In this article, we discuss the 5 stocks that legendary value investor Joel Greenblatt loves. If you want to read about some more stocks in the Greenblatt portfolio, go directly to Legendary Value Investor Joel Greenblatt Loves These 10 Stocks.
5. Oracle Corporation (NYSE:ORCL)
Number of Hedge Fund Holders: 57
Oracle Corporation (NYSE:ORCL) provides information technology solutions to businesses. Latest filings show that Gotham Asset Management owned 204,102 shares in the firm at the end of December 2021 worth $17.8 million, representing 0.57% of the portfolio. The fund has increased its stake in the firm by 28% in the fourth quarter compared to third quarter filings.
Oracle Corporation (NYSE:ORCL) is another long-term holding of the fund, having featured in the portfolio since early 2011. The first position of the fund in the firm comprised just 10,000 shares bought at an average price of $32.20 per share. The shares have since climbed above $93 per share. The fund has reduced its stake in the company in three of the last four quarters.
At the end of the fourth quarter of 2021, 57 hedge funds in the database of Insider Monkey held stakes worth $4 billion in Oracle Corporation (NYSE:ORCL), up from 56 in the preceding quarter worth $3.4 billion.
Here is what ClearBridge Investments has to say about Oracle Corporation (NYSE:ORCL) in its Q3 2021 investor letter:
“While the information technology (IT) sector in the benchmark stalled amid rising rates, our holdings outperformed in relative terms, helped in part by a strong quarter from Oracle Corporation (NYSE:ORCL), the dominant provider of on-premise database software for large enterprises globally and an increasingly viable cloud competitor. Solid quarterly results, raised guidance, healthy underlying metrics and an attractive valuation contributed to strong performance during the period.”
4. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 83
Johnson & Johnson (NYSE:JNJ) makes and sells healthcare products. According to 13F filings, the hedge fund of Joel Greenblatt owned 102,556 shares in the firm at the end of the fourth quarter of 2021 worth $17.5 million, representing 0.56% of the portfolio. The fund slashed its position in the company by 9% in the fourth quarter compared to filings for the previous quarter.
Johnson & Johnson (NYSE:JNJ) has been a constant feature in the Greenblatt portfolio, with minor exceptions, since the fourth quarter of 2010. The fund first purchased a stake in the firm comprising nearly 4,000 shares at an average price of around $63 per share. The share price has since climbed above $163. The fund has added to the holding in two of the last four quarters, reducing it in the other two.
At the end of the fourth quarter of 2021, 83 hedge funds in the database of Insider Monkey held stakes worth $7.3 billion in Johnson & Johnson (NYSE:JNJ), compared to 88 in the previous quarter worth $6.8 billion.
3. The Coca-Cola Company (NYSE:KO)
Number of Hedge Fund Holders: 70
The Coca-Cola Company (NYSE:KO) is a beverage company based in Georgia. Securities filings show that Greenblatt’s investment firm owned 283,982 shares in the firm at the end of December 2021 worth $16.8 million, representing 0.54% of the portfolio. The fund increased its stake in the company by 31% in the fourth quarter compared to third quarter filings.
Gotham Asset Management first purchased a stake in The Coca-Cola Company (NYSE:KO) during the third quarter of 2012. The stake comprised 8,500 shares bought at an average price of $38 per share. The fund has since added to that holding handsomely. In the last three quarters, the fund has been loading up on the stock, increasing stake in the firm by 3%, 76%, and over 30% respectively.
Among the hedge funds being tracked by Insider Monkey, Nebraska-based firm Berkshire Hathaway is a leading shareholder in The Coca-Cola Company (NYSE:KO) with 400 million shares worth more than $23 billion.
2. Cisco Systems, Inc. (NASDAQ:CSCO)
Number of Hedge Fund Holders: 57
Cisco Systems, Inc. (NASDAQ:CSCO) makes and sells networking and other products. Regulatory filings reveal that Gotham Asset Management owned 262,569 shares in the company at the end of December 2021 worth $16.5 million, representing 0.53% of the portfolio. The fund has decreased its stake in the networking firm by 8% in the fourth quarter compared to the third quarter data.
Since late 2010, the fund has constantly held a stake in Cisco Systems, Inc. (NASDAQ:CSCO), barring a few minor exceptions. The initial stake was purchased at an average price of around $21.2 per share. The share price has now jumped above $57.13. The fund has increased its stake in the firm in two of the last four quarters.
At the end of the fourth quarter of 2021, 57 hedge funds in the database of Insider Monkey held stakes worth $3.4 billion in Cisco Systems, Inc. (NASDAQ:CSCO), compared to 63 in the previous quarter worth $3.9 billion.
Here is what ClearBridge Investments has to say about Cisco Systems, Inc. (NASDAQ:CSCO) in its Q3 2021 investor letter:
“We reinvested a portion of the proceeds into existing holding Cisco Systems, Inc. (NASDAQ:CSCO), which also has highly valuable technology and an improving secular growth story with its leading position in core networking hardware, as well as in its growing software and services business. Cisco Systems, Inc. (NASDAQ:CSCO) has refocused on winning share in the large and growing hyperscale market and has been investing aggressively in R&D to support growth. We believe Cisco has found new legs after previously ceding some growth opportunities in cloud while maintaining its strong presence in the carrier and enterprise markets. Cisco Systems, Inc. (NASDAQ:CSCO) boasts a strong balance sheet and accelerating multiyear growth while trading at a modest multiple of earnings.”
1. Medtronic plc (NYSE:MDT)
Number of Hedge Fund Holders: 55
Medtronic plc (NYSE:MDT) makes and sells device-based medical therapies. 13F data reveals that Greenblatt’s investment firm owned 159,983 shares in the firm at the end of December 2021 worth $16.5 million, representing 0.53% of the portfolio. The fund has increased its stake in the health firm by 83% between October and December compared to third quarter data.
Medtronic plc (NYSE:MDT) has featured in the Gotham portfolio since early 2017. Back then, the position consisted of around 224,000 shares purchased at an average price of $78.11 per share. The share price has now climbed above $115. In the last three quarters, the fund has increased its stake in the firm by 22%, 15%, and over 80%.
At the end of the fourth quarter of 2021, 55 hedge funds in the database of Insider Monkey held stakes worth $2.7 billion in Medtronic plc (NYSE:MDT), compared to 62 in the previous quarter worth $2.2 billion.
Here is what Polen Capital has to say about Medtronic plc (NYSE:MDT) in its Q4 2021 investor letter:
“The top absolute detractors during the quarter (includes) Medtronic plc (NYSE:MDT). Shares of Medtronic underperformed during the quarter on what we see as short-term setbacks in its Renal Denervation technology and HUGO robotic surgery platform. Both are pipeline prospects that could be sources of revenue growth if Medtronic plc (NYSE:MDT) can successfully commercialize them. However, they are not generating meaningful sales today. Looking ahead, we believe Medtronic’s management is handling this world-leading tech business well and that its growth prospects remain compelling.”
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