David Tepper amassed a fortune of $20.6 billion by making plenty of smart decisions. Some investors will probably question one of his recent decisions, though. In the fourth quarter of 2023, Tepper sold nearly 23% of his Appaloosa Management hedge fund’s position in Nvidia (NASDAQ: NVDA).
In retrospect, that doesn’t appear to be a great move. Nvidia’s shares have skyrocketed more than 70% so far in 2024. However, Tepper remains heavily invested in the GPU maker. Nvidia is still Appaloosa’s fourth-largest holding. He’s also still very bullish on artificial intelligence (AI). Here are four AI stocks the billionaire investor bought in Q4.
1. Oracle
Oracle (NYSE: ORCL) ranks as Tepper’s biggest new position in Q4. He bought 1.32 million shares of the database and software giant that were worth close to $140 million at the end of 2023.
Since then, Oracle’s shares have risen by a single-digit percentage. The company hasn’t had any major news to provide a catalyst yet in 2024. That could soon change: Oracle is scheduled to announce its fiscal 2024 third-quarter results on March 11.
In the meantime, Oracle has been busy bolstering its AI credentials. The company launched its new Oracle cloud infrastructure generative AI service in January. This new service enables Oracle’s cloud platform customers to build generative AI apps using large language models from Cohere and Meta Platforms. Oracle is also a major partner with Nvidia’s DGX Cloud AI supercomputing service.
2. Alibaba
Tepper also loaded up on Alibaba (NYSE: BABA) in Q4. His hedge fund already owned a sizable position in the Chinese tech stock but added another 750,000 shares. That was enough to boost Appaloosa’s stake in Alibaba by nearly 21%.
It’s not hard to see why Tepper might like Alibaba right now. The stock is down more than 20% over the last 12 months due in large part to sluggish growth in China. This decline, though, has made Alibaba cheaper than it’s been in quite a while with a forward earnings multiple of only 8.1 times.
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