Billionaire Investor Stanley Druckenmiller Sells Broadcom and Microsoft, Invests in 'Magnificent Seven' Stocks

Very few investors can claim to be in the same league as Warren Buffett, arguably the greatest investor ever. However, billionaire Stanley Druckenmiller stands out among them. Having worked as a fund manager for the legendary investor George Soros, Druckenmiller has a remarkable track record, never reporting a losing year while achieving impressive returns over decades. Currently, he continues to invest through his own fund, the Duquesne Family Office.

All funds with at least $100 million in assets under management must file 13F forms within 45 days of the end of each calendar quarter. This filing reveals the stocks held by the funds at the end of the quarter. Recently, on February 14, the fourth quarter 2024 filings were made public, showing that Duquesne had exited its positions in Broadcom (AVGO) and Microsoft (MSFT) while investing heavily in three stocks from the "Magnificent Seven" instead.

Exiting Positions in Broadcom and Microsoft

According to Duquesne's 13F filing, the fund sold nearly 240,000 shares of Broadcom and about 43,100 shares of Microsoft. Broadcom performed exceptionally well in 2024, with its stock price increasing nearly 108%. In contrast, Microsoft lagged behind the market, posting only a 12% gain.

Druckenmiller has traded shares of Broadcom since 2023, briefly acquiring a stake in the third quarter of 2023 before selling in the following quarter. This pattern repeated itself during the third and fourth quarters of 2024. Analysis suggests that Druckenmiller managed to sell Broadcom shares at higher average prices than his purchase prices, achieving gains between 9% and 16%.

Broadcom has captured market attention with its custom chips used to implement specific artificial intelligence (AI) strategies. Notably, one client is Meta Platforms, for which they developed the Meta Training and Inference Accelerator chip. With Meta planning significant investments in AI, Broadcom is well-positioned, and many analysts speculate about its relationship with OpenAI.

Meanwhile, Druckenmiller has been investing in Microsoft for over ten years, conducting 41 transactions since 2014, including a new investment in early 2023. However, he began reducing his position in the second quarter of 2024 and ultimately exited in the fourth quarter.

Despite being part of the Magnificent Seven, Microsoft struggled to capitalize on AI advancements in 2024, as investors raised concerns about the company’s AI strategy and its revenue-generating potential. Additionally, Microsoft faced challenges meeting its performance guidance over the past year. Druckenmiller's investment strategy typically involves moving in and out of stocks, focusing on technology and AI while remaining cautious about valuations.

Investing in Other Magnificent Seven Stocks

After selling his stakes in Microsoft and Broadcom, Druckenmiller invested in several other prominent tech and AI stocks in the fourth quarter, which included:

• 328,400 shares of Amazon (AMZN)
• 37,675 shares of Tesla (TSLA)
• 76,680 shares of Alphabet (GOOGL)

Although the 13F filing confirms the purchases, it does not specify the exact timing. If these shares were acquired prior to Donald Trump’s election victory on November 5, 2024, Druckenmiller likely made substantial gains.

Considering Druckenmiller's keen market instincts, he had previously indicated that he believed the market had already priced in a Trump victory. Given the valuation climate and the recent rally of stocks, he may opt to sell Tesla during this quarter.

In investing in Amazon and Alphabet, both companies present broader revenue streams beyond just AI. Amazon generates significant income from its software, retail, and subscription services. Analysts are optimistic that Alphabet possesses valuable AI assets that can unlock significant value, despite the challenges posed by the U.S. Department of Justice's ongoing lawsuit against the company, which many believe will eventually be resolved.

investment, Druckenmiller, tech