The Bill and Melinda Gates Foundation’s Stock Picks Include Berkshire Hathaway Inc. (BRK.B)

Page 1 of 2

The Bill and Melinda Gates Foundation Trust is a long term investor whose capital is used to fund ongoing foundation activities and invested to sustain the foundation for a long period of time. It is one of the investors we track in our database of quarterly 13F filings, which we use to help us develop investment strategies (for example, we have found that the most popular small cap stocks among hedge funds outperform the S&P 500 by an average of 18 percentage points per year). Even though its most recent 13F filing discloses many of its long equity positions from the end of March, the trust actually hadn’t changed most of these positions during the first quarter of 2013 and so we would assume that it still owns quite a bit of what had been its largest holdings at that time. Read on for our quick take on its top five picks or check out the full list of stocks the trust reported owning.

The trust, which is managed by Michael Larson, reported a position of almost 81 million Class B shares of Berkshire Hathaway Inc. (NYSE:BRK.B). Gates and Berkshire Hathaway Inc. (NYSE:BRK.B) head Warren Buffett have bonded on a number of topics and issues, and apparently the trust is a strong believer that both Buffett and his hand-picked successors will prove able to identify attractive investment opportunities over the long term even given their massive size (find Buffett’s favorite stocks). In addition to the succession at Berkshire Hathaway Inc. (NYSE:BRK.B), however, investors may also be concerned with the premium P/B ratio of 1.5.

Bill GatesLarson and his team didn’t just own Berkshire Hathaway Inc. (NYSE:BRK.B), they’ve also copied one of Buffett’s long term favorite stock picks, The Coca-Cola Company (NYSE:KO), with about 34 million shares in their portfolio. While Coca-Cola is a somewhat popular defensive stock, with a beta of 0.3 and a dividend yield of 2.7%, its business has been struggling going by recent reports. At a valuation of 21 times trailing earnings, markets are pricing in quite a bit of future earnings growth and so given this recent financial performance it doesn’t seem like a good buy right now.

Latin American Coca-Cola bottler and distributor Coca-Cola FEMSA, S.A.B. de C.V. (ADR) (NYSE:KOF) was another of the foundation’s top picks with the filing disclosing ownership of 6.2 million shares. Coca-Cola Femsa is even less sensitive to the broader economy than its related company, with a beta of only 0.1. However, it too carries something of a premium valuation, with trailing and forward earnings multiples of 28 and 22 respectively. As with Coca-Cola itself, recent performance has not been in line with market implied expectations with earnings declining in its last quarterly report compared to Q1 2012.

Page 1 of 2
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

The 10 Countries with the Highest Suicide Rates

The 10 Most Technologically Advanced Countries in the World

The 10 Safest Countries in the World to Live in Peace

The 10 Top Selling Smartphones in the World 2014

The 12 Biggest Shopping Centers in the World

The 10 Friendliest Countries in the World

Qihoo 360 Technology Co Ltd (QIHU), Actavis plc (ACT), Yahoo! Inc. (YHOO) Among 20 Long Ideas from Sohn Canada

The 10 Laziest Countries in the World

The 10 Most Polluted Countries in the World

The 10 Most Dangerous Cities in America 2014

The Top 10 Gold Producing Countries in the World

The 10 Tallest Buildings in the World

The 10 Richest Stand Up Comedians in the World

The 10 Fattest Countries in the World

The 5 Best Summer Jobs for Teens

The 10 Most Religious Countries in the World Keeping the Faith

The 10 Most Educated Countries in the World

The 10 Most Popular Cell Phones in the World

The 10 Drunkest Countries in the World

The 10 Most Expensive Private Schools in the World

The 10 Smallest Countries in the World

Walking Dead Season 5 Spoilers You’ll Wish You Didn’t Know

The 10 Poorest Countries in the World

The 10 Greenest Countries in the World

The Top 10 Countries with the Highest Population in the World

The 10 Most Visited Countries in the World

The Top 10 Star Wars Characters in the Iconic Series

The 10 Most Expensive Android Phones in the World

5 Reasons Why The Illuminati Is Real and a Threat to Society

The 6 Scariest Halloween Costumes Ever Screamed At

The 4 Biggest Hedge Fund Managers in the World Today

The 15 Most Densely Populated Countries in the World

The 10 Biggest Tea Drinking Countries in the World

Top 6 Ways to Improve Your Checkout Process and Close Sales

The 5 Most Profitable Online Businesses You Can Start Today

The 20 Most Profitable Hospitals in the US

The 5 Most Profitable Home Businesses to Start

The 7 Teams that Will Win the Stanley Cup in 2015

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

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!