1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Shareholders: 262
Topping the list is Microsoft Corporation (NASDAQ:MSFT), another major tech giant and AR/VR player. The company’s HoloLens mixed reality (AR/VR) headsets incorporate eye tracking, hand tracking, and spatial tracking, and are being utilized by the U.S. military for field tests. It’s unclear when a commercial version of the headsets will be available, but they are coming.
Microsoft has also added metaverse functionality to its Microsoft Teams work collaboration platform in the form of Mesh, which allows employees from far-flung regions of the world to interact with each other through digital avatars in a virtual reality space where they can engage and collaborate in a more immersive and enjoyable way.
Hedge fund ownership of Microsoft Corporation (NASDAQ:MSFT) is up by more than 200% since 2013 thanks to the stellar leadership of Satya Nadella, who took over the reins from Steve Ballmer in 2014 and built the company into a cash generating force through its intelligent cloud and productivity services. Ken Fisher’s Fisher Asset Management owns 28.7 million MSFT shares on June 30, valued at $7.37 billion at that time.
L1 Capital International didn’t hold anything back in its glowing assessment of Microsoft Corporation (NASDAQ:MSFT) as the “most advantageously positioned business globally for long term success”, as it shared in its Q2 2022 investor letter:
“Saving the best for last, Microsoft Corporation (NASDAQ:MSFT) is the most advantageously positioned business globally for long term success. Powered by sustained growth drivers including cloud computing, security, data analytics, collaboration, artificial intelligence, automation, business productivity, low-code programming and gaming, amongst others.
No company is ‘macro immune’ as Microsoft’s management has recently explicitly noted, but the business is defensive.
Despite its immense size, Microsoft has more than doubled revenue over the past 5 years and will approach US$200 billion in financial year 2022, while EPS will have compounded at over 20% over this period. To be clear we do not expect this rate of growth to continue, but we do expect Microsoft to deliver healthy growth in revenue, earnings and cashflow despite challenging economic conditions. Meanwhile Microsoft retains a AAA-rated balance sheet, one of only two companies globally to hold the highest credit rating. We expect dividends and buybacks to consistently increase as Microsoft has limited other sensible ways to deploy its excess cashflow, particularly in an environment where proposed acquisitions will be under intense regulatory scrutiny…” (Click here to read the full text)
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