2 Growth Stocks Down Over 70% Billionaires Are Piling Into

Prominent billionaire investors, including Stanley Druckenmiller and Daniel Loeb, significantly increased their stakes in DocuSign during Q2 2025, while Chase Coleman and David Tepper similarly expanded their positions in Block (formerly Square). These strategic acquisitions target 'fallen darlings' trading over 70% below their all-time highs, driven by DocuSign's new AI-powered Intelligent Agreement Management platform and Block's robust Cash App gross profit growth. This trend indicates a concerted effort by sophisticated funds to capitalize on discounted growth stocks perceived to have strong rebound potential and attractive valuations.

Analysis

Recent Q2 2025 13F filings indicate a strategic accumulation of shares in beaten-down technology firms DocuSign and Block by prominent institutional investors. Both companies are trading over 70% below their 2021 peaks, yet are attracting capital from managers like Stanley Druckenmiller (Duquesne) and Daniel Loeb (Third Point) for DocuSign, and Chase Coleman (Tiger Global) and David Tepper (Appaloosa) for Block. The investment thesis for DocuSign appears centered on a valuation reset, trading at 17 times trailing free cash flow, and a growth re-acceleration catalyst via its new AI-powered Intelligent Agreement Management (IAM) platform. While current revenue growth is a modest 8% year-over-year, management expects the IAM platform, which is already exceeding initial sales targets, to become a significant growth driver. For Block, the bullish case is supported by strong fundamental performance, including a 14% year-over-year increase in gross profit, driven by accelerating momentum in its Cash App. Key metrics for Cash App include a 16% rise in gross profit, a 16% increase in banking actives to 8 million users, and a near-doubling of annualized loan originations to $18 billion. Despite the crowded payments landscape, these investors are significantly increasing their positions, signaling confidence in the company's network effect and growth trajectory, which analysts project at 18% annualized earnings growth.

Key Decisions for Investors

• Consider the recent accumulation by notable investors in DocuSign and Block as a signal to re-evaluate these stocks as potential value-growth opportunities, given their significant price corrections from all-time highs.
• For DocuSign, investors should closely monitor the revenue contribution and adoption metrics of the new Intelligent Agreement Management (IAM) platform, as its success is the primary catalyst for accelerating growth beyond the current 8% rate.
• For Block, focus analysis on the key performance indicators for Cash App, specifically the continued growth in banking actives and loan origination volume, which are the core drivers of its accelerating profitability.
• While the investor interest is bullish, it is prudent to acknowledge the stated risks, such as intense competition for Block, and consider position sizing accordingly, mirroring the relatively small stakes held by some of the highlighted funds.