Wal-Mart Stores, Inc. (WMT), Johnson & Johnson (JNJ): Buffett & Soros Are Bullish Here

Page 1 of 2

Billionaire George Soros is best known for his success as a global macro investor, particularly in currency instruments, but his hedge fund Soros Fund Management is also heavily invested in equities (see a history of the fund’s stock picks). In mid August the fund filed its quarterly 13F with the SEC, disclosing many of its long equity positions as of the end of June. While many investors argue that the information in 13Fs isn’t recent enough to be of any use, we’ve actually found that the most popular small cap stocks among hedge funds earn an average excess return of 18 percentage points per year (learn more about our small cap strategy) with our own portfolio following this strategy having beaten the market by 33 percentage points in the last 11 months.

Of course, we can also look at George Soros’s stock picks and treat them as free initial investment ideas. To refine them further we can also look for stocks which Warren Buffett’s holding company Berkshire Hathaway reported owning in its own filing (find Buffett’s favorite stocks), as Berkshire has been a successful investor over the long term. Read on for our quick take on five stocks which both Berkshire and Soros’s hedge fund reported owning in their most recent 13Fs.

Both of these investors owned Wal-Mart Stores, Inc. (NYSE:WMTat the end of the second quarter, with Berkshire Hathaway having more than $3.7 billion invested in the big-box discount retailer. After what had apparently been a terrible start to its fiscal year, Wal-Mart Stores, Inc. (NYSE:WMT) has at least experienced some degree of growth in its first couple quarters compared to a year ago. The trailing P/E of 14 shows that markets expect weak numbers from the company going forward. We would note that Wal-Mart Stores, Inc. (NYSE:WMT)’s beta is only 0.3, demonstrating a lack of dependence on overall economic conditions.

hedge funds vs. mutual fundsAnother top Buffett pick which was also present in Soros Fund Management’s portfolio is DIRECTV (NASDAQ:DTV). The satellite TV company is also trading in value territory, with trailing and forward P/Es of 12 and 10 respectively; clearly, it is another business where investors are highly skeptical of the future. Sales have been up nicely, but these funds have been consumed by higher costs resulting in small decreases in operating income last quarter compared to Q2 2012. The EV/EBITDA multiple of 6.5x is also fairly low, possibly due to concerns about competition from cable companies in the premium market.

Page 1 of 2
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

The Most Successful Reality TV Stars

Cheapest Cities to Visit in the US

Most Expensive Summer Camps

Most Expensive Animals in the World

Most Expensive Specialty Crops in the World

Movies That Took Ages to Make

The Longest Hollywood Films Ever Made

Most Expensive Concert Stages

The Richest Bands of all Time

10 Most Corrupt Countries 2013 List

10 Countries with the Highest Quality of Life Index

Most Expensive Mattresses in the World

5 Smallest Countries by Land Area

The Ultimate Heartbreak Songs

Richest Teenagers in the World

10 Most Haunted Places in America

10 Best Places to Retire in Florida East Coast

Top 10 Places to See Before You Die

Top 8 Countries in the World Where Justice Prevails

10 Richest States in America

15 Wealthiest Countries in the World

Richest Singers in the World

Most Expensive Tasting Menu in New York City

Most Expensive Baby Items in the World

Most Expensive Hotel Suites in Vegas

Most Expensive Brunch in New York City

Most Expensive Beef Cuts in the World

25 Best Colleges to Get a Job

Top 10 US Supermarkets

The 25 Most Dangerous Cities in the World to Visit

Most Expensive Xbox Games

Top 11 Cities Where Billionaires Live

Top 10 Most Charitable Companies in America

Most Expensive Seafood in the World

The 10 Wildest Conspiracy Theories

The 10 Best Job Markets in the US

Top 10 Accounting Scandals of All Time

The 25 Biggest Cities in the World

Top 10 Best Paying Virtual Jobs

Most Expensive Leather Shoes in the World

Top 6 Things to Buy in March

The 10 Most Stressful Jobs in America – 2014 List

Top 10 Jobs for Introverted People

Top 10 Honeymoon Destinations in the World

Top 10 Highest Paying Jobs in the World

Most Expensive Day-Care in New York City

The 10 Cheapest Places to Retire Abroad

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!