50 Top Stock Picks That Billionaires Love
These 50 companies, of various shapes and sizes, are among the top stock picks held by billionaire investors or high-asset hedge funds.
You can't get rich by simply copying a billionaire's every move. However, it's always interesting – and often constructive – to know what the "smart money" is up to.
The billionaires, hedge funds and big-time asset-management firms below all have fortunes of various sizes. And studying which stock picks they're chasing with their capital (or which stocks the billionaires are selling off, for that matter) isn’t a half-bad idea.
There's a reason the rich get richer, after all. Their resources for research, as well as their intimate connections to insiders and others, can give them a unique insight into their stock picks.
Here are most recent 50 top stock picks of the billionaire class. In each case, at least one billionaire – be it a person, hedge fund or advisory – has a substantial stake and/or added to its holdings. In most cases, these stocks are owned by multiple billionaire investors and billionaire investor firms. And while several of these investments are popular blue chips, others keep a much lower profile.
Either way, the smart money isn't kidding around with these stocks.
Prices are as of Aug. 27. Data is courtesy of S&P Global Market Intelligence, WhaleWisdom.com and regulatory filings made with the Securities and Exchange Commission. Stocks ranked in reverse order of their weight in the selected billionaire's equity portfolio.
- Market value: $417.2 billion
- Billionaire investor: Jim Simons (Renaissance Technologies)
- Percent of portfolio: 1.0%
Billionaire Jim Simons is probably better known as a philanthropist than the founder of Renaissance Technologies (AUM $166 billion). Although he's no longer active in the day-to-day running of the fund, he still has input on stock picks and benefits from its success. Indeed, Renaissance's famed Medallion Fund (open only to employees and owners) helped Simons build a net worth of $23.5 billion.
Renaissance Technologies increased its holding of Tesla (TSLA, $2,238.75) by 44%, to 1.1 million shares, during the second quarter. Although that's just 1% of the firm's fund value, the trend is decidedly bullish. In Q1, Renaissance had only 0.4% of its holdings in Tesla.
He's about to own a larger number of shares, too: Tesla's stock is splitting 5-for-1, and will trade on a post-split basis starting Aug. 31.
A survey of four analysts by S&P Global Market Intelligence indicates that Wall Street expects Tesla to deliver annual average earnings growth of 60% over the next three to five years. You'll be hard-pressed to find those kind of growth expectations for a company worth $400 billion.
Just beware: As of late, Tesla has rocketed past Wall Street's 12-month price targets, making it susceptible to short-term profit taking.
- Market value: $30.3 billion
- Billionaire investor: Winslow Capital Management
- Percent of portfolio: 1.2%
IQVIA Holdings (IQV, $158.50), formerly known as Quintiles and IMS Health, brings technological solutions to health-care problems. It helps life science, drug-development and even care-provider companies collect and analyze data, then use that data to bring new products to the market.
Bain Capital – the private equity firm founded by current senator and one-time presidential candidate Mitt Romney – used to be one of the company's largest shareholders, but it has been cutting down its position for some time.
One big investor that's loading up is Winslow Capital Management ($18.7 billion). While IQV is hardly one of the Minneapolis hedge fund's overall top stock picks by weight, the new position was nonetheless a sizable one, at 1.7 million shares worth $237.1 million as of Q2's end.
Analysts' average recommendation on IQV is Buy. They expect the company to deliver average annual earnings growth of almost 11% over the next three to five years.
- Market value: $63.3 billion
- Billionaire investor: Echo Street Capital Management
- Percent of portfolio: 1.2%
Echo Street Capital Management is a smaller but scrappy hedge fund with 10 clients and $11.2 billion in assets under management. It holds a small position in CME Group (CME, $176.45), which owns the Chicago Mercantile Exchange, Chicago Board of Trade and New York Mercantile Exchange, among other exchanges.
But what's interesting is that its investment is growing – rapidly.
Echo Street initiated a position in CME Group during the first quarter, picking up 43,000 shares. In the second quarter it bought another 600,941 shares, which give it a 0.2% ownership stake in CME. Meanwhile, the stock has swollen from just 0.2% of the hedge fund's equity portfolio to 1.2%.
It's worth watching to see whether Echo Street continues to add to the position in the quarters ahead.
- Market value: $20.5 billion
- Billionaire investor: Encompass Capital Advisors
- Percent of portfolio: 1.5%
Encompass Capital Advisors (AUM $2.3 billion) initiated a sizable position in CVR Energy (CVI, $21.19) in the second quarter. The New York hedge fund plopped down about $11.5 million to acquire 572,066 shares in the energy firm.
Carl Icahn's Icahn Capital remains the top shareholder by a mile with 71% of the shares outstanding in the oil refiner. Encompass's stake comes to just 0.6% of the company.
It is, however, something of a vote of confidence that stands out amid a dull analyst crowd. The pros' average rating on CVI stands at Hold, by way of four Hold calls, two Sells and no Buys.
CVR Energy hasn't given anyone much reason to be excited, to be fair. CVI shares are off by 58% year-to-date, mirroring similar pain in energy stocks broadly.
- Market value: $140.9 billion
- Billionaire investor: River Road Asset Management
- Percent of portfolio: 1.7%
Bristol-Myers Squibb (BMY, $62.51) typically ranks among the analyst community's top stock picks, and several billionaires are content to hold the pharmaceutical firm in their portfolios.
River Road Asset Management, a large advisory firm that manages a total of $8.3 billion in assets, certainly is a fan. Its proprietary investment methods led it to buy another 652,857 shares in BMY in the second quarter. That represents a 61% increase in shares over the first quarter.
The Louisville, Kentucky-based firm first invested in BMY in 2019. After the addition of yet more shares, the pharmaceutical company now accounts for 1.7% of River Road's portfolio. The stake is worth more than $100 million.
Of the 12 analysts tracked by S&P Global Market Intelligence, 8 rate BMY at Buy or Better, while six rate it at Hold.
- Market value: $45.4 billion
- Billionaire investor: David Tepper (Appaloosa Management)
- Percent of portfolio: 1.8%
Billionaire David Tepper might have HCA Healthcare (HCA, $134.42) in his sights. The activist investor's Appaloosa Management (AUM $13.5 billion) significantly boosted its stake in the company in the second quarter.
Appaloosa added 765,000 shares for a total holding of 1,050,000. That represents just 0.3% of the company's shares outstanding, so we'll have to wait and see where this goes.
HCA Healthcare, which operates hospitals, emergency care centers and other medical establishments, has done at least a couple of things that attract activist investors. In addition to suspending its quarterly payout in April, HCA also stopped buying back its own shares.
With a net worth of $13 billion, according to Forbes, Tepper is considered to be the greatest hedge-fund honcho of his generation. He is also the owner of the NFL's Carolina Panthers.
Delta Air Lines
- Market value: $19.7 billion
- Billionaire investor: Bill Miller (Miller Value Partners)
- Percent of portfolio: 2.0%
Warren Buffett may have dumped his airline stocks during the second quarter, but that doesn't mean they're a bad fit for every portfolio. For example, Miller Value Partners (AUM $3 billion) found something worthwhile in Delta Air Lines (DAL, $30.82) stock.
The Baltimore-based hedge fund is headed by famed investor Bill Miller, the former chairman and chief investment officer of Legg Mason Capital Management. Miller also served as the portfolio manager of the Legg Mason Capital Management Value Trust, which brought him to prominence when he outperformed the S&P 500 for 15 years in a row.
Today, Miller is taking a stab at Delta Air Lines – a risky bet at this juncture of the coronavirus and economic crisis. Miller upped his stake in DAL by 11% last quarter, or 159,095 shares. His total holding comes to 1.6 million shares worth $44.8 million.
Delta's stock traded for less than $20 per share at one point in May, which was probably part of the appeal of adding to the position. DAL now accounts for 2% of the fund's portfolio.
- Market value: $43.7 billion
- Billionaire investor: Suvretta Capital Management
- Percent of portfolio: 2.2%
Suvretta Capital Management took a new position in Baxter International (BAX, $86.27) in the second quarter. The New York City-based hedge fund (AUM $5.8 billion) picked up 1,204,204 shares worth $104 million, good for 2.2% of the portfolio.
Baxter has appeal as a long-term health care stock because it benefits from a rapidly aging population. Areas of expertise include peritoneal dialysis and hemodialysis, renal replacement therapies, as well as other organ support therapies focused in the intensive care unit.
Shares have improved by 3% in 2020; 15 out of 18 analysts tracked by S&P Global Market Intelligence rate BAX at Buy or better.
Suvretta actually made a number of other entrances that immediately became top stock picks of 2% equity weights or more, including Royalty Pharma (RPRX), Canadian Pacific Railway (CP), Otis Worldwide (OTIS) and Facebook (FB).
- Market value: $1.70 trillion
- Billionaire investor: D.E. Shaw
- Percent of portfolio: 2.6%
David Elliot Shaw stepped away from day-to-day operations of his hedge fund years ago, but D.E. Shaw (AUM $82.1 billion) remains an outsized name on Wall Street. The fund is known for being a pioneer of high-speed quantitative trading. But you don't have to be a math genius to see the appeal of its largest holding.
D.E. Shaw upped its commitment to Amazon.com (AMZN, $3,400.00) by 86% in the second quarter, buying another 369,390 shares, for a total of 794,914. The hedge fund's stake in the e-commerce giant was worth $2.2 billion as of the end of the second quarter and accounted for 2.6% of its portfolio.
Interestingly, once upon a time, Amazon founder and CEO Jeff Bezos worked at D.E Shaw. Today, of course, he's by far and away the billionaire most associated with the retailer. With an estimated net worth of $199.2 billion – thanks mostly to his 15.4% ownership of AMZN – Bezos is the world's richest person, according to Forbes.
Procter & Gamble
- Market value: $343.6 billion
- Billionaire investor: GQG Partners
- Percent of portfolio: 2.6%
GQG Partners (AUM $30.3 billion), a large advisory firm based in Ft. Lauderdale, Fla., likes to maintain a concentrated portfolio. Indeed, its top 10 holdings comprise 52% of its entire portfolio.
The firm made a big bet on Procter & Gamble (PG, $138.21) during the second quarter of 2020, initiating a 4.9 million-share stake worth $588.9 million. The Dow stock now takes up 2.6% of the advisory firm's equity portfolio.
The pandemic has been helpful to consumer durable stocks such as PG. Shares are up 11% for the year-to-date, outpacing the S&P 500 by about 5 percentage points. The reliable dividend, which currently yields 2.3%, is another positive attribute of this stock. Analysts' average recommendation on PG comes to Buy.
Procter & Gamble boasts several other notable billionaire investors, including Trian Fund Management's Nelson Peltz, who we'll get to again in a bit.
- Market value: $28.1 billion
- Billionaire investor: Tobam
- Percent of portfolio: 3.3%
Warren Buffett is Kroger's (KR, $36.16) best-known billionaire investor, having first invested in the supermarket operator last year.
And, at least so far, he seems happy with the decision. In a quarter that saw Buffett pare back or completely sell stakes in 18 companies, Kroger got a shot in the arm. It was one of just six stocks Berkshire Hathaway put money into last spring.
Buffett's moves are likely inspiring to other big Kroger shareholders both here and abroad. In one example, Tobam, a Paris-based hedge fund ($7.2 billion), also bought more shares in the supermarket company this year to put KR among its top stock picks.
Specifically, Tobam added 166,581 shares for a total of 1.5 million shares worth more than $50 million – good for the second-largest position in the $1.5 billion equity portfolio. The French investor first acquired KR stock during the first quarter of 2016.
- Market value: $244.8 billion
- Billionaire investor: Copper Rock Capital Partners
- Percent of portfolio: 3.6%
Adobe (ADBE, $510.32) has always had little competition in creating software for designers and other creative types. Photoshop, for example, is so popular that it's often used generically to refer to any program that can edit and manipulate graphics.
But the company took a massive step a few years ago when it migrated its vast portfolio of offerings to the cloud – a move that still is paying off in spades. More recently, in late 2018, it moved into business-to-business marketing when it completed its acquisition of Marketo.
Copper Rock Capital Partners, with discretionary assets under management (AUM of $3.9 billion), is certainly a big fan. ADBE is the large advisory firm's top holding in the equity portfolio, comprising 3.6% of its portfolio. It topped up its stake a little during the second quarter with 6,830 shares to get to 48,167 – an investment worth about $21 million.
- Market value: $107.7 billion
- Billionaire investor: Sanders Capital
- Percent of portfolio: 3.7%
Citigroup (C, $51.72) is perennially among the hedge fund crowd's top stock picks. A money-center bank with a massive market value, share liquidity and a central place in the financial system will almost always be popular among professional asset allocators.
The comparatively high yield on the dividend is another plus.
Sanders Capital, a New York-based hedge fund with $38.3 billion in assets under management, first got involved with the bank in 2012. In the most recent quarter, it upped its bet by a relatively wide margin.
The fund bought 6,714,645 shares in Q2, bringing its total Citigroup holdings to 3.7% of its portfolio. That compares with 2.6% in the previous quarter.
And with a value of more than $1 billion, Sanders' 0.9% stake in the bank makes it a top-20 shareholder.
American Water Works
- Market value: $25.6 billion
- Investor: W.H. Reaves & Co.
- Percent of portfolio: 4.1%
W.H. Reaves & Co. bills itself as a long-term wealth creator. And the Jersey City ($3.3 billion) advisory backs up that talk with at least one of its larger positions.
American Water Works (AWK, $141.37) is a water and electricity utility operating in 16 states, serving approximately 3.4 million people. As a utility, of course it pays a dividend, although the yield comes to only 1.5%.
Where American Water Works stands out is that it has raised its dividend for 65 consecutive years. It also has been a winner of a long-term holding. Get this: On a price basis alone, AWK is up 520% over the past 10 years. The S&P 500 gained just 230% over the same time frame.
Reaves increased its holding in AWK by 35% to 762,797 shares, worth nearly $100 million. The firm's investment in the utility dates back to 2008 and is now its fourth-largest position.
- Market value: $23.9 billion
- Billionaire investor: Palestra Capital Management
- Percent of portfolio: 4.1%
A number of big investors bought new stakes in Verisign (VRSN, $207.87) last quarter, but no one made it as significant part of its portfolio in one fell swoop as Palestra Capital Management (AUM $5.5 billion).
The hedge fund initiated a position of 792,380 shares worth $163.9 million. VRSN is now one of Palestra's top stock picks, accounting for more than 4% of the equity portfolio.
Palestra happens to be in good company. Verisign, an internet infrastructure service company that quite literally keeps the world connected online and acts as a domain registry for the .com, .net and other top-level domains, has also caught the attention of Warren Buffett. Berkshire Hathaway first got involved in 2012, and it now holds nearly 13 million shares.
The New York firm runs a fairly concentrated portfolio, as its top 10 holdings claim more than 50% of its portfolio.
- Market value: $4.1 billion
- Billionaire investor: P2 Capital Partners
- Percent of portfolio: 4.4%
P2 Capital Partners (AUM $2.3 billion) is a hedge fund based out of New York with a slim list of holdings. Indeed, CEO and founder Claus Jorgen Moller maintains a highly concentrated portfolio with just 17 positions. The fund's top 10 holdings account for more than 75% of its equity assets.
Of course, as an activist investor, the hedge fund needs only enough shares to force changes at its target companies.
Change Healthcare (CHNG, $13.60) is the fund's newest target. P2 bought 4,678,454 shares in the health information and analytics company – a 1.5% equity stake worth nearly $55 million.
Where P2 Capital goes from here remains to be seen, but it could very well include a headache for CHNG's management team.
- Market value: $1.11 trillion
- Billionaire investor: Longview Partners (Guernsey)
- Percent of portfolio: 4.6%
Alphabet (GOOGL, $1,628.52) is among the tech giants dragging the S&P 500 and Nasdaq Composite to record highs this year. But even after a 17% gain for the year-to-date, it's not too late to get in on the fun.
Longview Partners (Guernsey) (AUM of $31.9 billion), based on the Channel Island of Guernsey, jumped in with both feet. The large advisory firm initiated a position of 685,369 shares worth $971.9 million.
Longview likes to maintain a concentrated portfolio. Indeed, its top 10 stock picks account for 51% of its equity assets. And it certainly committed to GOOGL in that way. The stake already comes to 4.6% of Longview's total holdings and was by far its biggest Q2 investment.
- Market value: $356.4 billion
- Billionaire investor: Polen Capital Management
- Percent of portfolio: 4.9%
Mastercard (MA, $356.00), the world's No. 2 payments processor, has fans in high places. True, Warren Buffett's Berkshire Hathaway trimmed its holdings by 7%, but other big investors were happy to buy.
But few professional stock pickers were as bullish as Polen Capital Management was during the second quarter. The Boca Raton hedge fund (AUM $27.3 billion) added 551,407 shares to its Mastercard holdings, bringing its total to nearly 5.5 million.
Apparently the fund buys into the idea that the relentless growth of digital mobile payments and other cashless transactions gives MA a bright outlook.
And well they should. Analysts, who rate shares at Buy, see MA generating average annual earnings growth of more than 18% over the next three to five years, according to S&P Global Market Intelligence.
- Market value: $125.9 billion
- Billionaire investor: Third Point (Daniel Loeb)
- Percent of portfolio: 5.1%
Charter Communications (CHTR, $614.29) is another stock hedge-fund macher Daniel Loeb is keen on. The billionaire with an estimated net worth of $2.9 billion added another 450,000 shares in the cable company in the second quarter.
Charter execs probably weren't thrilled with the news. Third Point has a reputation for being an activist investor, and it recently initiated a position in CHTR during the first quarter.
Third Point owns only 0.4% of Charter's shares outstanding, which doesn't give it much sway over the company at this point. Just don't be surprised if Loeb buys more Charter in Q3.
American International Group
- Market value: $25.6 billion
- Billionaire investor: Steve Cohen (Point72 Asset Management)
- Percent of portfolio: 5.2%
Once upon a time, American International Group (AIG, $29.68) was an insurance industry behemoth and a component of the Dow Jones Industrial Average. But the Great Recession changed everything. If not for a $182 billion bailout, AIG would have gone bust – and brought much of the global financial system with it.
Today, AIG remains one of the world's largest insurers, with business in general life, auto, home, business and travel insurance. It also sells retirement products and has financial services and asset management businesses.
AIG might have lost much of its prestige, but a number of big-money investors believe in it. For example, billionaire Steve Cohen, whom Forbes estimates is worth $14.6 billion, owns a stake by way of Point72 Asset Management Europe. It's a smaller outfit than his primary Point72, with just $87,121,000 in managed securities, but AIG instantly became a top-10 stock pick during the second quarter by way of a 145,999-share stake making up 5.2% of assets.
Point72 is actually Cohen's second act. His SAC Capital hedge fund was forced to shut down in 2013 because of insider trading.
- Market value: $768.9 billion
- Billionaire investor: Daniel Loeb (Third Point)
- Percent of portfolio: 5.8%
Jack Ma is probably the most famous billionaire associated with the online and mobile commerce juggernaut but it has plenty of other well-known – if not as spectacularly wealthy – fans.
Daniel Loeb, who is relatively famous for a hedge-fund honcho, started a new position in Alibaba (BABA, $284.17) in the second quarter. Third Point (AUM $21.1 billion) bought 2 million shares worth $431.4 million.
That's a heck of a shot in the arm for BABA bulls.
Moreover, it's a significant position. Although it gives Third Point control of only 0.07% of BABA's shares outstanding, in one swoop it became one of the hedge fund's top five stock picks, accounting for 5.8% of the portfolio.
- Market value: $835.3 billion
- Billionaire investor: Stephen Mandel (Lone Pine Capital)
- Percent of portfolio: 5.9%
Naturally, founder and CEO Mark Zuckerberg is the most famous billionaire owning a chunk of Facebook (FB, $293.22), but the social network is very popular with a long list of big-time investors.
One billionaire in particular stuck out as a Facebook fan last quarter. Stephen Mandel's Lone Pine Capital hedge fund, which manages nearly $20 billion worth of securities, upped its stake by almost 50%, or 1,734,964 shares. Lone Pine now owns 0.2% of FB's shares outstanding. Meanwhile, Facebook represents 5.9% of Lone Pine's equity assets, up from 3.5% a quarter earlier.
Mandel, with an estimated net worth of $2.8 billion, is famed for his prowess at fundamental analysis and bottom-up stock picking.
Chipotle Mexican Grill
- Market value: $35.8 billion
- Billionaire investor: Park Presidio Capital
- Percent of portfolio: 6.5%
About five years ago, Chipotle Mexican Grill (CMG, $1,279.63) was laid low by a series of outbreaks of foodborne illness, including two E. coli outbreaks that sickened 60 people.
It wasn't clear at the time that the fast-casual restaurant chain could mount a comeback in the age of social media. Shares lost about two-thirds of their value from their pre-crisis level to a 2018 low.
But the fast-casual restaurant chain came back in a big way, roaring back by roughly 410% from its February 2018 trench. And CMG continues to attract billionaires even as the coronavirus pandemic wreaks havoc on sit-down dining. Park Presidio Capital, a San Francisco-based hedge fund with $1.6 billion in overall assets, initiated a position in CMG in Q2, buying 55,000 shares worth $57.9 million.
It's a fairly big bet, as CMG now accounts for 6.5% of the hedge fund's total portfolio value.
- Market value: $311.9 billion
- Billionaire investor: James Hambro & Partners
- Percent of portfolio: 6.8%
JPMorgan Chase (JPM, $102.35), the nation's largest bank by assets, is naturally a hit with hedge funds, but one name in particular stands out. James Hambro & Partners ($3.8 billion in AUM) is interesting because Hambro is one of Britain's richest citizens.
Known as Jamie, Hambro made the British tabloids a few years back when local authorities shot down his $2.5 million plan to connect two of his adjacent houses in London.
Hambro holds 464,463 shares in JPM worth about $43.7 million after upping the position by about 11% in Q2. The stake accounts for 6.8% of the investment firm's portfolio.
The pros on average call JPM a Buy, but it's hardly unanimous. Sixteen analysts rate JPM at Buy or better, while nine say Hold. One analyst even has a rare Sell recommendation on the Dow stock.
- Market value: $81.7 billion
- Billionaire investor: Warren Buffett (Berkshire Hathaway)
- Percent of portfolio: 7.1%
Warren Buffett likes to say that his preferred holding period is forever, and that's about how long he has had a stake in American Express (AXP, $101.53).
Buffett picked up his initial stake in the credit card company in 1963, when a struggling AmEx badly needed capital. Berkshire obliged, getting favorable terms on its investment.
Berkshire owns 151.6 million shares in the Dow Jones Industrial Average component worth about $14.4 billion. That makes the holding company AXP's largest shareholder with 18.8% of its shares outstanding.
AmEx is not small potatoes to Warren Buffett either, seeing as it accounts for 7.1% of Berkshire Hathaway's equity stock picks.
- Market value: $449.0 billion
- Billionaire investor: Marshfield Associates
- Percent of portfolio: 7.4%
Marshfield Associates (AUM $3 billion) is a large advisory firm based in Washington, D.C., that is building up its stake in Visa (V, $211.03). The fund upped its ownership to 737,782 shares by the end of the second quarter. The position, which is more than 7% of its portfolio, is worth about $142.5 million.
Visa's appeal is easy to understand. As the world's largest payments processor, Visa is uniquely positioned to take advantage of the explosive global growth in digital mobile payments and other cashless transactions.
Warren Buffett is a big believer in the name, as well. Although he trimmed his position recently, Berkshire Hathaway still holds nearly 10 million Visa shares.
- Market value: $43.7 billion
- Billionaire investor: Abrams Bison Investments
- Percent of portfolio: 7.6%
Talk about a concentrated portfolio.
Abrams Bison Investments, based in Bethesda, Maryland, manages $2.3 billion in assets under management for just three clients – and holds positions in just 9 stocks.
One of the newest ones is defense contractor General Dynamics (GD, $152.44). The hedge fund poured $49 million into a new position last quarter to immediately make GD one of its top stock picks. The 328,000-share stake equals 7.6% of Abrams Bison's total stock portfolio.
Shares in the aerospace and defense company are off about 14% for the year-to-date, but analysts remain mostly bullish, with 13 Buy calls vs. six Hold calls. The Street expects GD to generate average annual earnings growth of more than 6% over the next three to five years.
Extended Stay America
- Market value: $2.2 billion
- Billionaire investor: Centerbridge Partners
- Percent of portfolio: 7.7%
The hotel industry has a long way to go to recover from the pandemic, but at least some big investors are getting in early. Centerbridge Partners (AUM $21.7 billion), for example, added to a relatively new position in Extended Stay America (STAY, $12.36) in Q2.
The New York hedge fund bought another 2.4 million shares to bring its STAY holdings up to nearly 8% of its portfolio value. The hedge fund initiated a roughly 810,000-share position in the company during the first quarter.
Extended Stay America is an off-the-radar hotel chain that serves a niche audience, accommodating guests who need to stay somewhere for more than just a few days. Its rooms include kitchenettes that let guests cook at home.
The lockdown caused by coronavirus hammered the hotel industry, but some analysts say better times are coming soon. Their average recommendation on STAY comes to Buy, according to S&P Global Market Intelligence.
- Market value: $42.5 billion
- Billionaire investor: Greenhaven Associates
- Percent of portfolio: 7.9%
General Motors (GM, $29.69) doesn't quite look like the bargain that it typically does. Significantly lower forecasts have pushed its valuation from a whopping discount to a more modest value pricing of 15 times forward-looking earnings estimates.
And while lower share prices normally would've meant a bigger yield on GM, they don't anymore. GM suspended its dividend in April.
Still, Greenhaven Associates, an advisory with $6.7 billion in assets under management and a $4.5 billion equity portfolio as of the end of Q2, saw fit to add to its already sizable stake in GM. The company bought nearly 4 million more shares to bring its stake to just above 14 million worth $356.1 million. The nearly 1% stake makes Greenhaven a top-20 shareholder in the automaker.
When Greenhaven bets, it tends to bet big. The fund's top 10 stock picks account for 80% of its portfolio.
- Market value: $310.7 billion
- Billionaire investor: Ensemble Capital Management
- Percent of portfolio: 8.1%
Home Depot (HD, $288.63) is having a fine year. The nation's largest home improvement retailer was allowed to stay open throughout the country's lockdowns, and it's also benefiting from people stuck at home sprucing up their abodes.
Indeed, HD stock is up by roughly a third in 2020, and analysts think it has farther to run. Their average recommendation comes to Buy, according to S&P Global Market Intelligence, and they expect average annual earnings growth of more than 7% over the next three to five years.
Ensemble Capital Management (AUM $1.0 billion), an advisory in Burlingame, California, is in on the game. It raised its stake in HD by 156% in the most recent quarter to 249,102 shares worth $62.4 million. At 8.1%, Home Depot is the second-largest position in the equity portfolio, right behind Netflix (NFLX, 8.6%).
- Market value: $49.6 billion
- Billionaire investor: David Tepper (Appaloosa Management)
- Percent of portfolio: 8.4%
Investors in semiconductor stocks have to accept that boom and bust cycles are just part of the program. Happily, Appaloosa Management's David Tepper sure seems to be at peace with Micron Technologies (MU, $44.62), which is one of his top stock picks at the moment.
The activist investor added another 490,000 shares, or 5%, in the chipmaker during the second quarter of 2020. In total, his fund's 9.4 million shares of MU make up a hefty 8.4% of Appaloosa's total holdings. Tepper's stake is worth about $482 million at current prices.
Tepper can be a headache for the C-suite, but Micron's management doesn't appear to be a target in this case – for now. Appaloosa holds just 0.84% of MU's shares outstanding.
- Market value: $166.4 billion
- Billionaire investor: Avidity Partners Management
- Percent of portfolio: 9.7%
AbbVie (ABBV, $94.30) was spun off from Abbott Laboratories (ABT) in 2013. And like its parent, the pharmaceutical maker carries a longstanding dividend-growth streak. Indeed, with almost a half-century of annual dividend hikes, AbbVie sits on S&P's list of Dividend Aristocrats.
The pharma giant has a number of hit drugs in its portfolio, such as Humira: a rheumatoid arthritis drug that has been approved for numerous other ailments, and that appears on pace to surpass Lipitor as the best-selling drug of all time. AbbVie also makes cancer drug Imbruvica, as well as testosterone replacement therapy AndroGel.
Avidity Partners Management clearly likes where this story is headed.
The Dallas hedge fund (AUM $1.2 billion) added to its already sizable stake in the second quarter, buying another 1,068,400 shares. With a net value of $151.7 million, ABBV accounts for almost 10% of Avidity's total portfolio value.
- Market value: $93.0 billion
- Billionaire investor: Soroban Capital Partners
- Percent of portfolio: 9.8%
Raytheon Technologies (RTX, $60.90) is having a rough year. Shares in the aerospace and defense company have lost 35% for the year-to-date, and it's being booted from the Dow Jones Industrial Average.
Part of the problem is that the commercial aircraft industry is dreadful in the age of coronavirus. Also at issue is that the market is still digesting its megamerger with United Technologies and subsequent break-offs. The former conglomerate spun off two of its businesses – Carrier Global and Otis Worldwide – and folded its aerospace operations into Raytheon Technologies earlier this year.
Some hedge funds are betting that now is the time to buy RTX low. New York-based Soroban Capital Partners (AUM $10.4 billion) initiated a new position in the second quarter by purchasing a whopping 12.4 million shares.
The stake, which is worth $761.4 million, immediately became the portfolio's third-largest position, accounting for nearly 10% of its assets.
- Market value: $26.2 billion
- Billionaire investor: Dsam Partners
- Percent of portfolio: 10.3%
Dsam Partners (AUM $1.6 billion) is a hedge fund based in London. It initiated a position in Carrier Global (CARR, $30.28) in Q2, and did so in a big way.
Dsam bought 1.5 million shares in the heating and cooling company worth $34.3 million. Carrier, which was recently spun off from the former United Technologies, immediately becomes one of the fund's top stock picks at more than 10% of the fund's equity portfolio.
Carrier is a mammoth player in climate control systems with three distinct business segments: Heating, Ventilating and Air Conditioning (HVAC); Refrigeration; and Fire & Safety.
Market dominance is only part of the story. Carrier is also a stalwart dividend growth stock. Including its time as part of United Technologies, it has raised its dividend for 26 consecutive years.
- Market value: $1.7 trillion
- Billionaire investor: TCI Fund Management
- Percent of portfolio: 11.7%
Microsoft (MSFT, $226.58) is a natural stock pick for pretty much any institutional investor's portfolio. Its Windows operating system still is the most popular in the world, and the company has fully figured out how to drive recurring revenue by selling cloud-based services (including its Office productivity suite) to both enterprise and retail customers.
One noteworthy top holder is TCI Fund Management, led by hedge-fund chief Chris Hohn. The London-based fund has $25.2 billion in managed securities and a top 10 holdings concentration of 95%. Hohn's net worth is estimated at $5 billion.
Almost 12% of the value of TCI's holdings stem from its 14.5 million MSFT shares. At current prices, the fund's stake was worth $2.9 billion as of the second quarter.
Indeed, TCI likes Microsoft so much it bought another 458,722 shares last quarter.
- Market value: $65.0 billion
- Billionaire investor: Leon Cooperman
- Percent of portfolio: 11.7%
Leon Cooperman is credited with building up Goldman Sachs' asset management division before striking out on his own. He shuttered his highly successful hedge fund Omega Advisors in 2018 after settling insider trading charges by the Securities and Exchange Commission.
Today, Cooperman, with a net worth of $2.5 billion, converted Omega into a smaller family shop run out of Boca Raton, Florida. And it just so happens that Cooperman (AUM $4.4 billion) ranks Cigna (CI, $177.08) among his top stock picks.
Cooperman first bought CI during the third quarter of 2018, and it has grown to be the fund's largest stake, taking up more than 11% of its portfolio. Although he didn't add to his holdings in the most recent quarter, Cigna also wasn't one of the 12 positions he cut down or cut out completely in Q2.
Wall Street sees something it likes in Cigna too. Of the 26 analysts covering the stock, 22 rate it at Buy or higher, while the remaining four call it a Hold.
- Market value: $50.8 billion
- Billionaire investor: Odey Asset Management Group
- Percent of portfolio: 11.8%
The most notable investor in Barrick Gold (GOLD, $28.58) is probably Warren Buffett's Berkshire Hathaway. The Oracle of Omaha initiated a position in the gold and copper miner in the second quarter, buying 20,918,701 shares worth $563.6 million.
The move had Buffett-watchers scratching their heads. After all, Warren Buffett is the farthest thing from a gold bug. Be that as it may, at least miners produce cash flow. In the case of Barrick, it even pays a small dividend.
However, Odey Asset Management, an advisory based in London with $3.5 billion in assets under management, isn't exactly a gold bug either. But they do allocate a substantial portion of their portfolio (11.8%) to Barrick Gold.
The firm bought another 1.2 million shares in the second quarter. Its total position of 2.6 million shares is worth about $68.8 million.
- Market value: $72.3 billion
- Billionaire investor: Greenhaven Associates
- Percent of portfolio: 12.9%
Goldman Sachs (GS, $210.15) was among the more notable stocks that Warren Buffett purged from Berkshire Hathaway's portfolio in Q2. The Wall Street investment bank stock still has plenty of fans, however.
Greenhaven Associates was busy last quarter. In addition to its GM bet, it made GS its second-largest holding. The firm bought another 39,533 shares in the Dow stock to bring its position to 2,947,430 shares worth $582.5 million. That accounts for 12.9% of Greenhaven's holdings.
Interestingly, Greenhaven's Edgar Wachenheim is the author of Common Stocks and Common Sense, a well-received book describing the fund chief's investing philosophy.
- Market value: $25.7 billion
- Billionaire investor: George Soros (Soros Fund Management)
- Percent of portfolio: 14.7%
Liberty Broadband (LBRDK, $141.23) is one of the largest cable-TV suppliers in the U.S., but it's not a familiar name. That's because the company makes its bones by holding a 26% interest in Charter Communications, and 100% of its Skyhook subsidiary.
A name that should be familiar to most folks is billionaire George Soros. The Hungarian-born investor is perhaps best known for making $1 billion on a trade by shorting the pound.
Less sexy but remunerative nonetheless is Soros Fund Management's stake in Liberty Broadband. The fund stood pat in the most recent quarter, but LBRDK remains important. With almost 15% of the portfolio dedicated to the position, it is Soros' largest equity holding.
And Soros is meaningful to Liberty, too. Soros Fund Management owns 2.9% of the cable company's shares outstanding, making it the fourth-largest shareholder.
Bausch Health Companies
- Market value: $6.0 billion
- Billionaire investor: John Paulson (Paulson & Co.)
- Percent of portfolio: 15.1%
Bausch Health Companies (BHC, $17.00) used to be known as Valeant Pharmaceuticals, and it would be happy if investors forgot that. A massive debt load, allegations of improper accounting and other controversies caused the stock to collapse in 2015.
BHC has since undergone an overhaul, and John Paulson, billionaire owner of hedge fund Paulson & Co. ($10.7 billion in AUM), is a big believer in the remade entity.
Indeed, he upped his stake by 5,000,000 shares in Q2. With a 7.2% stake worth $472.6 million as of the end of Q2, Paulson & Co. is the company's largest shareholder.
True, Paulson was a large stakeholder in 2015, before the company fell apart. But at least give him credit for sticking to his guns. BHC is Paulson & Co.'s largest position, accounting for 15.1% of its portfolio.
SPDR Gold Shares
- Assets under management: $77.4 billion
- Billionaire investor: Ray Dalio (Bridgewater Associates)
- Percent of portfolio: 15.3%
Warren Buffett isn't the only billionaire stocking up on gold investments. Ray Dalio's Bridgewater Associates (AUM $235.6 billion) is allocating a sizable portion of its own equity portfolio to the yellow metal.
Dalio, with a net worth of $16.9 billion, according to Forbes, is perhaps the most famous hedge fund founder of all time. That's due in part to Bridgewater, based in Westport, Connecticut, being the largest hedge fund on the planet.
If gold is a bet on bad times, Dalio's position may be cause for concern. The SPDR Gold Shares (GLD, $181.24) exchange-traded fund is Bridgewater's second-largest holding, and it only got bigger in Q2, as Dalio bought another 1.4 million shares in the ETF. The total position of 5.5 million shares is worth more than $910 million and accounts for more than 15% of Bridegwater's equity holdings.
It's unfair to say that Dalio is bearish on the market, however. Bridgewater's top holding is the S&P 500 SPDR ETF (SPY). Indeed, along with its 8.6% holding in the iShares Core S&P 500 ETF (IVV) – another S&P 500 tracker – more than a third of the hedge fund's portfolio is a simple bet on the broader market.
- Market value: $7.6 billion
- Billionaire investor: Toscafund Asset Management
- Percent of portfolio: 16.6%
Carl Icahn was once the biggest shareholder in Caesars Entertainment (CZR, $47.26), but once the activist investor forced a sale of the casino company to Eldorado Resorts – who then turned around and retained the Caesars name – last summer, his work was done. He sold out of his entire position in Q2.
Other pools of big money have stood by the company, however, even as the gambling and casino industry has been punished by the pandemic.
CZR is among the top stock picks of London-based Toscafund Asset Management (AUM $2.3 billion), which acquired 251,589 shares worth $10 million during the second quarter. That makes Caesars the fund's third-largest holding at 16.6%.
- Market value: $83.0 billion
- Billionaire investor: Nelson Peltz (Trian Fund Management)
- Percent of portfolio: 17.2%
Mondelez (MDLZ, $58.13) was born out of the 2012 spinoff of the North American grocery business called Kraft Foods Group. Kraft Foods Group later merged with H.J. Heinz in a 2015 deal backed by 3G Capital and Warren Buffett, to form Kraft Heinz (KHC).
Mondelez became a separate publicly traded company focused on snacks such as Oreo cookies and Triscuit crackers, but it hasn't always been a sweet deal for investors. MDLZ traded sideways for years before finally getting some upside momentum in 2019.
Billionaire CEO Nelson Peltz first took a stake in 2012, aiming to orchestrate a deal with beverage and snack giant PepsiCo (PEP). The deal fizzled, but Peltz held on to his position. During the second quarter, Trian bought another 3,581 shares in Mondelez – a small addition that brings him to 15.8 million shares.
But MDLZ is a big deal for Trian; the stake accounts for more than 17% of the equity portfolio's assets.
- Market value: $125.7 billion
- Billionaire investor: Bill Ackman (Pershing Square Capital)
- Percent of portfolio: 22.2%
Lowe's (LOW, $166.31) often plays second fiddle to Home Depot (HD), the nation's largest home improvement chain, but it's the top stock pick of one of Wall Street's most famed investors, and it has plenty to brag about as a long-term holding.
Income investors know the power of LOW. The retailer has paid a cash distribution every quarter since going public in 1961, and that dividend has increased annually for 57 years.
Lowe's also has the backing of one of the most recognizable billionaires on Wall Street. Bill Ackman's Pershing Square Capital (AUM $9.2 billion) holds 12.7 million shares, devoting 22.2% of its total value to LOW stock – good for the No. 1 position in the portfolio.
When Ackman initiated the position in 2018, he called on Lowe's to overhaul its marketing and supply chain to create operational efficiencies. LOW is up around 75% since the hedge-fund honcho first bought shares in the second quarter of 2018. Home improvement retailers and other housing market stocks have profited mightily during the pandemic.
- Market value: $518.2 billion
- Billionaire investor: H&H International Investment
- Percent of portfolio: 29.3%
The first billionaires who come to mind with Berkshire Hathaway (BRK.B, $216.87) are, of course, Warren Buffett, Charlie Munger and perhaps Microsoft founder Bill Gates. But there is no shortage of large advisory firms who love BRK.B too.
H&H International Investment ($3 billion) in Palo Alto, Calif., is one such investment manager. Heck, it has almost 30% of its portfolio squirreled away in Buffett's famed holding company.
That's after it acquired another 6.8 million shares in Q2. H&H's total position now comes to 8.5 million shares worth $1.5 billion. The firm first invested in BRK.B in the final quarter of 2018.
- Market value: $653.1 million
- Billionaire investor: John Doerr
- Percent of portfolio: 31.2%
Amyris (AMRS, $3.19) develops sustainable ingredients and chemicals for the beauty, health and fragrances and flavors industries. As a small-cap stock, it doesn't get a lot of attention from Wall Street, but it does have at least one legendary fan.
John Doerr, the investor and venture capitalist, is best known as chairman of Kleiner Perkins, which has been called Silicon Valley's most famous investment firm. Forbes puts his wealth at $11.5 billion, which means he can strike on his own when he wishes.
That's the case with Amyris; Doerr is the company's top shareholder with 10.4% of AMRS's shares outstanding, and the stock makes up almost a third of his portfolio.
Only two analysts track the stock, but they are both bullish. Their average target price comes to $10 a share.
- Market value: $394.6 million
- Billionaire investor: Ron Perelman (MacAndrews & Forbes)
- Percent of portfolio: 36.8%
Beauty company Revlon (REV, $7.40) is controlled by billionaire investor Ron Perelman, who is worth an estimated $6.3 billion, through his MacAndrews & Forbes holding company. And it's a sizable stake at that. REV accounts for almost 37% of the value of MacAndrews & Forbes' portfolio.
Additionally, MacAndrews & Forbes is the company's No. 1 shareholder with 87% of its shares outstanding.
REV is a longtime market laggard, however. Over the past five years, the stock has lost more than three quarters of its value. Only one analyst covers Revlon, according to S&P Global Market Intelligence, and that person's recommendation is set at Hold.
- Market value: $2.14 trillion
- Billionaire investor: Warren Buffett (Berkshire Hathaway)
- Percent of portfolio: 44.2%
"I don't think of Apple as a stock," Warren Buffett says. "I think of it as our third business."
That's one of the many songs of praise Buffett has belted out for Apple (AAPL, $500.04), which is the undisputed king of the Buffett stocks. Thanks to both its monumental run (heading into a late-August stock split), as well as lousy performances in several of Berkshire's other holdings, shares in the $2 trillion-plus company now make up more than 44% of Berkshire Hathaway's portfolio.
The Oracle of Omaha has only occasionally dabbled in technology stocks. But he bought Apple with two fists, and he's more than happy to discuss his ardor for AAPL. As he has said more than once on CNBC, he loves the power of Apple's brand and its ecosystem of products (such as the iPhone and iPad) and services (such as Apple Pay and iTunes).
"It's probably the best business I know in the world," Buffett said in February. "And that is a bigger commitment that we have in any business except insurance and the railroad."
With more than 245 million shares, Berkshire is Apple's third-largest shareholder after Vanguard and BlackRock – giants of the passively managed index fund universe. Buffett, with a net worth of roughly $82 billion, according to Forbes, owns 5.7% of Apple's shares outstanding.
- Market value: $8.5 billion
- Billionaire investor: Leon Black (Apollo Global Management)
- Percent of portfolio: 55.8%
ADT (ADT, $11.01), which provides home alarm and security systems for homes and businesses, has something most investors adore: a subscription business. Customers send checks like clockwork to maintain their service. Billing ranges from $36.99 to $52.99 a month.
A predictable cash stream is just one of the company's attractive attributes. Safehome.org gives the company high marks: "ADT is one of the top brands in the home security industry and we like their competitive rates and product variety." Analysts surveyed by S&P Global Market Intelligence, meanwhile, have an average recommendation of Buy on ADT.
ADT dominates the other stock picks held in Billionaire Leon Black's Apollo Management Holdings, a subsidiary of Apollo Global Management (APO). Apollo Management Holdings has a whopping 55.8% of its portfolio socked away in ADT at the moment.
Black arranged to buy ADT in 2016 for about $7 billion. Today, his subsidiaries control 85% of the company.
- Market value: $16.1 billion
- Billionaire investor: Brandywine Trust Company
- Percent of portfolio: 69.3%
Campbell Soup (CPB, $53.29) has proven to be a (cough) canny investment this year. Shares in companies that make foods with long shelf lives have proven to be winners at a time when eating at restaurants is unpopular.
Brandywine Trust Company (AUM $10 billion) is a big investment firm with a big bet on the soup company. The Delaware-based company added 3.1 million shares to its CPB holdings last quarter, to bring its total to 4.1 million shares worth $202 million as of the second quarter's end.
That position makes up a whopping 69% of the firm's $291 million equity portfolio.
The trust company is a top-10 shareholder in Campbell, which is up 7% so far in 2020. Regardless, analysts' average recommendation on the stock stands at Hold.
13F information courtesy of WhaleWisdom.com.