Billionaire Dan Loeb Just Sold Meta and Tesla Stocks and Piled Into This Hot AI Stock Up 1,500% Over the Past 5 Years

The S&P 500 climbed back out of its year-to-date declines and is finally showing gains, up 2% so far this year. The future is uncertain, especially concerning tariffs, and investors are wary.

But that doesn't mean investors are taking a break. Stocks continue to go up and down, with plenty of market beaters and plenty of market laggards; the S&P 500 is an average, after all, and some investors have pretty heated, and often opposing, views on different stocks.

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Take Tesla (NASDAQ: TSLA), for example. The Elon Musk-led electric vehicle (EV) powerhouse has certainly minted some millionaires, but it's facing increasing competition, among other issues, and it's down 27% this year -- including a double-digit loss on Thursday after CEO Elon Musk and President Donald Trump publicly sparred over social media. Nvidia (NASDAQ: NVDA) is also a polarizing stock, with the bulls and the bears split on just how big the company's future opportunity really is.

At least one billionaire investor has made his current opinion clear. Hedge fund Third Point, run by billionaire Dan Loeb, has about 45 equity positions. In the first quarter, Third Point sold all of its Tesla and Meta Platforms (NASDAQ: META) stock, and it bought 1.45 million shares of Nvidia stock, worth $157 million, in addition to some other trades. Let's see what investors are thinking about these stocks today.

Out of Tesla

The Third Point hedge fund is described as an "opportunistic, event-driven approach to finding investments." While its portfolio typically only has around 45 stocks, they change frequently. That strategy will influence how it invests, and as with hedge funds in general, it has different goals than the average individual investor who isn't investing billions of dollars.

The fund first bought Tesla stock in the 2024 third quarter and increased its stake in the fourth quarter, finally dumping it all in the 2025 first quarter.

It's not hard to see why investors are worried about Tesla stock right now. The U.S. EV company has tons of new competition, and automotive revenue sank 20% from last year in the first quarter, triggering a 9% decrease in total revenue. Its new robotaxi initiative, which investors are counting on to breathe new life back into the company, may not be the savior the company needs to rebound. There are already other self-driving cars on the road or in the works, and it may take time until the technology is robust enough to be a real revenue booster.

In addition, Tesla took a black eye when Musk was working as a special temporary federal employee and became one of Trump's closest and most controversial advisors. Musk has left the Department of Government Efficiency (DOGE) to return his focus on his businesses as Tesla saw deliveries and profits slump in the first quarter. But now that Musk is publicly sparring with Trump -- and the president is threatening to pull federal contracts from Musk's busineses -- Tesla stock is slumping yet again.

Tesla stock is far from cheap, trading at 164 times trailing-12-month earnings. Tesla stock is up around 68% from the time Third Point bough it, and given its strategy, it looks like it could be a good time to pocket its winnings.

Out of Meta

Meta is the leader in social media and digital advertising, two growing industries. Digital advertising continues to replace print ads, and as a low-cost business, Meta is leveraging its unparalleled platforms to generate high profits. Revenue increased 16% year over year in the first quarter, and net income increased 35%. It has a superlative operating margin that was 41% in the first quarter.

Meta stock isn't quite as polarizing as Tesla or Nvidia, with investors (fairly) uniformly seeing it as a good long-term play. It's up 18% in 2025, beating out the rest of the "Magnificent Seven" stocks.

Third Point bought Meta stock in the 2023 third quarter, and it's up 132% since then. Although Meta is beating the market this year and still has massive opportunities, Loeb and his team might see this as a good time to take their earnings, especially if they were looking for capital to invest in other stocks being driven by current events, like Nvidia.

Into Nvidia

While Third Point made solid money from its investments in Meta and Tesla, it missed out on the massive gains in Nvidia stock, which is up 1,500% over the past five years. Clearly, Loeb thinks that's far from over, and with Nvidia stock down earlier this year and trading at a bargain price, it looked ripe for the picking.

Nvidia stock plummeted in February when news came out about China's cheap DeepSeek artificial intelligence (AI) platform, but Nvidia maintained that it was good news for the entire AI industry, and that its best-in-class chips were only going to be in even greater demand. With two excellent earnings reports since then behind it, the market is reembracing the AI powerhouse.

Revenue increased 69% year over year in the 2026 fiscal first quarter (ended April 27), and demand is strong for its newest Blackwell AI technology. It's a real feat to keep reporting such high growth when it already has $148 billion in trailing-12-month revenue, and it's also incredibly profitable, with $78 billion in trailing-12-month income and a 52% profit margin.

As the unmatched leader in the industry, with constant innovation, Nvidia has massive opportunities up ahead as generative AI becomes a part of daily life and companies need its chips to deliver. As the cherry on top, Nvidia stock trades at only 25 times forward, one-year earnings.

It's easy to see why Loeb thinks it's a good time to buy Nvidia today, and he grabbed it on a dip. Investors can still find value in buying Nvidia stock at the current price.

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Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Jennifer Saibil has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms, Nvidia, and Tesla. The Motley Fool has a disclosure policy.