In this article, we will take a look at the 5 best stocks to buy and hold for the next 15 years according to Cathie Wood’s portfolio. To see more such companies, go directly to 16 Best Stocks to Buy and Hold for the Next 15 Years According to Cathie Wood’s Portfolio.
5. Teradyne, Inc. (NASDAQ:TER)
Number of Hedge Fund Holders: 41
Testing solutions company Teradyne, Inc. (NASDAQ:TER) is one of the top stocks to buy and hold for the next 15 years according to Cathie Wood. ARK Invest first bought stakes in Teradyne, Inc. (NASDAQ:TER) during the fourth quarter of 2016. As of the end of the second quarter of 2023, the fund had a $131 million stake in Teradyne, Inc. (NASDAQ:TER).
Insider Monkey’s database of 910 hedge funds shows that 41 hedge funds had stakes in Teradyne, Inc. (NASDAQ:TER) as of the June quarter, up from 33 hedge funds in the previous quarter. This shows a massive jump in hedge fund sentiment for Teradyne, Inc. (NASDAQ:TER).
4. Twilio Inc. (NYSE:TWLO)
Number of Hedge Fund Holders: 49
Communications platform and technology company Twilio Inc. (NYSE:TWLO) came on ARK’s radar back in 2018 when the fund bought a stake in the company during the last quarter of the year. As of the second quarter of this year, the fund owns a $448 million stake in Twilio Inc. (NYSE:TWLO).
Aristotle Atlantic Focus Growth Strategy made the following comment about Twilio Inc. (NYSE:TWLO) in its Q4 2022 investor letter:
“We sold Twilio Inc. (NYSE:TWLO) and thereby reduced our subsector weight in software. The company reported a decent third quarter, but disappointed on fourth quarter 2022, full year 2023, and long-term guidance. The company is seeing macroeconomic headwinds and a slowdown spreading from technology, social media and cryptocurrency to retail and e-commerce. The other negative disclosure and a driver of this gross margin “miss” was that Twilio’s software sales are not accelerating at the rate that we expected. We are disappointed with this lower topline and low operating margin improvement guidance. The business transformation is taking longer than expected, and there is the heightened possibility that the new software growth could be stifled by more formidable competition as Twilio has made too many missteps.”
3. Shopify Inc. (NYSE:SHOP)
Number of Hedge Fund Holders: 74
Shopify Inc. (NYSE:SHOP) is one of the most favorite stocks of Cathie Wood. Cathie Wood’s hedge fund bought a stake in Shopify Inc. (NYSE:SHOP) back in the second quarter of 2017. The fund had a $573 million stake in Shopify Inc. (NYSE:SHOP) as of the end of the second quarter of 2023. Shopify Inc. (NYSE:SHOP) shares have gained about 50% year to date. Analysts are praising Shopify Inc. (NYSE:SHOP)’s deal with Amazon that would allow Shopify merchants to offer a Buy with Prime option for payment processing and fulfillment.
ARK Invest’s Andrew Kim also commented on the deal:
“Now, having sold Shopify Logistics to Flexport, Shopify no longer competes with Amazon in fulfillment, which has paved the way for compromise. Although Shopify now owns 6% of Flexport, the lower priced logistics service, the introduction of Amazon’s fulfillment services does erode its moat as Shopify’s official logistics provider.”
RiverPark Large Growth Fund made the following comment about Shopify Inc. (NYSE:SHOP) in its Q2 2023 investor letter:
“Shopify Inc. (NYSE:SHOP): Shopify shares were a top contributor in the quarter following strong 1Q results and the announced divestiture of its logistics business. Gross Merchandise Volume (GMV) grew 15% year over year as e-commerce sales broadly rebounded and Shopify continued to take market share. Revenue grew 25% driven by increased merchant adoption of multiple products, especially Shop Pay. The company generated $86 million of free cash flow, up from a $46 million loss last year, and announced expectations to be free cash flow positive for each quarter for the rest of the year. The company had previously announced several cost savings plans, which are driving margin and free cash flow improvement, and now plans to divest its capital-intensive logistics arm. Faster growing revenue, lower operating expenses, and a less capital-intensive future were all cheered on by the market.
Last year, 10% of US retail e-commerce sales flowed through SHOP, second only to Amazon, and the company is still enjoying significant tailwinds as retail merchants of all sizes adopt SHOP’s software tools to display, manage and sell their products across a dozen different sales channels. We believe that the overall growth of e-commerce, combined with the development of new products and services, such as its digital wallet Shop Pay, should continue to drive revenue growth of more than 20% per year over the next several years, accompanied by re-acceleration of operating margin growth and FCF generation.”
2. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 79
Tesla, Inc. (NASDAQ:TSLA) is among the top stocks to buy and hold for the next 15 years according to Cathie Wood’s portfolio. Cathie Wood first bought a stake in Tesla, Inc. (NASDAQ:TSLA) back in 2016. ARK now owns a $1.27 billion stake in Tesla, Inc. (NASDAQ:TSLA). Cathie Wood believes Tesla, Inc. (NASDAQ:TSLA) stock would hit $2000 by 2027.
Baron Partners Fund made the following comment about Tesla, Inc. (NASDAQ:TSLA) in its Q2 2023 investor letter:
Many factors contributed to the strong performance of our largest Disruptive Growth position, Tesla, Inc. (NASDAQ:TSLA), in the period. Investors’ concerns regarding Tesla in 2022 continue to dissipate, and the company’s business has continued to grow materially, although at below peak margins. Tesla’s deliveries in China are recovering. The company’s newest factory in Texas has ramped production and should contribute to improved domestic sales and margins. U.S. government policies have lowered the cost to own Tesla vehicles, while also reducing the company’s battery production expenses.
We continue to believe that Tesla is only scratching the surface of its potential. We regard announced partnerships between Tesla and its competitors in the quarter as important. In early June, Tesla agreed to provide Ford Motors access to Tesla’s electric vehicle (EV) charging technology and network. Other traditional and pure EV manufacturers, including General Motors, Rivian, and Volvo, quickly followed suit. We expect additional charging partnerships to ensue. In our view, these relationships validate Tesla’s charging technology and infrastructure as superior to other standards. Consolidation around a single technology should accelerate charging infrastructure deployment, diminish the risk of Tesla’s technology becoming obsolete, and lessen a key concern of hesitant EV purchasers. EV adoption is at a tipping point. And Tesla, with its approximately 60% domestic market share of EVs, should be the most important beneficiary of this shift…” (Click here to read the full text)
1. Intuit Inc. (NASDAQ:INTU)
Number of Hedge Fund Holders: 86
Cathie Wood first bought a stake in Intuit Inc. (NASDAQ:INTU) in the second quarter of 2017. Over the years she’s trimmed and upped her stake in Intuit Inc. (NASDAQ:INTU). As of the end of the second quarter of 2023, ARK Invest had a $33 million stake in Intuit Inc. (NASDAQ:INTU).
In August Intuit Inc. (NASDAQ:INTU) posted fiscal Q4 results. Adjusted EPS in the period came in at $1.65 beating estimates by $0.21. Revenue in the quarter came in at $2.7 billion, beating estimates by $60 million.
Artisan Global Opportunities Fund made the following comment about Intuit Inc. (NASDAQ:INTU) in its Q2 2023 investor letter:
“Intuit Inc. (NASDAQ:INTU) has dominant market share positions in its two largest brands. QuickBooks has 75%–80% share in small business accounting, and TurboTax has 60%–65% share in tax prep software and 30% share of overall tax filings. And Intuit is driving growth within each platform. The recently launched QuickBooks Advanced is serving as a new customer acquisition funnel in the middle market and a retention tool for the 10%–15% of customers who “graduate” off the QuickBooks platform each year. Also, the company is experiencing accelerating growth within its underpenetrated payroll and payments offerings, which will drive higher average revenues per customer and higher margins. With TurboTax, the company is focusing on moving more people to live-assisted and full-service offerings. The do-it-yourself tax market is gaining 1%–2% of market share per year against CPA/accountants who control about 40% market share. And the overall market should continue to grow 1%–2% per year just based on growth in total IRS returns. While the company has sizable exposure to the small- and medium-sized business market, we believe it would be insulated from an economic slowdown given the mission-critical nature of these two offerings. We are also encouraged by the company’s plans to improve the platform by utilizing AI, which would drive an enhanced customer experience.”
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