In this article, we discuss 5 stocks to buy according to BlueSpruce Investments. If you want to see some other important stocks in the fund’s Q1 portfolio, go directly to 10 Stocks to Buy According to BlueSpruce Investments.
5. Visa Inc. (NYSE:V)
BlueSpruce Investments’ Stake Value: $599,415,000
Percentage of BlueSpruce Investments’ Portfolio: 9.72%
Number of Hedge Fund Holders: 159
Visa Inc. (NYSE:V) is one of BlueSpruce Investments’ favorite stocks. In the first quarter of 2022, the fund increased its hold in the company by 89% to 2.70 million shares worth $599.42 million. Visa Inc. (NYSE:V) has featured on BlueSpruce Investments’ portfolio since the fourth quarter of 2016.
At the end of Q1 2022, 159 hedge funds tracked by Insider Monkey were bullish on Visa Inc. (NYSE:V), up from 142 in the quarter earlier. The collective value of these stakes is over $28.08 billion. Will Nance of Goldman Sachs initiated coverage of Visa Inc. (NYSE:V) on May 17, assigning a Buy rating and a $282 price target, representing a 43% upside.
Baron Funds mentioned Visa Inc. (NYSE:V) in its Q1, 2022 investor letter. Here is what the firm has to say:
“Shares of global payment network Visa, Inc. (NYSE:V) were up 2.5% on strong quarterly results with 24% revenue growth and 27% EPS growth. Payment volume grew 20% with notable strength in cross-border volumes as travel activity rebounded from depressed levels. Management raised full-year guidance to reflect high-teens revenue growth. Shares also likely benefited from a “flight to safety” during a volatile quarter for equities. We continue to own the stock due to Visa’s long runway for growth underpinned by the continued migration from cash transactions to card/digital and strong competitive advantages, operating in a duopoly with Mastercard.”
4. Alphabet Inc. (NASDAQ:GOOG)
BlueSpruce Investments’ Stake Value: $639,744,000
Percentage of BlueSpruce Investments’ Portfolio: 10.37%
Number of Hedge Fund Holders: 160
On June 2, Piper Sandler analyst Thomas Champion reiterated an Overweight rating on Alphabet Inc. (NASDAQ:GOOG) but reduced his price objective to $2,775 from $2,900. Champion reduced forecasts across the board in the internet business.
At the end of March 2022, 160 hedge funds tracked by Insider Monkey were bullish on Alphabet Inc. (NASDAQ:GOOG), up from 158 in the previous quarter. These stakes hold a collective value of roughly $29.68 billion.
The stock is a new arrival in BlueSpruce Investments’ portfolio, as it bought about 230,012 shares of Alphabet Inc. (NASDAQ:GOOG), worth $639.74 million. This represented 10.37% of the investment portfolio of the hedge fund.
Here is what Baron Funds had to say about Alphabet Inc. (NASDAQ:GOOG) in its first-quarter 2022 investor letter:
“We have modestly reduced the size of our position in Alphabet Inc. (NASDAQ:GOOG) (from 6.5% at the end of the fourth quarter of 2021 to 5.3% as of the end of the first quarter of 2022), after the stock rallied 64% in 2021 and continued outperforming during the first quarter, declining just 3%.”
3. Microsoft Corporation (NASDAQ:MSFT)
BlueSpruce Investments’ Stake Value: $700,653,000
Percentage of BlueSpruce Investments’ Portfolio: 11.36%
Number of Hedge Fund Holders: 259
After adjusting expectations lower to reflect the company’s new outlook given further foreign exchange headwinds, Jefferies analyst Brent Thill reiterated a Buy rating on Microsoft (NASDAQ:MSFT) and trimmed his price objective to $320 from $325 on June 13.
Microsoft Corporation (NASDAQ:MSFT) experienced a decline in hedge fund interest in Q1 2022, as 259 hedge funds tracked by Insider Monkey reported owning stakes in the company at the end of the period, down from 262 in the preceding quarter. The aggregate value of stakes held by 259 hedge funds stood at over $65.64 billion.
BlueSpruce Investments started building its position in Microsoft Corporation (NASDAQ:MSFT) during the first quarter of 2020, buying shares worth over $258.95 million. The hedge fund increased its stakes in the company by 30%, owning shares worth roughly $700.65 million at the end of Q1 2022. The company represented 11.36% of the hedge fund’s 13F portfolio.
Here is what Baron Opportunity Fund has to say about Microsoft Corporation (NASDAQ:MSFT) in its Q1 2022 investor letter:
“Shares of mega-cap software company Microsoft Corporation (NASDAQ:MSFT) pulled back with the broader software sector. The company posted another solid quarter, highlighted by total revenues increasing 20% and Microsoft Cloud revenues, now 45% of total revenues, growing 32%. These results were driven, in large part, by strong demand for large Azure contracts. We believe Microsoft can compound revenue in the low double digits for the next three years, underpinned by its expansion in its total addressable market and market share gains.”
2. Fiserv, Inc. (NASDAQ:FISV)
BlueSpruce Investments’ Stake Value: $816,964,000
Percentage of BlueSpruce Investments’ Portfolio: 13.25%
Number of Hedge Fund Holders: 58
Fiserv, Inc. (NASDAQ:FISV) is a company that specializes in financial technology. Ivan Feinseth, a Tigress Financial analyst, boosted his price objective on Fiserv, Inc. (NASDAQ:FISV) to $152 from $150 on May 27 and reaffirmed his Buy rating on the stock.
BlueSpruce Investments initiated its position in Fiserv, Inc. (NASDAQ:FISV) during the fourth quarter of 2019, purchasing shares worth over $221.72 million. At the end of Q1 2022, the hedge fund held stakes valued at $816.96 million in the company. Fiserv, Inc. (NASDAQ:FISV) represented 13.25% of the hedge fund’s 13F portfolio.
ClearBridge Investments mentioned Fiserv, Inc. (NASDAQ:FISV) in its Q4 2021 investor letter. Here is what the fund said:
“While the threat of disruption risk to these established payment companies should not be taken lightly, it is important to note that many of these emerging disruptors are small relative to the massive global payments network and heavily reliant on the very payment infrastructure they are trying to disrupt. This led us to initiate a position in Fiserv, whose stock dropped to a level that embedded projections for negative long-term growth despite no current evidence of disruption. We think Fiserv will continue to grow despite perceived disruption risks given its scale and efficiency. Fiserv also owns cloud-based payments hardware and software system Clover, which is both bigger and faster growing than Square; this provides an additional degree of protection against further disruption risk.
1. Mastercard Incorporated (NYSE:MA)
BlueSpruce Investments’ Stake Value: $940,801,000
Percentage of BlueSpruce Investments’ Portfolio: 15.25%
Number of Hedge Fund Holders: 136
Will Nance of Goldman Sachs initiated coverage of Mastercard Incorporated (NYSE:MA) on May 17, assigning a Buy rating and a price objective of $460, implying a 38% uptrend. As per Insider Monkey’s Q1 2022 database, 136 hedge funds held stakes in Mastercard Incorporated (NYSE:MA), down from 144 in the previous quarter. These stakes hold a collective value of over $15.44 billion.
At the end of Q1 2022, BlueSpruce Investments held stakes worth over $940.80 million in Mastercard Incorporated (NYSE:MA), purchasing additional 332,317 shares during the quarter. As a result, the company represented an impressive 15.25% of the hedge fund’s portfolio and topped the list of 10 stocks to buy according to BlueSpruce Investments.
Polen Capital, an investment management firm, in the first quarter of 2022 investor letter, mentioned Mastercard Incorporated (NYSE:MA). Here is what the fund 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.”
You can also take a peek at 10 Stocks to Buy According to Kevin McCarthy’s Breakline Capital and 10 Stocks to Buy According to Matthew Hulsizer’s PEAK6 Capital Management
