In this article, we discuss the 10 best investments of billionaire Peter Thiel. If you want to skip our detailed analysis of Thiel’s history and performance, go directly to the 5 Best Investments of Billionaire Peter Thiel.
Peter Thiel, the German-American entrepreneur who is one of the most successful investors in the United States with a net worth of over $5 billion, recently joined a new $100 million fund setup by SNO Ventures, a venture capital firm based in Norway. The fund aims to tap into the rich tech startup culture in Norway, Sweden, Denmark, Finland, and Iceland. Thiel, often referred to as the man with the golden touch due to his investment exploits, will provide the early stage companies that SNO invests in with growth and scaling advice.
Thiel has made a name for himself on Wall Street by investing in early stage companies with explosive growth potential. He was one of the earliest investors in Facebook, Inc. (NASDAQ: FB), the California-based technology company that owns several social media platforms. Facebook, Inc. (NASDAQ: FB) has now become one of the biggest companies in the world with billions of users spread across platforms like Facebook, Instagram, and WhatsApp. Thiel still serves on the board of directors of the company.
Another success story of the incredible career of Peter Thiel is PayPal Holdings, Inc. (NASDAQ: PYPL), the California-based payments company that the investor co-founded in 1998 and afterwards sold for $1.2 billion. PayPal Holdings, Inc. (NASDAQ: PYPL) is now a household name across the world as it has become the platform of choice for those wishing to make cross border transactions at low fees. The payments company has recently allowed users to checkout with cryptocurrencies as well, tapping into the digital currency market that will boost revenue.
In addition to other high-profile investments in companies like Stripe and SpaceX, both of which are expected to make blockbuster IPOs soon, Thiel is perhaps best known for his stewardship of Palantir Technologies Inc. (NYSE: PLTR), the Colorado-based big data analytics company that he co-founded in 2003 and afterwards helped go public, only stepping down from his role as chairman in 2019. Palantir Technologies Inc. (NYSE: PLTR) is now one of the most trusted names in the data analytics business and has even won the backing of the US government.
Besides his work in finance, Thiel also leads the Founder Fund, the Thiel Fellowship, and the Thiel Foundation. He is a New York Times bestselling author as well for his 2014 book titled Zero to One: Notes on Startups, or How to Build the Future. His investment philosophy revolves around sound financial principles, a focus on quality, and the recognition of the power of venture capital as a force for the good. Thiel is especially bullish on the fintech industry that has transformed the finance world in the past few years.
The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
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With this context in mind, here is our list of the 10 best investments of billionaire Peter Thiel. These companies were selected based on the returns they offered to Thiel on his initial investment, the name they have made for themselves since Thiel became associated with their brand, and the basic business fundamentals driving their earnings.
Best Investments of Billionaire Peter Thiel
10. Asana, Inc. (NYSE: ASAN)
Number of Hedge Fund Holders: 22
Asana, Inc. (NYSE: ASAN) is a company that operates a popular work management application. The stock has returned more than 83% to investors year-to-date. Asana went public through a direct listing in September 2020 and was valued at close to $4 billion on the first day of trading. The market capitalization of the firm has since grown to over $7 billion. Thiel led a Series B round of funding for Asana in 2012 through Founder Fund, his venture capital firm. He served on the board of directors for the firm before exiting in 2018.
Asana, Inc. (NYSE: ASAN) recently crushed market expectations on earnings per share and revenue for the first three months of 2021, raising guidance for the year ahead in the process. The company is placed tenth on our list of 10 best investments of billionaire Peter Thiel.
At the end of the first quarter of 2021, 22 hedge funds in the database of Insider Monkey held stakes worth $374 million in Asana, Inc. (NYSE: ASAN), up from 18 the preceding quarter worth $323 million.
Just like Facebook, Inc. (NASDAQ: FB), PayPal Holdings, Inc. (NASDAQ: PYPL), and Palantir Technologies Inc. (NYSE: PLTR), Asana, Inc. (NYSE: ASAN) is one of the best investments of billionaire Peter Thiel.
9. Lyft, Inc. (NASDAQ: LYFT)
Number of Hedge Fund Holders: 60
Lyft, Inc. (NASDAQ: LYFT) is a ride-sharing company with stakes in the food delivery business as well. The company’s shares have returned more than 63% to investors over the course of the past twelve months. It is ranked ninth on our list of 10 best investments of billionaire Peter Thiel. The investor was one of the earliest backers of the ride-sharing platform through the Founders Fund. Lyft has a market capitalization of over $19 billion and posted more than $2.3 billion in revenue last year despite the coronavirus crisis.
On May 4, Lyft, Inc. (NASDAQ: LYFT) missed market estimates for earnings per share in the first quarter of 2021 but beat on revenue. The company is expected to improve earnings in the second quarter as bookings improve following the vaccine rollout and the gradual reopening of the economy.
Out of the hedge funds being tracked by Insider Monkey, New York-based investment firm Alkeon Capital Management is a leading shareholder in Lyft, Inc. (NASDAQ: LYFT) with 5 million shares worth more than $321 million.
Just like Facebook, Inc. (NASDAQ: FB), PayPal Holdings, Inc. (NASDAQ: PYPL), and Palantir Technologies Inc. (NYSE: PLTR), Lyft, Inc. (NASDAQ: LYFT) is one of the best investments of billionaire Peter Thiel.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Lyft, Inc. (NASDAQ: LYFT) was one of them. Here is what the fund said:
“New purchase Lyft, the No. 2 U.S. rideshare operator, is exclusively focused on the secular growth opportunity in the rideshare market and stands to be a direct economic reopening beneficiary. The company made tremendous progress on margins during 2020 and improved its ability to meet long-term targets. Lyft is also leveraged to the eventual transition to autonomous driving.”
8. Yelp Inc. (NYSE: YELP)
Number of Hedge Fund Holders: 20
Yelp Inc. (NYSE: YELP) is a company that operates a platform which connects users with businesses and uses crowd-sourced reviews to help the users make better choices. Thiel was one of the earliest funders of Yelp Inc. (NYSE: YELP), helping the company with seed money. Yelp went public in March 2012 and was valued at close to $1.5 billion on the first day of trading. The company has since doubled in market capitalization. It is placed eighth on our list of 10 best investments of billionaire Peter Thiel.
Yelp Inc. (NYSE: YELP) stock has returned more than 65% to investors over the past year. The share price of the firm jumped more than 2% in early May after it beat market predictions on revenue for the first quarter of 2021 and raised guidance numbers for the rest of the fiscal year.
At the end of the first quarter of 2021, 20 hedge funds in the database of Insider Monkey held stakes worth $513 million in Yelp Inc. (NYSE: YELP), down from 31 in the previous quarter worth $527 million.
Just like Facebook, Inc. (NASDAQ: FB), PayPal Holdings, Inc. (NASDAQ: PYPL), and Palantir Technologies Inc. (NYSE: PLTR), Yelp Inc. (NYSE: YELP) is one of the best investments of billionaire Peter Thiel.
7. Airbnb, Inc. (NASDAQ: ABNB)
Number of Hedge Fund Holders: 52
Airbnb, Inc. (NASDAQ: ABNB) operates an online platform for vacation rentals. Thiel was one of the earliest backers of the firm, reportedly in talks to invest close to $150 million in the company in 2012 that would have valued it at over $2.5 billion. Thiel eventually helped the firm go public in late 2020 at a valuation of over $47 billion. The company finished the first day of trading at a valuation of above $100 billion, setting an IPO record. It has since slid to $92 billion in market capitalization. It is placed seventh on our list of 10 best investments of billionaire Peter Thiel.
Airbnb, Inc. (NASDAQ: ABNB) stock has offered investors returns exceeding 11% over the past month. On May 25, the firm announced several upgrades to its platform in expectation of a travel boom following the reopening of the economy after more than a year in lockdown.
Out of the hedge funds being tracked by Insider Monkey, California-based investment firm Silver Lake Partners is a leading shareholder in the firm with 2.5 million shares worth more than $481 million.
Just like Facebook, Inc. (NASDAQ: FB), PayPal Holdings, Inc. (NASDAQ: PYPL), and Palantir Technologies Inc. (NYSE: PLTR), Airbnb, Inc. (NASDAQ: ABNB) is one of the best investments of billionaire Peter Thiel.
6. Zynga Inc. (NASDAQ: ZNGA)
Number of Hedge Fund Holders: 47
Zynga Inc. (NASDAQ: ZNGA) is a game developer that concentrates on marketing of social game services. The stock has returned more than 14% to investors in the past year. It is ranked sixth on our list of 10 best investments of billionaire Peter Thiel. The billionaire was one of the angel investors in the company back in 2011 before a blockbuster IPO that valued the firm at over $7 billion on the first day of trading. The company has since crossed $11 billion in market capitalization.
Zynga Inc. (NASDAQ: ZNGA) stock was upgraded to Buy from Neutral by investment advisory Bank of America on May 6 with a price target of $13.5. The shares of the social gaming company jumped close to 6% after the ratings update.
At the end of the first quarter of 2021, 47 hedge funds in the database of Insider Monkey held stakes worth $1.1 billion in Zynga Inc. (NASDAQ: ZNGA), down from 52 in the previous quarter worth $1 billion.
Just like Asana, Inc. (NYSE: ASAN), Lyft, Inc. (NASDAQ: LYFT), Yelp Inc. (NYSE: YELP), Airbnb, Inc. (NASDAQ: ABNB), Facebook, Inc. (NASDAQ: FB), PayPal Holdings, Inc. (NASDAQ: PYPL), and Palantir Technologies Inc. (NYSE: PLTR), Zynga Inc. (NASDAQ: ZNGA) is one of the best investments of billionaire Peter Thiel.
In its Q4 2020 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Zynga Inc. (NASDAQ: ZNGA) was one of them. Here is what the fund said:
“We also added to our position in Zynga. Our multiyear investment campaign in Zynga has been based on a new management team’s ability to drive steady growth in the company’s base portfolio of games, expand margins, reinvigorate the new game development pipeline and use its strong balance sheet to acquire complementary games and studios. Shares have been pressured in recent quarters, presumably because of investor concerns about the company’s moderating growth rate and Apple’s pending new privacy policy which will make it more difficult for Zynga to both efficiently acquire new players and sell advertising in its games. We believe the company has multiple growth levers it can pull in the periods ahead, including the rollout of new games, acquisitions, further penetration into international markets and entry into new gaming categories, to name a few. Furthermore, our research suggests the Apple privacy policy change is manageable for larger mobile game developers such as Zynga. Given our strong conviction in the profit cycle, we used recent weakness to add to our position.”
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