What are top 5 stocks?

What are top 5 stocks?

All right you guys know the story it's now been more than 45 days since the end of Q3 thus the 13f filings are out so in this article we're going to take a look at the five most bought Stocks by our super investor friends for Q3 of 2022 a quarter that saw the S P 500 both gained 12 and lose 17 so there was certainly volatility in the broader market and there was volatility in some of the world's largest stocks as well just have a look at some of these stock charts Apple Amazon Google Microsoft Tesla all bouncing around a lot in Q3 so with that said what businesses peaked the interest of our 79 super investors this time round well let's find out.


Okay let's start by just very quickly flying through stocks ten to six and then we'll spend a little bit more time going through the top five so the 10th most bought stock this quarter was in fact Micron a big American producer of computer memory and computer data storage so there's a big 180 happening right now in consumer electronics as businesses slash profit forecasts and it's causing Mayhem in stock prices in the space in fact if you look at Micron stock from the start of the year until the end of Q3 it's basically halved so chances are a lot of the value crowd see long-term potential in this one including people like monish lilu guys


Spear and Seth clarman their next up coming in at number nine we have Disney Disney is another stock that's been beaten down this year yet operationally you know their park segment is continuing to improve post covert and they keep adding lots and lots of subscribers to Disney plus which is their main growth engine for the next five years or so overall Disney is a diversified proven business model and I think the super investors like that deal especially as here today the stock has dropped nearly 40 percent they're moving on coming in at number eight it's PayPal a very dominant player in online payments as of September they had 41 of that market and with the stock back to levels not seen since the depths of the 2020 market.

Crash I think definitely some of the super investors are seeing this as a long-term opportunity next up number seven we have Salesforce who offer a very well-known customer relationship management platform down 43 from the start of the year to the end of Q3 but this is honestly not one I follow so I can't add too much flavor on this one then next up at number six we have booking Holdings which is a collection of travel related businesses including booking.com.


Priceline.com kayak agodarentalcars.com and OpenTable they like all travel businesses got hurt a lot in 2020 and 2021 but are now well and truly recovering this was also a popular stock in Q2 with eight super investors buying in and same again this quarter and fair enough as the stock has trended further down in Q3 versus Q2 okay so that is a very very quick word on stocks temporary six.


And now let's dive a little bit deeper into the five most bought stocks so let's just keep this thing rolling the fifth most bought stock by our super investors this quarter was Visa now I do have to say Visa is not really a stock in my own circle of competence however it is a very well-known buffet style stock thanks to its massive moat has a massive Network effect and now can basically just collect tolls as it's the world's number one payment facilitator essentially every time you go to tap your card at the shopping center Visa's job is to connect the stores bank with your bank and actually facilitate the transfer of money across to complete the transaction they have the technology that facilitates these payments quickly accurately and safely and they charge the merchant a very small fee for every transaction that they facilitate and while this fee is Tiny it definitely adds up as in the 12 months ending September 30th 2022 Visa processed 192.5 billion transactions as a lot of payments overall they enjoy an approximate 50 market share by purchase volume with Mastercard at 23 and with American Express the next largest at 19 plus if we turn over to Simply Wall Street you can see that currently they have a slightly lower PE ratio versus their peers and they are slightly undervalued by a standard discounted cash flow analysis and with the stock at one point dipping 18 in Q3 clearly some super investors saw that as an opportunity to buy so that's Visa then coming in at number four we have Amazon what I thought Amazon stock was dying well I think this story boils down to an amazing business going through a particularly tough patch right now because if you look now the stock has basically eliminated all of the gains it saw thanks to the pandemic shutdowns.

And is now down around 50 for the year but here's the deal Amazon has been sinking like 60 billion dollars a year into growing their capacity and they actually have managed to roughly double their revenue since 2020 however what's happening right now is that despite all of this investment in increasing capacity unfortunately consumers have a lot less discretionary income than say in 2020 and 2021 due to stimulus payments stopping and interest rates now Rising so now Amazon have to weather this tough economic patch where consumer spending has done a 180 but they've got all these higher costs from all their Investments anyway the result is yes revenue is higher Shore but also cost of goods sold is higher as you can see here operating expenses are a lot higher head count is a lot higher for example and ultimately net income is lower and free cash flow is tanking there's fear in the media Amazon announces layoffs and all of a sudden the stock Dives but it's still obviously a really solid company it's just that a company like Amazon will always be somewhat at the mercy of the current macro economic climate and of course consumer spending however that didn't stop 11 of our super investors from buying more in Q3 and if we turn over to Simply Wall Street again we can see that they hint at a solid margin of safety from a discounted cash flow analysis at the current time of course that doesn't mean you should just go out and buy it but it does highlight that maybe you want to go in and do a little bit more research on this one as it may present some sort of opportunity and by the way all of these stocks that I'm talking about today have actually been published in a discovery collection over on simply Wall Street.

So if you did want to actually check out this list and then go and check out valuation future expectations past performance Financial Health on literally any of these companies head to the link down in the description of the pin comment and if you did want to get access to the premium version of Simply Wall Street that I use for my videos you can get 40 off through those links down below but moving on now to the third most bought stock by our super investors and this time around it was meta 13 super investors added to meta in Q3 and let's be real it's no surprise as to why in q1 this is one of the most bought stocks in Q2 this is one of the most bought stocks and with the stock falling another 15 across Q3 it's no surprise that meta yep it slots into this list yet again so what's the deal with meta well it's a huge moat company again it has a very large Network effect but of course meta's business has changed quite a bit recently it used to be a much more simple just straight up money printer low cost and all they did was just show ads on their apps and just print money but now obviously a lot has changed you know with the macroeconomic environment as it is Big advertisers have been pulling back on their budgets for example in Q3 meta did see an 18 year-over-year reduction in price per ad but also they're burning a lot of money on metaverse development right now which is giving them a lot less profit for example in Q3 their r d ballooned year of year to 9.1 billion dollars but their revenue actually shrunk leaving just 4.4 billion in net income versus 9.1 billion in Q3 of 2021. that plus weak Q4 guidance and the stock has kept falling now into Q4 as well so begs the question why are all these super investors still interested well I think this is another case of copying short-term pain for potential long-term gain but remember Wall Street can't hang around for that thus the stock price crashes our super investors on the other hand they know the value of being long-term focused so they can wait these things out and beyond that I think it's also worth remembering that you know meta do have a big Advantage here because all of this increased spending isn't necessarily forced you know they want to do this and if their situation drastically changed and all of a sudden their business sucked they could just press pause on the metaverse project and become a lot more profitable again but overall 13 super investors bought into meta in Q3 and if we turn over to Simply Wall Street we can see Meta sits at a very low 10.3 PE with a very healthy margin of safety on their discounted cash flow analysis okay moving on to the second most bought stock and it is Microsoft Microsoft was another poor performer in q three with the stock ending the quarter down 10 but again this is a big wide moat company with all the various B2B and b2c products that Microsoft make overall Microsoft has three Revenue segments they have productivity and business processes which is Office 365 commercial and consumer as well as Dynamics and Linkedin then they have intelligent Cloud which is azure and other cloud services and lastly they have personal Computing which is Windows Surface and Xbox and that sort of stuff and for Microsoft these three businesses each make up roughly one third of their revenue and they were making about one third of their operating income each but what we've seen over the past few quarters is that their Cloud segment is just absolutely ripping and their personal Computing segment is slowing and this is very much a result of the macro environment and the consumer having a lot less to spend right now so while businesses still need Microsoft's cloud services to run and all that good stuff the consumer is saving money where they can and pay PC sales are way down but overall Microsoft is generally very well protected thanks to their economic notes in software and cloud and thus despite the stock falling around 28 year-to-date it continues to attract these long-term minded super investors and with that said now we hit number one so drum roll please let's get into it the most bought stock by our super investors in Q3 of 2022 was Google we had nine super investors buying into the sea shares and 12 buying into the a shares during the quarter and again no surprise at all because number one Google got 12 cheaper across Q3 and also number two it's usually one of the most bought Stocks by our super investors so with that said what's the deal with Google well it has an incredibly strong balance sheet with minimal debts literally got 22 billion in Plano cash and only 14.6 billion in long-term debt they have a massive mode in online search and digital advertising as shown by this table here you know over the past five years they've been able to grow their revenue by 24 annually EPS by 46 annually Equity by 13 free cash flow by 23 then in terms of management skill they've maintained an average return investor capital of 18 over the past five years as we said before that debt management has been very very good you know at the end of the day this is a rock solid business but of course that's only half the equation because we also need to pay a fair price but with so many super investors jumping in right now it does seem to suggest that maybe we should be revisiting our discounted cash flow analysis and it's worth noting the inbuilt discounted cash flow analysis over on simply Wall Street shows quite a healthy discount at current levels and I'm not even sure if they're factoring their cash position into that equation because of course remember if you are looking to buy say a house for half a million bucks if you knew there was a hundred thousand dollars buried in the backyard that would obviously alter what you'd be willing to pay for the house but overall unless this stock shoots up a lot in the next quarter I think this will continue to be one of the most bought stocks and it will keep up at the top of this list but overall guys with that said definitely let me know what you think down in the comments section below you know do you hold any of these businesses do you agree or disagree with the super investors this time around definitely let me know also big thanks to Simply Wall Street for sponsoring as always and as I said before you can get 40 off using the link in the pinned comment and also in the description but apart from that guys thanks very much.