In this article, we talk about the 5 blue chip stocks to buy now according to billionaire Andreas Halvorsen. If you wish to read our detailed analysis of Halvorsen’s hedge fund performance and stock selection, go directly to 10 Blue Chip Stocks To Buy Now According To Billionaire Andreas Halvorsen.
5. Brookfield Asset Management Inc. (NYSE:BAM)
Viking Global’s Stake Value: $922.37 million
Viking Global’s 13F Portfolio: 3.72%
Number of Hedge Fund Holders: 35
Brookfield Asset Management Inc. (NYSE:BAM) is one of the world’s largest alternative investment management companies, and is headquartered in Canada. As of 2022, it boasts more than $725 billion in assets under management (AUM).
On May 20, RBC Capital analyst Geoffrey Kwan lowered the firm’s price target on Brookfield Asset Management Inc. (NYSE:BAM) to $68 from $72 and maintained an ‘Outperform’ rating on the company shares. The analyst noted that the company offers an attractive combination of positive fundamentals and potential catalysts. BAM has a $0.14 per share quarterly dividend, and a 1.24% yield as of July 12.
Out of all the hedge funds tracked by Insider Monkey, 35 held positions in Brookfield Asset Management Inc. (NYSE:BAM) with a combined value of $2.7 billion. This shows vastly improving investor confidence over the previous quarter where 29 hedge funds were bullish on the company shares. Andreas Halvorsen’s Viking Global held 16.3 million shares of Brookfield Asset Management Inc. (NYSE:BAM) priced at $922.4 million, making it the firm’s largest Q1 shareholder.
Saltlight Capital, an asset management firm, mentioned many stocks in its Q1 2022 investor letter, and Brookfield Asset Management Inc. (NYSE:BAM) was one of them. It said:
“During times like this, it is always helpful to remember what your portfolio is built with. One company that we’ve alluded to in the past is Brookfield Asset Management (NYSE:BAM). We’ve been invested in BAM across our various funds since 2019 and could not describe a more ‘resilient, indispensable and durable’ portfolio company. BAM is one of the largest alternative asset managers in the world, but it has some nuances that make it screen poorly (we’ll get into that). It started life as an industrial conglomerate called Brascan in Canada and so in line with general Canadian culture is understated and stays out of the limelight.
Bruce Flatt has been the CEO for over two decades and is the type of manager that we seek to partner with: honest, trustworthy, and extremely capable. We highly recommend watching these two videos: a Google talk in 2018 and this David Rubenstein interview to get a sense of Flatt. Importantly, BAM is not just about Flatt and his singular investing skills as many asset managers are. This is a widely scaled business. We’ve been impressed with the caliber of up-and-coming executives operating the individual businesses which give us confidence that the BAM culture will be retained for many decades to come.
BAM is unique in that it is an asset manager of third-party capital (called Limited Partners or LPs) but it also co-invests with its investors using its own capital. It certainly eats its own cooking (something that we can resonate with). Therefore, the intrinsic value should be comprised of invested capital plus the discounted value of future fee income. On top of this, if they generate outsized returns, they earn performance fees over an agreed-upon hurdle rate (called “carried interest”). BAM has an enviable track record, but a big part of their differentiation is that they run an internal operating business as well. Alongside investing staff, they have operators, engineers and domain experts that can optimize the operations of their investments. This allows them to buy cheap ‘fixer uppers’, send in their operators and re-sell them at a premium valuation. This is their secret sauce.”
