Billionaire investor David Tepper is buying these 2 stocks

There is a strategy that is currently getting a lot of attention on Wall Street - tracking the investments of billionaires such as David Tepper, whose fortune is $21.5 billion. Tepper, the founder and president of Appaloosa Management, a hedge fund that focuses primarily on investing in stricken companies, has been buying shares of Chinese companies in recent months.

Investment trend: China's market recovery

After years of poor performance, investors are beginning to refocus on China in 2025. The world's second largest economy has taken several measures to boost consumer demand and stimulate various sectors. This move is an important factor that could help Chinese equities in the coming years, according to some market experts.

One indicator that confirms the value of Chinese stocks is the "Buffet Indicator", which compares the market capitalization of a country's publicly traded stocks to its GDP. If this indicator is below 100, the market is considered undervalued. In China's case, the ratio is below 70%, while the US market is at over 200%.

JD.com: Strong position in the e-commerce market

JD.com $JD, with a market value of $65 billion, specializes in electronics, home appliances, food, fashion and healthcare. In addition, it provides logistics services and digital solutions for businesses. The company has been publicly traded since February 2015 and has since achieved more than 100% returns for its shareholders.

In the last 12 months, JD.com reported revenue of $154.1 billion, a 4.1% year-over-year increase. Although the growth rate is slowing, the company is focused on increasing margins. In the most recent year, gross margins reached 9.5%, up from 8.8% in 2023 and 8% in 2022.

JD.com's revenue is expected to grow to $158 billion in 2024 and $166.4 billion in 2025. Adjusted earnings per share are expected to grow from $4.11 to $4.46 in 2025. JD.com shares are currently trading at a ratio of 9.3 times expected earnings, which analysts say is a low price.

Alibaba: Steady growth in e-commerce and cloud

Alibaba, with a market value of $296 billion, focuses on e-commerce platforms such as Taobao, Tmall and AliExpress and provides services in cloud, logistics and digital entertainment. Its revenue has grown from $12.3 billion in 2015 to $130.3 billion in 2024, with a 5.1% increase in the last 12 months to $132.6 billion.

Alibaba's sales are expected to grow to $138 billion in 2025 and $149 billion in 2026. Earnings per share are expected to rise from $8.68 in 2025 to $9.77 in 2026. At a ratio of 12.8 times expected earnings, BABA's stock price is considered reasonable.

Both JD.com and Alibaba currently have positive recommendations from most analysts, with a target price for JD.com that is 20% above the current trading price, while Alibaba's target price is below the current market value.

Disclaimer: There is a lot of inspiration to be found on Bulios, but stock selection and portfolio construction is up to you, so always do a thorough analysis of your own.

Source: barchart