Apple Inc. (AAPL), Exxon Mobil (XOM) Among Adage Capital’s Biggest Bets

General Electric Company (NYSE:GE), meanwhile, is Adage’s next largest 13F holding. Wall Street analysts expect sales to only be up 4% in 2013, but longer-term growth is expected to be driven by increased spending in aerospace and energy infrastructure.  Another positive factor for the stock should be improving credit and lending markets. This will help lift its GE Capital segment (30% of FY2011 revenues), which partakes in consumer lending.

Compared to other diversified tech and products companies, GE trades relatively in line on a P/E basis at 16x, compared to 3M (15x) and United Technologies (15x). One bright spot for GE is its solid 3.5% dividend yield, which is well covered by some $85 billion in cash – annual dividend payout is around $8 billion. Billionaire George Soros is one of GE’s biggest fans, upping his stake by 20% last quarter (check out George Soros’ newest picks).

Honeywell International Inc. (NYSE:HON) came in as Adage’s next largest 13F holding, making up 1.3% of the firm’s 13F portfolio. Honeywell is another diversified tech and products company that trades a bit above the others at 23x earnings. This diversified products company also pays a less robust dividend than GE, yielding only 2.5%, but it also expects low sales growth in 2013 at 2%.

Honeywell has large exposure to aerospace (33% of 3Q 2012 revenues) that should benefit from a rebounding economy. Generally bullish trends in air travel should lead to higher fleet sizes and greater demand for fuel-efficient aircraft. Ken Griffin – founder of Citadel Investment Group – is one of Honeywell’s top investors (check out Ken Griffin’s new picks).

To recap: Adage has its top investments concentrated in the large-cap sector, but across a variety of industries that include tech, energy, tobacco and diversified products. Apple, being a top tech company, should continue growing with product innovation, while higher demand for oil and gas will help not only Exxon, but also GE. Philip Morris is one of the cheapest tobacco stocks out there, and is a top player in its industry. Honeywell should be able to ride the broader economy higher with its exposure to safety solutions and aerospace.

Read more related coverage here:

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Disclosure: I have no positions in any of the stocks mentioned above