Renaissance Technologies’s Long Term Stock Picks Include McDonald’s Corporation (MCD)

Another low beta stock that Renaissance has liked over the long term is Colgate-Palmolive Company (NYSE:CL). The personal products company trades at 24 times trailing earnings, which seems high considering how mature its business is; revenue only rose 3% in the first quarter of 2013 versus a year earlier, with net income actually falling. The sell-side expects improvements on the bottom line next year, but even the forward earnings multiple of 19 seems expensive. Lansdowne Partners, which is run by Sir Paul Ruddock and Steve Heinz, owned 3.9 million shares of Colgate-Palmolive Company (NYSE:CL) at the end of the first quarter of 2013.

McDonald’s Corporation (NYSE:MCD) has been another of the fund’s long term stock picks with 4.6 million shares in its portfolio per the most recent filing and 1.8 million shares two years prior. The stock carries trailing and forward P/Es of 19 and 16 respectively, a discount to many other quick services restaurants but expensive in absolute terms as the company has shown little change on both top and bottom lines. We’d note that it is another potential defensive pick with a beta of 0.3. The Bill and Melinda Gates Foundation Trust was another major shareholder in McDonald’s Corporation (NYSE:MCD) (research more stocks the trust owns).

Renaissance disclosed ownership of 2.6 million shares of Novo Nordisk A/S (ADR) (NYSE:NVO), a Danish pharmaceutical company with a market capitalization of $89 billion. That places its valuation at 23 times its trailing earnings. While recent reports have shown significant increases in sales and net income,  analysts apparently expect only limited growth in profits for the near to medium term. Fisher Asset Management reported owning 2.7 million shares of Novo Nordisk A/S (ADR) (NYSE:NVO) at the end of March 2013; that asset management firm is run by billionaire Ken Fisher (see more stocks Fisher liked).

Disclosure: I own no shares of any stocks mentioned in this article.