Tepper’s hedge fund Appaloosa trimmed its positions in Alphabet and Amazon in Q3.
However, the billionaire loaded up on Qualcomm.
Analyst views on Qualcomm are mixed, but the stock’s valuation and growth prospects look attractive.
10 Stocks We Like More Than Qualcomm ›
Hedge fund managers and Wall Street analysts have several things in common. They watch the stock market like a hawk. They analyze financial data and industry trends to inform their decisions. They make public calls on individual stocks that may receive significant attention.
However, the opinions of hedge fund managers and analysts often differ. Take billionaire David Tepper, for example. He recently sold shares of Wall Street favorite Google parent Alphabet(NASDAQ: GOOG)(NASDAQ: GOOGL) and Amazon(NASDAQ: AMZN) and instead gathers into another artificial intelligence (AI) stock. Does Tepper know something Wall Street doesn’t?
Image source: Getty Images.
It should come as no surprise that Wall Street likes most of the so-called “Magnificent Seven” stocks. Alphabet and Amazon are no exception.
Of the 66 analysts surveyed by S&P Global(NYSE: SPGI) in December, 57 covering Alphabet rated the stock a “buy” or “strong buy.” The other nine analysts recommend holding Alphabet. No analyst thought selling the stock was a good idea.
There is even more excitement on Wall Street for Amazon. All but one of the 67 analysts surveyed by S&P Global rated the stock a “buy” or “strong buy.” The three outliers recommended keeping it. The average 12-month price target for Amazon reflects a potential upside of 26%.
Tepper cut his hedge fund Appaloosa’s positions in both stocks in the third quarter of 2025. He sold 7.4% of the fund’s stake in Amazon and 7.5% of Alphabet. Of course, these trades were made before the most recent S&P Global analyst surveys. However, Wall Street’s views on Alphabet and Amazon have been consistently bullish for months. Tepper clearly went against the prevailing consensus in the analyst community on these two actions.
While the billionaire hedge fund manager sold shares of Alphabet and Amazon in Q3, it loaded up on other AI stocks. Tepper increased the Appaloosa’s position in Qualcomm(NASDAQ: QCOM) by 255.7% in the last quarter.
Qualcomm is best known for its Snapdragon chips, which are used in smartphones and other devices. The company leverages its industry-leading position to be a leading player in cutting-edge AI (runs AI on local devices rather than in the cloud). From generative AI to agentic AI, Qualcomm aims to make its technology the best on the devices consumers use the most.
In addition, Qualcomm will soon compete with Nvidia(NASDAQ: NVDA) and Advanced microdevices(NASDAQ: AMD) in the data center AI accelerator market. The company plans to launch its AI200 chips in 2026, followed by AI250 chips in 2027.
What does Wall Street think about Qualcomm? Opinions are mixed. Of the 36 analysts surveyed by S&P Global in December, 16 rated Qualcomm a “buy” or “strong buy.” Another 19 recommended holding the stock, with one analyst giving it an “underperform” rating.
Back to the original question: Does Tepper know something Wall Street doesn’t? The short answer is…maybe. The billionaire investor may have picked up on something about Alphabet, Amazon and Qualcomm’s prospects that analysts have overlooked.
However, I wouldn’t make much of Tepper’s sales of Alphabet and Amazon in Q3. Appaloosa still holds significant positions in both stocks. Amazon remains the hedge fund’s second-largest holding, while Alphabet is the fifth-largest.
On the other hand, I think his aggressive buying of Qualcomm stock is worth noting. For what it’s worth, I suspect Tepper’s bullish view on stocks is justified. Given Qualcomm’s attractive valuation (its forward price-to-earnings ratio is just 13.8) and growth opportunities, I’m siding with the billionaire over Wall Street on this AI stock.
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Keith Speights has positions in Alphabet and Amazon. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, Nvidia, Qualcomm and S&P Global. The Motley Fool has a disclosure policy.
Does billionaire David Tepper know something Wall Street doesn’t? He’s selling Alphabet and Amazon and piling into this AI stock. was originally published by The Motley Fool
