While inflation and higher rates keep hitting the valuation of tech companies in the US, asset managers are looking to buy their favorite companies at a discount since the Nasdaq is down over 30% year-to-date (YTD).
DNB Asset Management AS, a unit of Norway’s largest financial-services firm DNB, and one of the larger European asset management firms, revealed interesting acquisitions for Q3 through their 13F filing.
The three biggest assets that DNB added to its $82 billion asset portfolio during the third quarter are listed below, along with an in-depth chart and technical analysis of each company by Finbold.
Alphabet Inc (NASDAQ: GOOG)
DNB added over 4.4 million shares of GOOG, making it one of the largest holdings in its portfolio. With the biggest share in the search market and Google cloud competitiveness, the US tech giant would make sense for a long-term investment for the asset manager.
On October 21, news of Google investing $200 million in an AI startup Cohere Inc. surfaced, showing that Google is looking to stay at the forefront of technology despite a difficult investing environment and the US possibly looking down a barrel of inflation.
Technical analysis indicates a support zone from $96.15 to $96.46 and a resistance line at $101.49. GOOG shares are down 30% YTD, and over the past month, the shares traded from $95.27 to $104.22, mostly staying around the 20-day moving average.
Wall Street analysts rate Google stock a ‘strong buy,’ with the average price in the next 12 months reaching $140.57, 38.52% higher than the current trading price of $101.48. Notably, out of 7 Wall Street analysts, all 7 have a ‘buy’ rating.
Western Digital Corp (NASDAQ: WDC)
Despite business conditions for the memory business remaining strained due to supply chain issues and a possibility of a recession, DNB decided to make WDC its second largest investment in Q3, now owning 4.5 million shares.
Investment firm Mizuho downgraded WDC shares in September to neutral, on worries surrounding data center and server markets, with softening PC demand across the globe.
YTD, WDC shares are down 47%, with shares trading from $31.56 to $38.95 over the past month. Technical analysis shows a resistance line at $37.18, displaying what may well be a solid entry position as prices have been consolidating for some time.
Analysts rate the shares a ‘hold,’ predicting that in the next 12 months, the stock could trade at $48.00, 37.69% higher than the current trading price of $34.86. Notably, out of 16 TipRanks analysts covering WDC, six have a ‘buy’ rating, eight a ‘hold’ rating, and two a ‘sell’ rating.
Qualcomm (NASDAQ: QCOM)
Semiconductor stocks have had a rough year so far, down strongly from their 2021 highs. Despite showing solid growth projections for the following period through the last two earnings reports, DNB added 356,089 shares of QCOM in Q3, bringing the total amount of shares the asset management firm holds to 586,651 shares.
In spite of the deteriorating business environment for semiconductor firms, Qualcomm is expected to post another strong quarter; if that occurs, the stock could be seen higher than current levels.
Currently, QCOM is down over 37% YTD, with both the short and long-term trends negative. Over the past month, the shares traded from $104.66 to $127.21, where technical analysis points to a support line at $108.64 and a resistance line at $115.75.
Analysts rate the shares a ‘moderate buy,’ predicting that prices have 57.02% to go higher from the current trading price of $115.74, equating to a price per share of $181.73. Moreover, out of 20 analysts covering QCOM, 13 have a ‘buy’ rating, and 7 have a ‘hold’ rating.
Finally, during volatile market situations, long-term investors prefer to add to their favorite or highest conviction companies, and DNB followed this game plan despite the fact that all three of their top acquisitions have lost more than 30% YTD on average.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.