3 Stocks the World’s Top Investors Are Loading Up On

If you want to be a better dancer, it’s probably a lot better to follow Beyoncé than your cousin’s TikTok channel. The same principle applies to the world of investments. If you want big returns, you need to learn from the best investors.

Those of you eager to learn from the pros will be glad to know that the world’s top investors are required to report their activity each quarter to the U.S. Securities and Exchange Commission. Here are three stocks they were buying with a vengeance as the markets collapsed in the second trimester.

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1. sea limited

During the three months ended June 30, 2022, Ray Dalio and Bridgewater Associates made many new stock purchases. The biggest new position Bridgewater started was limited sea (I KNOW 4.66%). This is a Singapore-based technology company that operates Shopee, an online marketplace popular throughout Southeast Asia and Taiwan. Sea Limited also owns Free shotthe most downloaded online game on mobile devices around the world in recent years.

Sea shares fell sharply in the first quarter, which probably made them look like a bargain for Dalio in the second. Now, he could buy them at lower prices than Bridgewater probably paid. A larger-than-expected net loss in the second quarter, followed by a decision to suspend forward guidance for the e-commerce segment, pressured the stock lower in August.

Investors are getting nervous about Sea’s growth strategy, and they probably should. The company has been using every dollar of profit from its gaming operation, and more, to fuel the growth of its e-commerce and digital financial services operations. Gaming revenue fell back in the second quarter, leading to a terrifying net loss of $931 million. It’s probably a good idea to wait for signs that Sea’s e-commerce and financial services segments can make a reliable profit before risking your own hard-earned money on this stock right now.

2. Financial ally

financial ally (ALLY 1.57%) is a fully digital consumer bank that was once the financial arm of general motors. To this day, it has a leading share in the lucrative auto loan market.

A well-known fan of banks, Warren Buffett, and the holding company he has run since the 1960s, Berkshire Hathawaymore than tripled its stake in Ally Financial during the second quarter.

Like many of Buffett’s favorite stocks, Ally pays dividends. At recent prices, this offers an above-average yield of 3.5% that could grow by leaps and bounds for the foreseeable future. Ally has increased her pay by 150% over the last five years, but the company needed only 20% of the last 12 months’ earnings to meet its dividend commitment.

At recent prices, you can buy Ally for just 0.9 times its book value. That’s a good price for a bank that just reported a 14.7% return on capital in the second quarter.

3. Walt Disney

Daniel Loeb and his hedge fund, Third Point Management, made a relatively large bet on walt-disney (DIS 1.05%) shares in the second quarter. Loeb bought 1 million shares of the entertainment company, making it 2.2% of Third Point’s portfolio.

There are many things that Disney investors like. An endless string of top-grossing comic book movies would be impressive on its own, but there’s so much more. This stock is attracting major investors because no one can leverage IP as effectively as the House of Mouse.

In the second quarter, revenue from Disney’s streaming services business grew 23% year over year to $4.9 billion. With far fewer COVID-related restrictions, revenue from the company’s parks has soared in the US and abroad.

Loeb was drawn to Disney in part because its streaming services appear to be gaining ground on the competition. At the end of April, Disney+ had 33% more subscribers than the previous year. With the opportunity to dominate the streaming industry for years to come, it’s probably a good time to add this stock to your own well-diversified portfolio.

Ally is an advertising partner for The Ascent, a Motley Fool company. Cory Renauer has no position in any of the mentioned stocks. The Motley Fool has stalls and recommends Sea Limited and Walt Disney. The Motley Fool recommends the following options: $145 long calls in January 2024 at Walt Disney and $155 short calls in January 2024 at Walt Disney. The Motley Fool has a disclosure policy.

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