Goldman Sachs Group, Inc. lists the favorite American stocks of fund managers, with AppLovin (APP.US) included on the list.

Goldman Sachs Group, Inc.'s strategists stated that at the end of the fourth quarter, hedge funds and mutual funds had a mutual preference for stocks including AppLovin (APP.US), CRH public limited company (CRH.US), Mastercard (MA.US), Spotify (SPOT.US) and Visa (V.US). The company also noted that hedge funds seemed to be more selective in their positions in financial stocks compared to mutual funds. Goldman Sachs Group, Inc. strategist David Kostin said in a report on February 21, "Stocks that are favored by both hedge funds and mutual funds have historically performed well, but at the cost of increased volatility. Since 2013, the annual return of stocks favored by both has been 16%, with a standard deviation of 21%." According to Goldman Sachs Group, Inc.'s data, app marketing platform AppLovin was the only new addition to the list of jointly favored companies in the fourth quarter of 2024. As of last Friday's closing, the stock had risen 39% year-to-date and over 7 times in the past 12 months. Overall, jointly favored stocks have risen 14% so far this year, outperforming the S&P 500 index by 10 percentage points. However, these stocks are reasonably priced, with a median P/E ratio of 35, compared to the S&P 500 index's median P/E ratio of 19. According to Goldman Sachs Group, Inc.'s data, Fiserv (FI.US), Progressive (PGR.US) and Vertiv Holdings (VRT.US) were excluded from the list of popular stocks in the fourth quarter of last year. Goldman Sachs Group, Inc. noted that mutual funds on average increased their exposure to financial services stocks, while hedge funds "exited" in the fourth quarter. This difference is noteworthy as both types of funds increased their exposure to the financial industry before election day, believing it would benefit from a "policy agenda supportive of relaxation of regulations". However, by the end of this quarter, mutual funds had increased their holdings in financial stocks by 36 basis points to 223 basis points. In contrast, hedge funds decreased their exposure by 135 basis points from the third quarter, to a decrease of 41 basis points in the fourth quarter, the largest decrease. Hedge funds reduced their exposure to diversified banks such as Wells Fargo & Company (WFC.US), U.S. Bancorp (USB.US), and Bank of America Corp (BAC.US), diversified financial services such as Apollo Global Management (APO.US), and transaction and payment processing services such as PayPal (PYPL.US). Hedge funds added regional banks and brokers like RobinHood (HOOD.US), which Goldman Sachs Group, Inc. called a "rising star" in the fourth quarter. Meanwhile, mutual funds generally increased their exposure to the financial industry, especially in banks, capital markets, and insurance. Specifically, Goldman Sachs Group, Inc. identified six large mutual funds with "popular positions" that increased their exposure in the fourth quarter: Wells Fargo & Company, Mastercard, Bank of America Corp, Charles Schwab Corp (SCHW.US), U.S. Bancorp, and Citigroup (C.US).