Billionaire hedge fund manager David Tepper’s bet on Meta Platforms Inc (NASDAQ:META) stock has paid off handsomely, with a remarkable 232% return since March 2016. Tepper, also the owner of the Carolina Panthers in the NFL, has been bullish on Meta stock since that time, and analysts continue to share his optimism.
Tepper’s firm, Appaloosa Management, initially invested in Meta stock during the first quarter of 2016 when the price was around $110. Fast forward to today, and the stock is trading at approximately $365, marking more than a three-fold increase in value. If one had invested $1,000 in Meta stock around the time Tepper expressed his confidence, it would have grown to approximately $3,320 today, representing an impressive 232% return. This translates to an annualized compound annual growth rate (CAGR) of 20%.
In September 2023, Tepper further displayed his confidence in Meta by doubling down on his investment, increasing its weight in his portfolio to just over 8%. This move likely reflects the strong momentum Meta has experienced in the AI sector throughout 2023.
Over the past year alone, Meta stock has soared by an impressive 172%. However, investors are now questioning whether there is any upside remaining for the stock, given its high valuation. Nevertheless, analysts maintain a positive outlook for Meta, citing its competitive advantage in artificial intelligence (AI) and its best-in-class profitability.
Consensus estimates suggest that Meta remains a compelling buy for investors seeking growth. The company’s forward valuations are seen as normalized, thanks to the promising return of advertising spend, optimized operations, and a profitable growth trend.
Analysts who recently reviewed Meta have even raised their price targets for the stock, underscoring their confidence in its future performance. The upward trajectory and potential of Meta in the AI sector continue to garner attention and interest from investors.
In conclusion, David Tepper’s bet on Meta stock has proven to be incredibly lucrative, with a remarkable 232% return since March 2016. The stock’s impressive performance, combined with its AI advantages and profitability, has led analysts to remain bullish on its future prospects. As Meta continues to make strides in the AI industry, the company appears to be well-positioned for sustained growth.
