In this article, we will look at 10 blue-chip stocks to buy according to billionaire Ken Fisher. If you want to skip reading about Ken Fisher’s insights on the current market situation and his hedge fund’s recent performance, you can go directly to 5 Blue Chip Stocks to Buy According to Billionaire Ken Fisher.
Ken Fisher is an American billionaire investor, author, financial analyst, and founder and manager of Fisher Asset Management. According to Forbes, as of 2022, Mr. Fisher has a net worth of $5.1 billion. Ken Fisher is known for being a contrarian and challenging the broad view of investors and analysts. On May 24, Mr. Fisher shared his insights on the current market situation in an interview with Fox Business host Neil Cavuto. Ken Fisher argued that the current geopolitical situation and macroeconomic headwinds have left investors puzzled. He mentioned seven “scary” stories that are impacting investors’ decisions among which were the lockdowns in China due to another outbreak of Covid, the Ukraine crisis, Fed tightening, and rising interest rates. Mr. Fisher has a bullish outlook on growth stocks, typically his hedge fund’s tech investments, and was reported to have said:
“In this market what I think is happening, not every day, but most of the time, when you have a big down day, tech goes down more than the market. When you have a big up day, yesterday aside, tech goes up more than the market.”
Growth Versus Value or Up Versus Down
Mr. Fisher explained how investors should position their portfolio given the current economic situation in a video he uploaded to his YouTube channel. He drew comparisons between the performance of growth and value stocks in correlation to market sentiment. Mr. Fisher drew a scatterplot that he shared on his Twitter account, in which he extrapolated data points to support his hypothesis:
On most up days, growth beats value & the reverse for down days, particularly big days. Not G versus V but up or down market. If bearish bet value. If bullish, growth. It’s really market direction, pure & simple.
Fisher Asset Management: Returns and Recent Portfolio
Forbes found that Ken Fisher’s public stock picks consistently outperformed the U.S. broad market indices by an average of 4.2% on an annualized basis between 1998 and 2016. In the first quarter of 2020, Fisher Asset Management posted quarter-on-quarter gains of 33.16%. Fisher Asset Management’s returns dipped to -3.05% in the first quarter of 2021 compared to Q1 2020, and as of the first quarter of 2022, the fund’s quarter-on-quarter returns are down 19.65%. However, Fisher Asset Management has consistently outperformed the S&P 500 from the third quarter of 2017 up till the fourth quarter of 2021.
In the first quarter of 2022, Fisher Asset Management added 99 stocks to its portfolio, exited 89 positions, raised its stakes in 442 companies, and reduced its stakes in 385 companies. The fund has a top 10 holdings concentration of 31.34% and has the majority of its investments concentrated in the Technology, Healthcare, Services, and Basic Materials segments. As of March 31, 2022, Ken Fisher manages $169.49 billion in 13F securities through his hedge fund.
Some of the top blue-chip stocks to buy according to Fisher Asset Management are Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), and Amazon.com, Inc. (NASDAQ:AMZN). Read on to explore more blue-chip stocks that billionaire Ken Fisher is bullish on.
Our Methodology
To determine the 10 blue-chip stocks to buy according to billionaire Ken Fisher, we reviewed Fisher Asset Management’s Q1 2022 investment portfolio. We identified blue-chip companies that the hedge fund held stakes in and ranked them in increasing order of Fisher Asset Management’s share in the company.
Blue Chip Stocks to Buy According to Billionaire Ken Fisher
10. Freeport-McMoran Inc. (NYSE:FCX)
Fisher Asset Management’s Stake Value: $2,524,330,000
Percentage of Fisher Asset Management’s 13F Portfolio: 1.48%
Number of Hedge Fund Holders: 68
On June 9, Credit Suisse analyst Curt Woodworth upgraded Freeport-McMoRan Inc. (NYSE:FCX) to Neutral from Underperform with a price target of $38, up from $32. The analyst believes copper prices are likely to remain elevated in the medium term and that the risk/reward ratio for the commodity is bullish, which makes Freeport-McMoran Inc.’s (NYSE:FCX) risk/reward ratio “more neutral”.
On April 21, Freeport-McMoran Inc. (NYSE:FCX) released earnings for the fiscal first quarter of 2022. The company reported earnings per share of $1.07 and exceeded expectations by $0.15. Freeport-McMoran Inc. (NYSE:FCX) generated a revenue of $6.60 billion for the quarter, up 36.14% year over year, and ahead of expectations by $148.02 million.
Freeport-McMoran Inc. (NYSE:FCX) is ranked thirteenth among Fisher Asset Management’s top 13F holdings. In the first quarter of 2022, the hedge fund raised its stakes in the company by 4%, bringing them to $2.52 billion. The investment covers 1.48% of Fisher Asset Management’s 13F portfolio and makes Freeport-McMoran Inc. (NYSE:FCX) one of the best blue-chip stocks to buy according to billionaire Ken Fisher.
At the end of the first quarter of 2022, 68 hedge funds were long Freeport-McMoran Inc. (NYSE:FCX) with stakes worth $4.10 billion. This is compared to 66 hedge funds in Q4 2021 with stakes worth $3.77 billion. The hedge fund sentiment for the stock is positive.
Here is what Horizon Kinetics LLC, an investment management firm, had to say about Freeport-McMoran Inc. (NYSE:FCX) in its fourth-quarter 2021 investor letter:
“Those were some ideas about copper demand. Here are some specifics about supply. Global copper mine production in the 10 years from 2005 to 2015 rose 2.45% annually. In the next 5 years, to 2020, it increased by only 0.9% annually. Even ignoring the 2020 pandemic year, for the 4 years from to 2019, the expansion rate was 1.66%. We already have the historical context for this: the commodity price collapse prior to 2015, from a position of excess capacity.
What producers must do in that situation, because they have high fixed costs and debt expense, is curtail their exploration and development expenditures and reduce operating costs. They rely on existing mines, instead, and on their highest-grade ores and lowest-cost production. They might not actually reduce current production, but they aren’t replacing the reserves that are being slowly drawn down. You can see this at work at the individual company level.
Freeport-McMoRan will illustrate. It is the world’s third-largest copper producer, closely following Chile’s Codelco and Australia’s BHP Group. In 2014, even though Freeport sold more copper than the prior year, its revenues dropped by over 25%, and it went from $4.8 billion of operating earnings (a 22% margin) to a $(0.2) billion loss. The company’s capital expenditures peaked in 2014 at $3.86 billion and will be about $1.72 billion in 2021, meaning the company is spending 55% less now than it was seven years ago. In inflation-adjusted terms, it’s spending 61% less today than seven years ago…” (Click here to see the full text)
“Those were some ideas about copper demand. Here are some specifics about supply. Global copper mine production in the 10 years from 2005 to 2015 rose 2.45% annually. In the next 5 years, to 2020, it increased by only 0.9% annually. Even ignoring the 2020 pandemic year, for the 4 years from to 2019, the expansion rate was 1.66%. We already have the historical context for this: the commodity price collapse prior to 2015, from a position of excess capacity.
What producers must do in that situation, because they have high fixed costs and debt expense, is curtail their exploration and development expenditures and reduce operating costs. They rely on existing mines, instead, and on their highest-grade ores and lowest-cost production. They might not actually reduce current production, but they aren’t replacing the reserves that are being slowly drawn down. You can see this at work at the individual company level.
Freeport-McMoRan will illustrate. It is the world’s third-largest copper producer, closely following Chile’s Codelco and Australia’s BHP Group. In 2014, even though Freeport sold more copper than the prior year, its revenues dropped by over 25%, and it went from $4.8 billion of operating earnings (a 22% margin) to a $(0.2) billion loss. The company’s capital expenditures peaked in 2014 at $3.86 billion and will be about $1.72 billion in 2021, meaning the company is spending 55% less now than it was seven years ago. In inflation-adjusted terms, it’s spending 61% less today than seven years ago…” (Click here to see the full text)
9. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Fisher Asset Management’s Stake Value: $2,666,562,000
Percentage of Fisher Asset Management’s 13F Portfolio: 1.57%
Number of Hedge Fund Holders: 83
On May 3, Advanced Micro Devices, Inc. (NASDAQ:AMD) reported earnings for the first quarter of fiscal year 2022. The company reported a revenue of $5.89 billion, up 70.89% year over year, and outperformed market consensus by $313.37 million. The company’s earnings per share came in at $1.13, ahead of Wall Street expectations by $0.20. Moreover, as of June 10, Advanced Micro Devices, Inc. (NASDAQ:AMD) has returned 16.27% to investors over the past twelve months.
Shares of Advanced Micro Devices, Inc. (NASDAQ:AMD) climbed by 6% shortly after the company posted its gains for the fiscal first quarter of 2022 and raised its full-year guidance. On May 3, the company expanded its fiscal year 2022 revenue view to roughly $26.3 billion, up 60% year over year, and up 31% from its prior guidance of $21.5 billion.
This June, Benchmark analyst Cody Acree raised his price target on Advanced Micro Devices, Inc. (NASDAQ:AMD) to $135 from $125 and reiterated a Buy rating on the shares.
Hedge funds are raising their stakes in Advanced Micro Devices, Inc. (NASDAQ:AMD). In the first quarter of 2022, 83 hedge funds were bullish on Advanced Micro Devices, Inc. (NASDAQ:AMD) with stakes worth $6.94 billion. This is compared to 69 positions in the previous quarter with stakes worth $6.74 billion.
Fisher Asset Management increased its stakes in Advanced Micro Devices, Inc. (NASDAQ:AMD) by 23% in Q1 2022, bringing them to $2.66 billion, which covers 1.57% of its 13F portfolio. Fisher Asset Management is the top stakeholder in the company.
Carillon Tower Advisers, an investment management firm, recently published its “Carillon Eagle Mid Cap Growth Fund” fourth-quarter 2021 investor letter in which it mentioned Advanced Micro Devices, Inc. (NASDAQ:AMD). Here is what the firm had to say:
“Advanced Micro Devices (AMD) supplies semiconductor chips for central processing units (CPUs) and graphic processing units (GPUs). The firm has been gaining share against its primary competitor in the datacenter server CPU space, as this rival has been unable to match the design and manufacturing capabilities of AMD and its partners. Investors are also looking forward to the closing of the previously announced merger with a semiconductor manufacturer that is another one of the portfolio’s holdings. The merger will increase AMD’s capabilities in the Field Programmable Gate Array (FPGA) chip space, and the combined company should possess the potential to win additional market share in the datacenter chip market.”
8. American Express Company (NYSE:AXP)
Fisher Asset Management’s Stake Value: $2,933,385,000
Percentage of Fisher Asset Management’s 13F Portfolio: 1.73%
Number of Hedge Fund Holders: 69
American Express Company (NYSE:AXP) is a leading global credit card payment solutions and travel services provider. As of Q1 2022, Fisher Asset Management owns over 15.68 million shares of the company which amounts to a stake of $2.93 billion. Fisher Asset Management is the second-largest shareholder in the company and the investment covers 1.73% of its 13F portfolio. American Express Company (NYSE:AXP) is ranked tenth among the fund’s top holdings, and the stock is one of the best blue-chip stocks to buy according to billionaire Ken Fisher.
On June 10, American Express Company (NYSE:AXP) announced that it is partnering up with Abra, an emerging digital wallet solutions provider, to add a crypto-linked credit card to its network which will allow U.S. users to earn back crypto on any purchase.
This April, RBC Capital analyst Jon Arfstrom raised his price target on American Express Company (NYSE:AXP) to $200 from $195 and reiterated a Sector Perform rating on the shares, noting that the company’s earnings for Q1 2022 were strong.
At the end of the first quarter of 2022, 69 hedge funds held stakes in American Express Company (NYSE:AXP) worth $33.18 billion. This is compared to 64 hedge funds in Q4 2021 with stakes worth $28.97 billion. The hedge fund sentiment for the stock is positive.
In addition to Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), and Amazon.com, Inc. (NASDAQ:AMZN), another blue-chip stock Ken Fisher is bullish on is American Express Company (NYSE:AXP).
7. Visa Inc. (NYSE:V)
Fisher Asset Management’s Stake Value: $2,944,987,000
Percentage of Fisher Asset Management’s 13F Portfolio: 1.73%
Number of Hedge Fund Holders: 159
On April 26, Visa Inc. (NYSE:V) released earnings for the second quarter of fiscal year 2022 in which it came in ahead of Wall Street expectations. The company reported earnings per share of $1.79 and beat estimates by $0.14. Visa Inc. (NYSE:V) reported revenue of $7.19 billion, up 25.48% year over year, and outperformed consensus by $366.88 million. This May, Visa Inc. (NYSE:V) was added to BofA’s U.S. 1 list which keeps track of companies from the universe of “Buy-rated”.
On May 17, Goldman Sachs analyst Will Nance initiated coverage of Visa Inc. (NYSE:V) with a Buy rating and a $282 price target, implying a 43% upside. Nance also added the stock to Goldman Sachs’ America’s Conviction List.
As of Q1 2022, the fund owns 13.27 million shares of Visa Inc. (NYSE:V) which amounts to a stake of $2.94 billion in the company. Visa Inc. (NYSE:V) is the top-ninth holding of Fisher Asset Management and also one of the best blue-chip stocks to buy according to billionaire Ken Fisher.
At the end of Q1 2022, 159 hedge funds were bullish on Visa Inc. (NYSE:V) with stakes worth $28.07 billion. This is compared to 142 hedge funds in Q4 2021 with stakes worth $29.29 billion.
Polen Capital recently published its “Polen Global Growth Fund” first-quarter 2022 investor letter and mentioned Visa Inc. (NYSE:V) in it. Here is what the firm said:
“We added to both Visa and Mastercard during the final quarters of 2021, based on the belief that both businesses were trading at attractive prices and poised to deliver, double-digit returns over the next three to five years. Cross-border transactions–a highly profitable business segment for both companies–represent roughly 10% of Visa and Mastercard’s volumes and 25% of their gross revenues, so lockdowns have severely impacted this segment due to stifled travel. While it was impossible to know when people would begin traveling again, we accepted this reality with the belief that travel would eventually return. Both companies have commented that as soon as a country or geography reopens, cross-border volumes reignite, amplifying each business’s growth and profitability. We think these near- term headwinds have created an attractive long-term investment opportunity.”
6. Adobe Inc. (NASDAQ:ADBE)
Fisher Asset Management’s Stake Value: $2,980,917,000
Percentage of Fisher Asset Management’s 13F Portfolio: 1.75%
Number of Hedge Fund Holders: 93
At the close of Q1 2022, 93 hedge funds were long Adobe Inc. (NASDAQ:ADBE) with stakes worth $8.90 billion. Of these, $2.98 billion were of Fisher Asset Management, which owns 6.54 million shares of the company as of March 31, 2022. The investment covers 1.75% of Ken Fisher’s 13F portfolio.
On March 22, Adobe Inc. (NASDAQ:ADBE) released earnings for the fiscal first quarter of 2022. The company reported revenue of $4.26 billion for the quarter, up 9.14% year over year, coming ahead of expectations by $23.79 million. Adobe Inc. (NASDAQ:ADBE) reported earnings per share of $3.37 and outperformed EPS estimates by $0.03.
This June, Mizuho analyst Gregg Moskowitz trimmed his price target on Adobe Inc. (NASDAQ:ADBE) to $530 from $600 but maintained a Buy rating on the shares.
Adobe Inc. (NASDAQ:ADBE) is ranked seventh on Fisher Asset Management’s 13F portfolio and the hedge fund is also the top stakeholder in the company. Adobe Inc. (NASDAQ:ADBE) is one of the top blue-chip stocks to buy according to billionaire Ken Fisher.
Mr. Fisher’s hedge fund has sizeable stakes in Adobe Inc. (NASDAQ:ADBE). Other top blue-chip stocks to buy according to Fisher Asset Management are Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), and Amazon.com, Inc. (NASDAQ:AMZN).
Here is what Polen Capital had to say about Adobe Inc. (NASDAQ:ADBE) in its “Polen Global Growth Fund” first-quarter 2022 investor letter:
“Adobe is a prime example of the COVID-19 air pocket. Adobe continues to compound capital at high rates and exhibit increasing returns to scale. In the case of Adobe, reported growth appears to have decelerated significantly. However, when accounting for foreign exchange impacts and for their fiscal year 2021 having 53 weeks, the adjusted revenue growth was 17% year over year, which is fully in line with their typical growth rates. The 53rd week of the fiscal year 2021 added $267m to total revenue, creating an eight-percentage point difference in reported and adjusted revenue growth. We applaud management’s recent roll- out of Creative Cloud Express to tap into the non-professional market, as well as increasing price in 2022, which we expect to materialize in the back half of the year.”
Click to continue reading and see 5 Blue Chip Stocks to Buy According to Billionaire Ken Fisher.
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Disclose. None. 10 Blue Chip Stocks to Buy According to Billionaire Ken Fisher is originally published on Insider Monkey.
