YTread Logo
YTread Logo

Top 5 Stocks the Smart Money is Buying in the 2022 Crash

Mar 10, 2024
Wouldn't it be great if every quarter we, as average investors, could look inside the minds of the world's best investors and see what they're

buying

? Ta-da, we can, the power of the 13-f filing only catches The information is hidden from the public for 45 days, so unfortunately we are always looking to the past, so it is a little annoying, but hey, if that means that I can see what all my favorite investors are

buying

or selling each quarter, I'll take it. As you know, there is a very useful website that I use called data roamer that actually tracks 79 super investors and compiles a list of the most bought

stocks

each quarter, so in this video let's talk about the five most bought

stocks

for the

money

smart

in second quarter of

2022

and I know that technically this video will be coming out quite late and I apologize because it is due to a combination of factors.
top 5 stocks the smart money is buying in the 2022 crash
We've had other videos to finish. We're also hiring right now, so it's kind of our usual routine. messy and I actually just got back from abroad too, but as we'll see this time, it doesn't really matter that much that the video is late because the stock prices of many of these companies haven't really moved much since the end of the second quarter , but with that being said, let's get into it, take a look at the five most bought stocks by our super investors last quarter. I said the top five in the title, but I also want to take a look at the rest of the top 10. because there are definitely some interesting names this time, so let's do that first and then we'll spend a little more time on the top five, so first up at number 10 is Adobe, so the creators of various pieces of software, already You know, Photoshop and Premiere Pro and After Effects etc are a very solid moat company, they obviously have a switch mode, much to my personal frustration as we use their programs all the time here in the office and honestly they suck , but obviously, it's a good thing to keep your profits high as a business overall, seven super investors bought adobe as the stock fell 20 in the second quarter, so there was a pretty big drop and then we hit number nine, we got ourselves bancorp, I can't really add anything. flavor when it comes to banks, that's not my circle of competence, but this one is in the hands of Warren Buffett and Charlie Munger again, seven super investors brought in in the second quarter when the stock fell 13 in the corner and then hit number eight , we suppose. what netflix again seven super investors buying so another strong moat company yes i said it it's interesting because the headlines this quarter were a lot like oh disney and it gained a ton of subscribers netflix is ​​losing subscribers but when you really dig underneath From the surface we find that Netflix is ​​by far the dominant streaming service, their percentage of screen time is much higher than any of the other players and they are also overtaking YouTube and obviously they rake in a lot more revenue per subscriber than the other streaming services, so if you combine that with the fact that the stock price plummeted to 53 in the second quarter, that's a recipe for super investors to get very interested and then, Coming to number seven, we have PayPal, this time eight super investors decided to buy and again this is Another strong company, they have a very strong network of users which has given them an approximate 50% share in the payment processing market online.
top 5 stocks the smart money is buying in the 2022 crash

More Interesting Facts About,

top 5 stocks the smart money is buying in the 2022 crash...

The stock also lost about 40 percent in the second quarter, so I'm definitely not surprised to see super investors taking interest. then coming to number six, we have bookings, so again eight of our super investors bought bookings, which is a collection of travel related businesses including booking.com and priceline.com, kayak, agoda, rentingcars.com and opentable , like all travel businesses. They suffered badly in 2020 and 2021, but are now truly recovering and with the stock rebounding in the second quarter, it appears that eight super investors saw value at some point during the quarter. Now we're into the top five, so we're really moving forward quickly. top five, but I want to spend a little more time on the five biggest buys in Q2, so coming to number five, we have Disney again as a big moat company, so 10 super investors decided to buy Disney after the stock price fell 31. in the second quarter and I think what super investors see here is simply poor long-term pricing because while their profits are still a long way from returning to where they were before 2020, operationally investors have had much more reason to be optimistic.
top 5 stocks the smart money is buying in the 2022 crash
In recent months, for example, first of all, more and more people are returning to their parks, so ticket revenue has doubled year over year, causing a large increase in operating income for the experiences and products of its parks, from 356 million and q21 to 2,200 million in the second quarter of this year. year and this even led their CEO, Bob Chapeck, to hint that demand is now strong enough that they can start raising their prices at their parks, which is a very good sign for that segment; On top of that, we also saw a 15x increase in operating income. of their domestic broadcast and cable businesses, so they are two critical businesses from a current financial perspective, as their parks and then their broadcast and cable are doing well and beyond, we also have good news from their broadcast efforts, so that 15 million new disney plus subscribers and interestingly price increases are coming now, if you look at the financials this segment is definitely still not nice, direct to consumer operating loss went from millions to over billion year after year, but remember that up to this point disney plus has been focused on deliberately undercutting netflix to attract as many subscribers and therefore market share as possible, so they are being deliberately beaten, so what they tell us price increases is that the management team now believes that they have reached that critical mass or market share of now 150 million subscribers and can now focus on increasing the average revenue per user so that their streaming efforts are positive, that is what that's happening at Disney and like I said, with the stock down 31 in the second quarter, I think it's attracted a lot of these long-term super investors, if we just focus on Wall Street, their built-in discounted cash flow analysis suggests the stock could be quite undervalued at the current price, if we focus on the long term it will never be a 10 20 30 bagger, but for a lot of these super investors I think they are just betting on healthy long term returns so Disney now moves to number four, we have Microsoft, another big moat company, Microsoft of course has a very strong position. and diversified switching mode which is the result of all of their software, just take a look at all of their different software products and services, a lot of them as you can see, and pretty steady growth in all areas, particularly their offerings cloud so again we saw 10 super investors buy microsoft in the second quarter when the stock fell 17 over the quarter so once again I think this is another case of super investors just taking full advantage of the sell off in the market to buy a high quality business, that is, just take a look at the last five years of revenue earnings per share capital and free cash flow growth which is very healthy growth look at the last five years the performance of the Capital management of investors is an average of 24 obtained 104 billion cash or short-term investments total debt of only 50 billion so they are definitely not going anywhere debt to equity of only 0.4 is quite easy to To say that at a glance Microsoft is a well-oiled machine and going back to simply Wall Street they have a current valuation score of five out of six with the total -significant discounted cash flow suggesting a reasonable discount now, of course, that doesn't mean that You may need to go out and buy it immediately without doing your own due diligence, however, it allows you to understand why super investors didn't hesitate to load up. rose during the second quarter, but with that said, let's now move on to the third most bought stock in the second quarter and that was Amazon. 15 of our super investors bought Amazon in the second quarter and again we see a similar story: a very strong moat company whose shares were beaten.
top 5 stocks the smart money is buying in the 2022 crash
However, this time in the second quarter the beating was a little more understandable, as if we look back at its first quarter earnings, the company showed year-over-year revenue growth of just seven percent, which is the fastest growth rate. slow for any quarter since the dotcom bus in 2001. The stock price lost about 27 in two weeks and investors were really worried that macroeconomic conditions were hindering the average consumer's willingness to spend and don't get me wrong, that could be the case, as again in the second quarter revenue only grew. Seven percent year over year with online retail spending flat quarter over quarter really shows how much a stock can jump when investors fear the near-term macro scenario, but of course, that's exactly what gives investors long term the opportunities we have.
They don't care about macro, so it's not surprising to see these big super investors, these value investors jump back in and just turn to Wall Street. They show an estimated undervaluation based on their discounted cash flow analysis, however, it's not very convincing as they only score three out of six overall on their overall valuation score, okay, and then there were two and see if you can guess what these two are before we reveal them. I think you can probably guess what they are. Big names have been missing from this list so far, but getting to number two is of course interesting goal, it was bought by 17 of our super investors in the second quarter, the share price fell by about 30 and even here today the stock hasn't really recovered at all, who would have thought a few years ago that we would see Facebook with a PE of only 13?
Well, here we are and this is due to a few reasons, firstly, Apple and Google have clamped down on data tracking for advertising and there are the macroeconomic conditions that affect the budgets of large advertisers and also a large investment in the development of the metaverse, which is a project that will leave a hole in Meadows' finances for many years to come, in the second quarter alone, meta suffered a loss of 2.8 billion from its reality. labs, so it's not insignificant, but what's really giving investors chills right now is that the advertising business is responsible for basically all of Meadows' revenue, and right now, with economic conditions tightening , investors are worried that large advertising target customers.
They are going to reduce their spending and target will recently suffer target they themselves forecast a continuation of the weak advertising demand environment that we experienced during the second quarter which they believe is being driven by broader macroeconomic uncertainty, but here's the thing and that's why meta is right at the top of this list, you know if you're a long-term investor who cares, why would you be stressed about the macroeconomic environment over the next year or two? The answer is, of course, that you should not fail to remember the vast majority of

money

. in the market is focused on the short term, that's exactly how we as long term investors get these big mispricings on solid businesses, it's just that short term money worries because if you take a look at meta , have a very solid growth track record.
I have a very solid roic history, but also 12.7 billion in cash, 28 billion in short-term securities, and zero long-term debt. I mean, it's hard to get in trouble when you have cash and you don't owe anyone anything. so it doesn't surprise me that super investors have in this case gotten a valuation score of five out of six simply from Wall Street and a huge margin of safety in their discounted cash flow analysis as well and with that being said, that brings us to the number one. Drum roll please, the number one most bought stock by our super investors in the second quarter of

2022

was Google.
A whopping 24 of our 79 super investors bought Alphabet in one form or another in the second quarter in total, 16 super investors bought class a shares and 13 bought class c shares. Obviously, some bought both,So what is the difference in share class? Well, they're pretty much the same thing, except class A shares have voting rights and class C shares don't, but either way super investors were very interested in Alphabet last quarter, including the only Lee liu for those who don't know lee liu is the guy standing here next to this distinguished gentleman oh wait that's me it was pretty crazy this is a photo from the Berkshire Hathaway shareholders meeting we attended earlier in the year where I was in a seat on the island, then there was the aisle and literally directly across the aisle from me, Li Liu, could have reached out and high-fived the guy, which was pretty impressive, anyway, enough about me.
Go back to Google, he got hit too. the queue to sell goes down 22 but seriously, if you are an institutional investor, I have a hard time understanding why you would sell this stock during a recession. This company probably has the best financials I've seen for a publicly traded stock. The economy could literally. fall off a cliff and Google would be fine, I mean look at these stats: average revenue growth over the last five years 24 earnings per share 46 equity 13 free cash flow 24 the average return on equity of investors 18 have 125 thousand million in cash or short term investments and they have only 15 billion in debt, they have a debt to equity ratio of 0.1, it doesn't get any better than that, so yes, this business is very strong, it is growing its profits of the second quarter.
They noted that despite the macroeconomy they are seeing an increase in ad spending by large advertisers, which is good, they delivered six percent more impressions during the second quarter. The cost per impression increased by two percent, so really all that happened was that the shares sold off with the rest of the market, but as we can. see on Simply Wall Street Google now also scores a six out of six valuation score with discounted cash flow analysis showing a pretty solid margin of safety and I think when you look at the big picture, super investors thought it was a deal decent and by the way if you would like to just try Wall Street there is a link in the description of this video it's free to use forever or if you want to sign up for a premium account and get full access I've been using to do this video, then you can get a 30% discount by using that link, but overall, team, these are the 10 most bought stocks by our super investors in the second quarter of 2022.
Sorry, the video is a little later than expected. usual, however, as you can see in many of these stock charts, many of these stock prices have actually gone down. Not much has changed from the end of Q2 until now, so it doesn't really affect the validity of this video much. I hope you still enjoyed it. If you like watching these videos, let me know with a like. I would greatly appreciate it. If you want to see more of these videos be sure to subscribe, but other than that guys thanks for watching and I'll see you all in the next video.

If you have any copyright issue, please Contact