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.”
4. Microsoft Corporation (NASDAQ:MSFT)
Viking Global’s Stake Value: $1.02 billion
Viking Global’s 13F Portfolio: 4.13%
Number of Hedge Fund Holders: 259
Microsoft Corporation (NASDAQ:MSFT) was given an ‘Overweight’ rating and a $354 price target by Morgan Stanley analyst Keith Weiss on July 12. He noted that although the tech giant is likely to perform better than some of its peers in the software industry, it is not immune to the broader global economy. The analyst lowered his FY’2023 estimates due to concerns over lower consumer spending.
Viking Global held a $1.02 billion stake in Microsoft Corporation (NASDAQ:MSFT) at the end of the first quarter, representing 4.13% of its total portfolio. Fisher Asset Management was the most prominent MSFT shareholder with a massive $8.59 billion stake.
Overall, 259 hedge funds were stakeholders in Microsoft Corporation (NASDAQ:MSFT) at the end of March, down from 262 hedge funds in the previous quarter. The combined value of Q1 hedge fund holdings stood at $65.63 billion.
Carillon Tower Advisers, an investment management firm, had this to say about Microsoft Corporation (NASDAQ:MSFT) in its Q1 2022 investor letter:
“Stock selection contributed the most while sector allocation was also positive. An underweight to communication services and an overweight to energy helped performance, while an underweight to consumer staples and an overweight to materials detracted. Stock selection was strong within healthcare and materials but was weak within information technology and industrials. Microsoft (NASDAQ:MSFT) reported positive results driven by personal computing strength, but analysts were especially positive on its growth outlook for its Azure cloud-computing services.”
3. General Electric Company (NYSE:GE)
Viking Global’s Stake Value: $1.17 billion
Viking Global’s 13F Portfolio: 4.73%
Number of Hedge Fund Holders: 51
General Electric Company (NYSE:GE) is a multi-national conglomerate with interests in renewable energy, aviation, healthcare and power. The company shares represented 4.73% of Viking Global’s total Q1 portfolio.
A detailed review of the 900+ hedge funds in the Q1 database of Insider Monkey showed that 51 hedge funds held positions in General Electric Company (NYSE:GE), down from 57 hedge funds in the previous quarter. Ahead of Viking Global, Eagle Capital Management stood as the firm’s largest shareholder in the first quarter, with a stake consisting of 13.29 million shares priced at $1.21 billion.
On July 12, Morgan Stanley analyst Joshua Pokrzywinski lowered the firm’s price target on General Electric Company (NYSE:GE) to $95 from $100 and reiterated an ‘Overweight’ rating on the company shares. The analyst advised investors to avoid GE shares in front of Q2 earnings as second half expectations need to come down. However, he still sees the stock carrying “an undemanding valuation” and a set of businesses that are considered generally more recession-resistant.
Vulcan Value Partners, an asset management firm, highlighted many stocks in its Q3 2021 investor letter, and General Electric Company (NYSE:GE) was one of them. Here’s what was said:
“During the quarter, we sold our positions in General Electric Co. General Electric is a company we followed for a long time. In the past, we removed GE from the MVP list due to management’s poor capital allocation decisions which resulted in value instability. Larry Culp, the former CEO of Danaher, became CEO of General Electric in 2018. The company implemented a vast restructuring program to simplify the industrial side of its business, sold off non-core assets, paid down debt with the proceeds, and drastically shrunk GE Capital. These restructuring activities allowed its world-class jet engine and healthcare businesses to shine through, and improved value stability. As a result, we added the company back to the MVP list. While the pandemic negatively impacted General Electric’s aviation business in the short run, it also gave us the opportunity to buy General Electric in the second quarter of 2020 with a substantial margin of safety. GE is a good example of a competitively entrenched, yet slower growing MVP business. As its stock price rose rapidly over the last year, its value growth did not keep up, and the price to value gap closed quickly. As our margin of safety diminished, we sold our position in GE and allocated to more discounted companies.”
2. Amazon.com, Inc. (NASDAQ:AMZN)
Viking Global’s Stake Value: $1.37 billion
Viking Global’s 13F Portfolio: 5.57%
Number of Hedge Fund Holders: 271
Amazon.com, Inc. (NASDAQ:AMZN) stock represented 5.57% of Andreas Halvorsen’s Q1 portfolio, with a $1.37 billion stake which saw an increase of 52% over the previous quarter.
AMZN was hedge funds’ favorite stock in the first quarter of 2022, with 271 reporting ownership of stakes in the company at the end of March. The combined value of these stakes stood at more than $48 billion. $7.7 billion worth of Amazon.com, Inc. (NASDAQ:AMZN) shares established Fisher Asset Management as the firm’s largest shareholder in the first quarter of 2022.
On July 11, JPMorgan analyst Doug Anmuth reiterated Amazon.com, Inc. (NASDAQ:AMZN) as his best idea in the internet sector, and gave the stock an unchanged ‘Overweight’ rating with a $175 price target. He expects the firm’s annual Prime Day sales to generate incremental revenue of $3.8 billion, up 7% from year-ago figure of $3.6 billion. The analyst believes the Prime Day event will help Amazon leverage some of its excess capacity.
Here is what Weitz Investment Management had to say about Amazon.com, Inc. (NASDAQ:AMZN) in its Q1 2022 investor letter:
“Amazon.com’s (NASDAQ:AMZN) stock was down modestly in the quarter, but opportunistic purchases helped the position contribute positively to the Fund. Our index short positions against ETFs tracking market indexes provided helpful ballast during the first quarter drawdown but were otherwise detractors for the fiscal year. During the quarter, we covered roughly 20% of our S&P 500 short and 50% of our Nasdaq 100 short at progressively lower prices. Among our long equities, we added materially to high-conviction holdings Amazon.com.”
1. T-Mobile US, Inc. (NYSE:TMUS)
Viking Global’s Stake Value: $1.72 billion
Viking Global’s 13F Portfolio: 6.96%
Number of Hedge Fund Holders: 91
T-Mobile US, Inc. (NYSE:TMUS) was the largest holding of Andreas Halvorsen, as reported by 13F filings for the first quarter of 2022. The billionaire owned 13.41 million shares of the company priced at $1.72 billion. This represented nearly 7% of the fund’s total portfolio, and was a 3% boost in stake over the previous quarter.
On July 1, Raymond James analyst Ric Prentiss kept a ‘Strong Buy’ rating on T-Mobile US, Inc. (NYSE:TMUS) shares, and raised the price target to $160 from $158. Tigress Financial analyst Ivan Feinseth was also bullish on TMUS stock, with a ‘Buy’ rating and a $195 price target, up from $185. He noted that the firm’s growth momentum continues to accelerate due to ongoing demand for high-speed network connectivity. The analyst also noted that the company could start its $60 billion share repurchase program later this year if subscriber growth remains strong.
At the end of Q1 2022, 91 hedge funds disclosed ownership of stakes in T-Mobile US, Inc. (NYSE:TMUS) with an aggregate value of $7.24 billion. This is a positive trend from the preceding quarter where 86 hedge funds held $6.06 billion worth of stakes in the company.
You can also take a look at 10 Best Value Stocks To Buy Now and 15 Biggest Tech Companies In The World.
