Ken Fisher’s started his fund back in 1979 with only $250. Since then, the fund’s assets under management have grown exponentially to $48 billion, and Fisher has become quite rich himself in the process, standing today as a billionaire worth around $2.8 billion. Without further ado, let’s take a closer look at Fisher’s top tech picks of Amazon.com, Inc. (NASDAQ:AMZN), Apple Inc. (NASDAQ:AAPL), Visa Inc (NYSE:V), Microsoft Corporation (NASDAQ:MSFT), and Comcast Corporation (NASDAQ:CMCSA).
First a little about our site. Insider Monkey tracks hedge fund sentiment. Most investors ignore hedge funds’ moves because as a group their average net returns trailed the market since 2008 by a large margin. Unfortunately, most investors don’t realize that hedge funds are hedged and they also charge an arm and a leg, so they are likely to underperform the market in a bull market. We ignore their short positions and by imitating hedge funds’ stock picks independently, we don’t have to pay them a dime. Our research has shown that hedge funds’ long stock picks generate strong risk adjusted returns. For instance the 15 most popular small-cap stocks outperformed the S&P 500 Index by an average of 95 basis points per month in our back-tests spanning the 1999-2012 period. We have been tracking the performance of these stocks in real-time since the end of August 2012. After all, things change and we need to verify that back-test results aren’t just a statistical fluke. We weren’t proven wrong. These 15 stocks managed to return 102% over the last 37 months and outperformed the S&P 500 Index by 53 percentage points (see more details here).
#5 Comcast Corporation (NASDAQ:CMCSA)
Shares held (as of September 30): 12.24 million
Total Value (as of September 30): $696.31 million
Percent of Portfolio (as of September 30): 1.45%
It’s the age old question. Which is more important, distribution or content? As one of the world’s largest content and cable providers, Comcast Corporation (NASDAQ:CMCSA) has both. If more people leave cable in favor of internet technologies, Comcast Corporation can offset its declining cable revenue by realizing more from content licensing deals. At a forward P/E of 16.7, the company is reasonably priced. The company could pay a higher attractive dividend yield with its cash flow, however. Lansdowne Partners owned 23.81 million shares at the end of June.
#4 Microsoft Corporation (NASDAQ:MSFT)
Shares held (as of September 30): 17.98 million
Total Value (as of September 30): $795.63 million
Percent of Portfolio (as of September 30): 1.66%
Microsoft Corporation (NASDAQ:MSFT) is no longer the dominant tech company that it once was. The Department of Justice lawsuit a decade and half ago and Steve Jobs made sure of that. The good news is that Microsoft is still fantastically profitable, having made $22 billion in net income in 2014. Given that over a billion people around the world regularly use Microsoft Office and Windows, Microsoft products are still in demand, and the company is making solid inroads in future growth categories such as the cloud and virtual reality. With a dividend yield of 3% and forward P/E of 15.68, shares are cheap. The company also turned in a solid second quarter earnings report. Jeffrey Ubben‘s ValueAct Capital owned 75.27 million shares of Microsoft at the end of the second quarter.