recent moves include selling Meta Platforms and Microsoft unloaded Meta Platforms and Microsoft stock earlier this month after President Trump announced reciprocal tariff plans on April 2, reports the Financial Times. Those tariffs are designed to encourage a return of manufacturing to the U.S.; however, proposed import taxes were higher than economists and Wall Street expected, causing investors to lower growth expectations and triggering the stock market's sell-off. His decision to sell Meta Platforms, a holding since 2023 representing about 3% of his fund's assets, is rooted in the risk that ad revenue could fall sharply. "When you have a global business in digital advertising and a global slowdown and economic uncertainty, then it does impact the top line,' said Yiu regarding the risk to Meta Platform's ad sales. More Tech Stocks: Top analyst revisits Tesla stock price target as Q1 earnings loom Google's Waymo is planning a move that's downright creepy Analyst reboots Apple stock price target after tariff meltdown Yiu also hit the sell button on Microsoft, another big holding, after determining that its AI spending could exceed cash flow. Perhaps surprisingly, while Yiu has soured on Meta and Microsoft, he's bullish on Nvidia. He told the Financial Times he's been buying as Nvidia's stock price has been falling, increasing his position in the semiconductor Goliath to 10% of assets from 7% previously. Although Nvidia will take a $5.5 billion charge following new restrictions on selling its popular H20 AI chip in China, Yiu thinks Nvidia is positioned to continue to do well over time amid the ongoing race for AI dominance.
Miami Herald
19-04-2025
- Business
- Miami Herald
Billionaire fund manager makes bold bets on Meta, Nvidia stock
It's been a rough go for tech stocks so far in 2025. The Magnificent 7's stellar returns over the past two years fueled big gains in the broader S&P 500 index, but mounting worries that a global slowdown could crimp corporate budgets have been a headwind this year. The S&P 500 has fallen 10% year-to-date in 2025, mainly because tech stocks, representing over 30% of the index, have tumbled. The pain has been widespread across tech-land, with large technology leaders like Nvidia and Meta Platforms being particularly hard hit, dropping 24% and 14%, respectively. Related: Surprising trade war news sends Nvidia stock reeling The sell-off in technology stocks has caught the attention of global investors, including Stephen Yiu, who manages money for billionaire Peter Hargreaves, founder of U.K. financial services giant Hargreaves Lansdown. Yiu's Blue Whale hedge fund is particularly dialed into technology, given that about 40% of the fund's roughly $1.5 billion in assets are invested in the sector. The hedge fund's size and tech-stock focus make Yiu's moves, including his latest bets on what will happen to Nvidia and Meta Platforms stock next, worth watching. The technology industry has been a big beneficiary of a flood of investment into artificial intelligence. After OpenAI's ChatGPT became the fastest app to reach one million users when it was launched in 2022, companies poured massive sums into developing their own large language model AI chatbots and agentic AI programs. Related: Analyst unveils surprising AMD stock price target after chip export curb The flurry of AI interest has correspondingly encouraged a staggering overhaul of enterprise and cloud network data centers. Capital expenditures by hyperscalers like Amazon, Microsoft (MSFT) , and Google have skyrocketed, reaching $192 billion in 2024. Meta Platforms (META) alone spent $39 billion last year, up from 27 billion in 2023. The buildout has been a boon for Nvidia, given that its graphics processing units (GPUs) are far better suited to handling the massive compute power required for training and running AI programs than the central processing units (CPUs) most commonly found in network servers. Nvidia's (NVDA) revenue has surged since 2022 because of demand for its H100, H200, and Blackwell chips. It reached $130 billion in fiscal 2025, up an eye-watering 114% in 2024 alone. Hyperscalers' spending on Nvidia chips has largely been financed by cloud customers' rising spending on AI research and strength in other business segments. For instance, Meta Platforms' advertising revenue led to its Family of Apps (Facebook, Instagram, WhatsApp, etc.) revenue growing 21% year-over-year in the fourth quarter to $47.3 billion, as businesses capitalized on strong consumer spending. The tailwinds supporting spending, however, are fading. Unemployment has risen, and sticky inflation continues to weigh on consumer spending decisions. Consumer sentiment has plummeted recently amid a mounting trade war that could cause GDP to decline even as inflation increases, putting the U.S. at risk of stagflation or recession. The potential fallout from slowing GDP growth could mean technology companies rethink their CapEx plans, shelving previously planned projects while they wait for greater clarity. The risk that the tech sector faces a major reset in 2025 isn't lost on Yiu, given his recent moves include selling Meta Platforms and Microsoft shares. Related: Veteran fund manager resets Nvidia stock price target after shocking export news Yiu unloaded Meta Platforms and Microsoft stock earlier this month after President Trump announced reciprocal tariff plans on April 2, reports the Financial Times. Those tariffs are designed to encourage a return of manufacturing to the U.S.; however, proposed import taxes were higher than economists and Wall Street expected, causing investors to lower growth expectations and triggering the stock market's sell-off. His decision to sell Meta Platforms, a holding since 2023 representing about 3% of his fund's assets, is rooted in the risk that ad revenue could fall sharply. "When you have a global business in digital advertising and a global slowdown and economic uncertainty, then it does impact the top line," said Yiu regarding the risk to Meta Platform's ad sales. More Tech Stocks: Top analyst revisits Tesla stock price target as Q1 earnings loomGoogle's Waymo is planning a move that's downright creepyAnalyst reboots Apple stock price target after tariff meltdown Yiu also hit the sell button on Microsoft, another big holding, after determining that its AI spending could exceed cash flow. Perhaps surprisingly, while Yiu has soured on Meta and Microsoft, he's bullish on Nvidia. He told the Financial Times he's been buying as Nvidia's stock price has been falling, increasing his position in the semiconductor Goliath to 10% of assets from 7% previously. Although Nvidia will take a $5.5 billion charge following new restrictions on selling its popular H20 AI chip in China, Yiu thinks Nvidia is positioned to continue to do well over time amid the ongoing race for AI dominance. Related: Veteran fund manager unveils eye-popping S&P 500 forecast The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Bloomberg
28-01-2025
- Business
- Bloomberg
DeepSeek ‘Started a Revolution' for AI and Investors
Blue Whale Manager Stephen Yiu joins Merryn Talks Money to discuss the Big Tech selloff, his outlook for AI and where he's investing now. Subscribe to Merryn Talks Money on Apple Podcasts The artificial intelligence landscape appears to have changed. Nvidia's dominance has been disrupted by Chinese startup DeepSeek, whose surge in popularity is raising questions about the valuations of US tech giants. That this new rival to ChatGPT comes at a fraction of the latter's cost has poked holes in the justification for massive AI budgets. 'They have started a revolution,' says Stephen Yiu, chief investment officer of Blue Whale Growth Fund, who joins this week's Merryn Talks Money. Now anyone 'can start to work on some AI application.'
