Billionaire David Tepper of Appaloosa Tripled His Stake in Micron but Has Been Dumping a Historically Cheap AI Stock Over the Last Year

By Sean Williams – Mar 18, 2026 at 4:06AM ESTKey PointsForm 13Fs offer investors an under-the-hood look at which stocks Wall Street's premier money managers have been buying and selling.The insatiable demand for high-bandwidth memory and artificial intelligence (AI) data center infrastructure has been the ultimate tailwind for Micron Technology.Meanwhile, Appaloosa's top holding, a cash-rich, China-based AI stock, has been slashed by 57% since the end of 2024.Roughly one month ago, on Feb. 17, institutional investors with at least $100 million in assets under management were required to file Form 13F with the Securities and Exchange Commission. This formal-sounding filing provides investors with a way to track which stocks Wall Street's savviest money managers bought and sold in the latest quarter (in this case, the fourth quarter).

Billionaire David Tepper of Appaloosa is among the most-followed and successful fund managers. During the fourth quarter, Tepper tripled his fund's stake in memory and storage titan Micron Technology (MU +4.44%). On the other hand, he sent shares of his No. 1 holding -- and arguably one of the cheapest artificial intelligence (AI) stocks -- packing for a fourth consecutive quarter. Image source: Getty Images.

Billionaire David Tepper is piling into Micron Appaloosa's latest 13F shows that Tepper oversaw the purchase of 1 million shares of Micron during the fourth quarter. This increased the fund's position to 1.5 million shares, making Micron Appaloosa's fourth-largest holding by market value. It also booted AI kingpin Nvidia from Appaloosa's top-five holdings. There's no doubt that AI is Micron's core growth driver at the moment. It's one of the world's primary suppliers of high-bandwidth memory (HBM). HBM is stacked with graphics processing units (GPUs) to support fast-paced computing in AI-accelerated data centers. ExpandNASDAQ: MUMicron TechnologyToday's Change(4.44%) $19.63Current Price$461.43Key Data PointsMarket Cap$520BDay's Range$445.11 - $462.7152wk Range$61.54 - $462.73Volume1.6MAvg Vol35MGross Margin45.53%Dividend Yield0.10% Enterprise demand for AI data center infrastructure is virtually insatiable, leading to a shortage of HBM and GPUs. This combination of strong demand coupled with limited supply is affording Micron exceptional pricing power and has sent its gross margin to the heavens (56% in the fiscal first quarter, ended Nov. 27, 2025, compared to 38.4% one year prior). Tepper was likely also attracted by Micron's valuation. Even though shares have quadrupled since early August 2025, the company's projected profits have risen even faster. As of the closing bell on March 13, Micron is trading at a forward price-to-earnings (P/E) ratio of just 9. Image source: Getty Images. Appaloosa's No. 1 holding was trimmed by 57% in 2025 What may be even more eye-popping than billionaire David Tepper tripling his stake in Micron is the persistent selling of his fund's No. 1 holding, China-based Alibaba Group (BABA 0.10%). Appaloosa's billionaire boss dumped 1,312,069 shares of Alibaba during the fourth quarter and sent 57% of his fund's stake in this AI titan to the chopping block in 2025. Profit-taking is certainly a logical reason for this selling. Since Tepper opened a sizable position in Alibaba during the second quarter of 2023, shares of the company have soared from the $80s to as high as $192. It's possible Appaloosa's head investor was simply booking profits last year. ExpandNYSE: BABAAlibaba GroupToday's Change(-0.10%) $-0.14Current Price$136.57Key Data PointsMarket Cap$307BDay's Range$135.97 - $138.2252wk Range$94.97 - $192.67Volume98KAvg Vol11MGross Margin40.73%Dividend Yield0.77% However, there may be more to this story than just benign profit-taking. Tepper may be turned off by President Donald Trump's tariff and trade policy, which has seemingly widened the trade rift between China and the U.S. Although Alibaba is a China-focused company, geopolitical turbulence can still adversely impact it. Tepper might also view Alibaba as less of a bargain than he has in the past. While its forward P/E of 15 remains historically cheap for an AI stock, especially factoring in the company's cash-rich balance sheet, it's a notably higher forward P/E for Alibaba than in recent years.Read NextMar 14, 2026 •By Adam LevyPrediction: 1 Artificial Intelligence (AI) Stock That Will Be Worth More Than Micron and Palantir by 2027Feb 5, 2026 •By Adam LevyPrediction: This Artificial Intelligence (AI) Stock Will Be Worth More Than Micron By the End of Next YearJan 16, 2026 •By Stefon Walters3 Reasons to Buy Alibaba Stock Like There's No TomorrowJan 1, 2026 •By Leo SunBest Stock to Buy Right Now: Alibaba vs. TencentDec 22, 2025 •By James BrumleyThe AI Stock That's Secretly Crushing NvidiaDec 11, 2025 •By Adam LevyPrediction: These 2 Artificial Intelligence (AI) Stocks Will Be Worth More Than Palantir by the End of 2026About the AuthorSean Williams is a data-driven Motley Fool contributing analyst who's been investing for 27 years and has penned north of 15,000 articles. You'll find him at the intersection of politics and investing tackling macroeconomic topics of interest (Social Security and Donald Trump's economic/tax policies), analyzing which stocks billionaire investors (e.g., Warren Buffett) are buying and selling, and digging into how the world's most-influential businesses and trends -- everything from the evolution of artificial intelligence (AI) to the next stock split -- are changing Wall Street. He holds a B.A. in Economics from the University of California, San Diego.TMFUltraLongX@AMCScamStocks MentionedAlibaba GroupNYSE: BABA$136.57(-0.10%)-$0.14Micron TechnologyNASDAQ: MU$461.43(+4.44%)+$19.63NvidiaNASDAQ: NVDA$181.86(-0.74%)-$1.36*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.