From Yahoo Finance.: 2025-03-29 19:17:00

David Tepper’s investment theme focuses on China, confident in its recovery from the pandemic-induced slowdown. Appaloosa Management LP’s significant exposure to Chinese equities, especially in the internet sector, is paying off as Beijing implements measures to boost economic growth, leading to a bull run in Chinese stocks.

China’s economy exceeded expectations with 5.4% growth in Q4 2024, driven by stimulus policies like interest rate reductions. Further fiscal assistance is anticipated for the struggling real estate sector and consumer demand, reflecting the positive impact of Beijing’s measures.

US equities face pressure in Q1 2025 due to trade war uncertainties and the Fed’s reluctance to cut interest rates. The S&P 500 has dropped nearly 3%, marking its first quarterly decline since July 2023. Disappointing financial results and weak guidance are contributing to the market selloff.

Analysts express concerns over US corporate profits as Trump administration policies pose a risk of a global trade conflict. Projections for S&P 500 performance in Q1 2025 have decreased by 4.5%, with earnings growth expected to be 7.7%, the lowest rate since Q3 2023.

Amazon.com, Inc. (AMZN) ranks 2nd in David Tepper’s top growth stocks portfolio. The company’s diverse revenue streams, including online marketplaces, AWS, and advertising, contribute to its growth. Its cloud division, AWS, is a significant profit generator, with strong growth in AI and advertising sectors boosting revenue.

AWS accounted for 58% of Amazon’s operating profit in 2024, with revenues growing 19% to $28.8 billion. Advertising service revenues also increased by 18% to $17.3 billion in Q4. Analysts predict a compound annual growth rate (CAGR) of 10% for revenue and 20% for EPS between 2024 and 2027.

AMZN’s potential as an investment is acknowledged, but AI stocks are seen as offering greater returns in a shorter timeframe. Investors seeking promising AI stocks can explore options trading at less than 5 times earnings. AI market growth and economic improvements are expected to drive Amazon’s future growth.

Read more: Is Amazon.com, Inc. (AMZN) the Top Growth Stock in David Tepper’s Portfolio?