Long-Term Investment Ideas from Julian Robertson’s Portfolio

TIGER MANAGEMENTJulian Robertson manages the famous Tiger Management, which boasted impressive 31.7 percent annual returns between 1980 and 1998. His “Tiger cubs” include Philippe Laffont and Stephen Mandel, among many others. This article takes a look at Tiger Management’s portfolio from the passive, long-term value investor’s perspective. Low or average P/Es, market caps of over $20 billion, and long-term dividend or share buy-back programs are positives when it comes to assembling a passive portfolio. Here are some of the best long-term picks from Robertson’s fund (view the fund’s entire portfolio here).

Mastercard and Visa

Mastercard Inc (NYSE:MA) has a forward P/E of 17, comparable to its competitor Visa Inc (NYSE:V). Robertson holds both, and both are promising long-term plays. Mastercard Inc has consistently paid a very modest dividend since its IPO in 2006, and the company bought back 1.6 million shares in the second quarter 2012 for about $670 million. Mastercard is now repurchasing shares under its new $1.5 billion buy-back authorization. Visa Inc maintains a slightly higher dividend yield at 0.7 percent.

Broadly, both company’s businesses are exposed to consumer spending slowdowns in Europe and the United States, but both are focusing on the so-called “war on cash” as opposed to a war with each other. Since about 85 percent of the world’s consumer transactions are paid for in cash or check, both Visa and Mastercard see lots of market space available for development regardless of economic climate. Mastercard and Visa have betas of 0.9 and 0.8, respectively, which are below average for financial services stocks.

Qualcomm

Qualcomm, Inc. (NASDAQ:QCOM) has consistently paid a dividend since 2003, which presently yields 1.6 percent. In 2011, the company returned $1.5 billion to shareholders in the form of dividends and share repurchases, and the company has consistently churned out returns for its shareholders since the 1999-2001 internet stock bubble collapse. As we detailed in another article, Qualcomm has a significant number of 3G and 4G/LTE patents. According to a recent research finding, Qualcomm holds 21 percent of the necessary 4G patents, second only to LG Electronics Inc. (KRX:066570), which holds 23 percent. This is a reassuring finding considering that most of the world is still upgrading to 3G. Qualcomm’s long-term profitability is reinforced by its consistent ethic of maintaining a minimal debt structure (its debt/capital is less than 4 percent). We also like Qualcomm’s involvement in multiple operating systems and both major mobile solutions—tablet and phone. Long-term, Qualcomm stands to benefit from whatever the competitive outcome is among its many OEMs.

Barrick Gold

Barrick Gold Corporation (NYSE:ABX) is a gold mining and sales company with operations in North America, South America, and the Australian Pacific. Gold is a decent hedge against currency inflation and a good part of a balanced portfolio; additionally, the company’s low beta of 0.4 indicates the company’s relatively low covariance with the broader market. As of the end of 2011, the company had 140 million ounces of proven or probable gold reserves and 12.7 billion pounds of proven copper reserves. The company had lack-luster second quarter earnings performance, falling short of consensus analyst EPS estimates by 17 percent—a disappointment broadly shared with the rest of the gold mining sector. The resulting price depression makes it a good time to initiate a long-term position; shares are trading at 8.1 times forward earnings estimates, which is below the materials sector’s average forward P/E of 12.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

6 Films About the Financial World You Need To Watch (While “The Wolf” is Not Around)

Warren Buffett and Billionaires Are Crazy About These 7 Stocks

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top Businesses to Invest In

Top 5 Things You Might Be Doing Wrong With Your Business

Top 5 Strategic Technology Trends in 2014

Top Rags to Riches Stories

Parenting Behavior That Promotes Future Leaders

Top 5 Mistakes Made by Small Businesses

Top 5 Most Common and Potentially Devastating Financial Blunders

Top 5 Highest Paying Jobs for Web Designers

Top 6 Most Respected Professions that Also Pay Well

Top 5 Pitfalls Investors Should Avoid

Top 6 Lawyers and Policy Makers Under 30

Top 6 New Year’s Resolutions for Entrepreneurs

Top 7 Locations to Check in on Facebook

Top 5 Mistakes made by Rookie eBay Sellers

Top 7 eBook Publishers in 2013

Top 6 Health Industry Trends in 2014

5 Lessons for Entrepreneurs from Seth Godin

Top 5 Success Tips from Jordan Belfort – the Wolf of Wall Street

Best Master’s in Finance Degree Programs

Top 6 Earning Celebrities Over 50

The most expensive sports to play

Top 7 Earning Celebrities Under 25

Best 7 Online Courses to Take: Free Finance MOOCs

Top 6 Bad Habits that Promote Failure

20 Most Valuable Soccer Teams in the World in 2013

12 Most Expensive Countries for Foreign Students

Top 30 Most Influential Women in the World

Top 20 Most Expensive New Year Eve Shows

Top 5 Best Vocational Careers

Top 10 Jobs for 2014 by Salary Gain (Predictions)

Top 5 Digital Trends for 2014

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!