In this article, we discuss the 10 new stock picks of billionaire Ray Dalio. If you want to skip our detailed analysis of these stocks, go directly to the 5 New Stock Picks of Billionaire Ray Dalio.
Ray Dalio is one of the famous money managers on Wall Street with a diverse portfolio that includes clients such as central banks, university endowments, as well as public and corporate pension funds. His fund, Bridgewater Associates, has been one of the most successful investment firms of the past three decades, beating the average annual return of the benchmark S&P 500 by more than four percentage points. Dalio has a personal net worth of over $20 billion and is placed amongst the top 30 richest Americans.
According to the latest 13F filings, the portfolio value of Bridgewater Associates at the end of the third quarter of 2021 was in the excess of $18 billion, up from $15 billion at the end of the second quarter, with the top ten holdings comprising 38% of the total. With investments concentrated in the consumer goods and services sectors, some of the top stocks in the portfolio included Walmart Inc. (NYSE:WMT), The Coca-Cola Company (NYSE:KO), and The Procter & Gamble Company (NYSE:PG), among others.
In a post on professional networking platform LinkedIn in November, posted after the US Consumer Price Index touched a record high in October, Dalio outlined some of his fears regarding inflation. The billionaire said that the United States was spending a lot more money than it was earning and paying for it by printing money that was being devalued. He said this meant that the country was going down a path of “misery and turbulence ahead”. Dalio thinks that the people who put their money in cash in this scenario will likely get hurt.
Investors who want a sneak peek into the actual moves that Dalio made at the market in light of the new developments should consider the latest changes to his portfolio. Regulatory filings show that between June and September, Bridgewater Associates made new purchases in 117 stocks, additional purchases in 343, sold out of 138, and reduced holdings in 216 equities.
The new additions to the portfolio are discussed in detail below.
Our Methodology
These stocks were picked from the investment portfolio of Bridgewater Associates at the end of the third quarter of 2021. All the stocks listed below were added to the portfolio of the fund between June and September this year.
The hedge fund sentiment around each stock was calculated using the data of 873 hedge funds tracked by Insider Monkey.
Ray Dalio of Bridgewater Associates
New Stock Picks of Billionaire Ray Dalio
10. Levi Strauss & Co. (NYSE:LEVI)
Number of Hedge Fund Holders: 30
Levi Strauss & Co. (NYSE:LEVI) markets apparel, accessories and luxury goods. The stock has rallied in the past few weeks after the firm beat market estimates on earnings for the third quarter and analysts laid out their bullish views for apparel firms ahead of the holiday season.
Latest data shows that Bridgewater Associates owned 135,430 shares of Levi Strauss & Co. (NYSE:LEVI) at the end of the third quarter of 2021 worth $3.3 million in value.
At the end of the second quarter of 2021, 30 hedge funds in the database of Insider Monkey held stakes worth $414 million in Levi Strauss & Co. (NYSE:LEVI), up from 19 the preceding quarter worth $253 million.
Just like Walmart Inc. (NYSE:WMT), The Coca-Cola Company (NYSE:KO), and The Procter & Gamble Company (NYSE:PG), Levi Strauss & Co. (NYSE:LEVI) is one of the stocks that hedge funds are buying.
9. Lithia Motors, Inc. (NYSE:LAD)
Number of Hedge Fund Holders: 63
Lithia Motors, Inc. (NYSE:LAD) provides automotive retail services. According to regulatory filings, Bridgewater Associates owned 7,537 shares in the company at the end of September 2021 worth $2.3 million.
Craig-Hallum analyst Ryan Sigdahl has a Buy rating on Lithia Motors, Inc. (NYSE:LAD) stock with a price target of $520. In an investor note, the analyst has appreciated the record-breaking earnings results of the firm so far this year.
At the end of the second quarter of 2021, 63 hedge funds in the database of Insider Monkey held stakes worth $2.9 billion in Lithia Motors, Inc. (NYSE:LAD), up from 40 in the preceding quarter worth $2.3 billion.
8. Lockheed Martin Corporation (NYSE:LMT)
Number of Hedge Fund Holders: 58
Lockheed Martin Corporation (NYSE:LMT) operates as a security and aerospace company. The firm recently announced that it had been awarded a $10.8 billion contract by the US Air Force for Advanced Raptor Enhancement & Sustainment for the F-22 program.
The hedge fund of billionaire Ray Dalio owned over 1 million shares of Lockheed Martin Corporation (NYSE:LMT) at the end of the third quarter of 2021 worth more than $7.5 million, representing a very small portion of the total portfolio of the fund.
Among the hedge funds being tracked by Insider Monkey, New York-based firm Arrowstreet Capital is a leading shareholder in Lockheed Martin Corporation (NYSE:LMT) with 536,001 shares worth more than $202 million.
In its Q4 2020 investor letter, RiverPark Advisors, LLC, an asset management firm, highlighted a few stocks and Lockheed Martin Corporation (NYSE:LMT) was one of them. Here is what the fund said:
“Despite better-than-expected third quarter results, LMT shares were weak for the quarter as defense spending is expected to be flat for the coming year. With a record $150 billion backlog and almost 30% of its revenue coming from building F-35 aircraft with deliveries forecast to reach 180 per year in 4-5 years (3Q’s revenue upside was from the F-35), we believe LMT should grow at a higher rate than overall defense budget growth and Street expectations over the next several years. Further, strategic acquisitions (LMT acquired AJRD for $4 billion in late December), debt pay down, a 3% dividend yield, and continued share buybacks from $6 billion per year of free cash flow should lead to even greater shareholder returns.”
7. Philip Morris International Inc. (NYSE:PM)
Number of Hedge Fund Holders: 46
Philip Morris International Inc. (NYSE:PM) makes and sells tobacco products. At the end of the third quarter of 2021, Bridgewater Associates owned 72,137 shares in the company worth $6.8 million, representing 0.03% of the portfolio.
Amid reports that Philip Morris International Inc. (NYSE:PM) is planning to merge with Altria, another tobacco giant, the CEO of the former, Jacek Olczak, has recently come out and dismissed the suggestion, instead revealing that the company was planning to move into the cannabidiol market.
Among the hedge funds being tracked by Insider Monkey, London-based investment firm Fundsmith LLP is a leading shareholder in Philip Morris International Inc. (NYSE:PM) with 19.3 million shares worth more than $1.8 billion.
In its Q4 2020 investor letter, Fundsmith LLP highlighted a few stocks and Philip Morris International Inc. (NYSE:PM) was one of them. Here is what the fund said:
“We are impressed with Philip Morris’s development of Reduced Risk Products or RRPs, most notably its heat not burn system iQOS. It seems we are not the only ones to view it this way as it was recently included in the Dow Jones Sustainability North America Index for the first time. For the moment the shares are weighed down by COVID related disruption to some of its markets and simple prejudice which seems to prevent some commentators from weighing the benefits the RRPs bring against the obvious fact that it is a tobacco company.”
6. XPO Logistics, Inc. (NYSE:XPO)
Number of Hedge Fund Holders: 57
XPO Logistics, Inc. (NYSE:XPO) is a supply chain solutions provider. The company recently posted earnings for the third quarter, reporting earnings per share of $0.94, beating estimates by $0.01. The revenue over the period was $3.2 billion, up 22% year-on-year.
Latest securities filings reveal that Bridgewater Associates owned 31,883 shares in XPO Logistics, Inc. (NYSE:XPO) at the end of the third quarter of 2021 worth $2.5 million.
Among the hedge funds being tracked by Insider Monkey, Bermuda-based investment firm Orbis Investment Management is a leading shareholder in XPO Logistics, Inc. (NYSE:XPO) with 11 million shares worth more than $1.5 billion.
In addition to Walmart Inc. (NYSE:WMT), The Coca-Cola Company (NYSE:KO), and The Procter & Gamble Company (NYSE:PG), XPO Logistics, Inc. (NYSE:XPO) is one of the stocks on the radar of institutional investors.
In its Q4 2020 investor letter, Adestella Investment Management, an asset management firm, highlighted a few stocks and XPO Logistics, Inc. (NYSE:XPO) was one of them. Here is what the fund said:
“XPO Logistics (XPO) – the XPO thesis was very simple, but it proved very successful. As the stock irrationally sold off in the spring and made only a tepid recovery in the following months, we were able to buy into a well-operated business with plenty of growth drivers at a compelling price. Sentiment surrounding the company improved thanks to a strong earnings, the resumption of asset sale plans that had been shelved in the spring, and the announcement of a spinoff to unlock the SOTP value. As the stock approached our estimate of a $115 fair value, we exited with more than a clean double from our cost basis.”
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Disclosure. None. 10 New Stock Picks of Billionaire Ray Dalio is originally published on Insider Monkey.
