In this article, we will discuss the top 5 stocks to buy in 2021 according to Guy Spier’s Aquamarine Capital. If you want to read our detailed analysis of Spier’s history, investment philosophy, and hedge fund performance, go directly to the 10 Stocks to Buy in 2021 According to Guy Spier’s Aquamarine Capital.
5. Micron Technology, Inc. (NASDAQ:MU)
Spier’s Stake Value: $16,996,000
Percentage of Guy Spier’s 13F Portfolio: 7.97%
Number of Hedge Fund Holders: 87
Micron Technology, Inc. (NASDAQ:MU) is a computer memory and data storage company in the United States. Its products include dynamic random-access memory, flash memory, and USB flash drives. It ranks fifth on our list of 10 stocks to buy in 2021 according to Guy Spier’s Aquamarine Capital.
On September 29, Wedbush analyst Matt Bryson lowered his price target on Micron Technology, Inc. (NASDAQ:MU) to $85 from $105 and maintained a “Neutral” rating on the shares post fourth-quarter results.
Arrowstreet Capital is the most significant shareholder of Micron Technology, Inc. (NASDAQ:MU) with 14.86 million, worth $1.26 billion. The hedge fund chaired by Guy Spier holds 200,000 shares in Micron Technology, Inc. (NASDAQ:MU) worth $17 million.
In its first-quarter 2021 investor letter, Bonsai Partners mentioned Micron Technology, Inc. (NASDAQ:MU). Here is what the fund said:
“Micron is a manufacturer of memory semiconductor chips. Micron appreciated 17.3% during the quarter.
With the semiconductor cycle in full swing, sentiment continued to improve for major DRAM and NAND suppliers. Spot pricing for DRAM continues its upward march due to supply shocks across the industry and sustained demand levels that continue to outstrip supply.
As a result, Micron showed improving results for the fiscal first quarter, raised guidance intra-quarter for the fiscal second quarter, and offered strong guidance for the fiscal third quarter in both growth and margins.
While the cyclical nature of DRAM hasn’t changed, the cycles themselves continue to become more benign, leading to long-term economic improvement across these businesses. Micron is now continuously profitable, with industry players in a dramatically stronger position than even just five years ago.
The biggest negative surprise in the quarter came from Micron’s exit from its 3D XPoint hybrid memory business. The company also announced its decision to sell its accompanying Utah fab. Fortunately, this development does not alter the investment thesis much since 3D XPoint was an option ticket for future growth. While it’s unfortunate this product didn’t pan out, now is an excellent time to sell a fab, so perhaps it is a blessing in disguise?”
4. Mastercard Incorporated (NYSE:MA)
Spier’s Stake Value: $24,005,000
Percentage of Guy Spier’s 13F Portfolio: 11.26%
Number of Hedge Fund Holders: 156
In September, Mastercard Incorporated (NYSE:MA) announced a quarterly dividend of $0.44 per share, in line with the previous. In August, JPMorgan analyst Tien-Tsin Huang raised his price target on Mastercard Incorporated (NYSE:MA) to $430 from $427 and reiterated an “Overweight” rating on the shares.
Aquamarine Capital holds 65,750 shares in Mastercard Incorporated (NYSE:MA) worth $24.01 million, representing 11.26% of its portfolio. At the end of the second quarter of 2021, 156 hedge funds in the database of Insider Monkey held stakes worth $17.10 billion in Mastercard Incorporated (NYSE:MA), up from 151 the preceding quarter worth $1.71 billion.
Qualivian Investment Partners, in its second-quarter 2021 investor letter, mentioned Mastercard Incorporated (NYSE:MA). Here is what the fund has to say in its letter:
“Mastercard: Q2 revenue and EPS beat consensus estimates by 3.7% and 12% respectively. Operating margins also beat consensus by +240 bps. Gross domestic volume growth of +38.3% (+32.8% in constant currency) was buttressed by continued e-commerce strength and better in-store performance, while purchase volumes grew 41.8% (35.5% in constant currency). Cross border performance was strong, but durability remains uncertain given uncertainty arising from the Delta variant and its impact on travel and tourism. We believe Mastercard has a robust runway for growth given further travel recovery, new/existing partnerships, traction in digital payments, and ongoing economic recovery.”
3. Bank of America Corporation (NYSE: BAC)
Spier’s Stake Value: $31,658,000
Percentage of Guy Spier’s 13F Portfolio: 14.85%
Number of Hedge Fund Holders: 87
On October 11, Jefferies analyst Ken Usdin raised his price target on Bank of America Corporation (NYSE:BAC) to $48 from $41 and reiterated a “Hold” rating on the shares.
In the second quarter of 2021, Aquamarine Capital owned 767,845 shares in Bank of America Corporation (NYSE:BAC) worth $31.66 million. This represented 14.85% of the investment portfolio of Aquamarine Capital. Legendary investor and billionaire Warren Buffett’s Berkshire Hathaway is the most significant stakeholder in Bank of America Corporation (NYSE:BAC) out of the 873 hedge funds tracked by Insider Monkey at the end of the second quarter. The Oracle of Omaha owns 1.01 billion shares of the company worth $41.65 billion.
In its first-quarter 2021 investor letter, ClearBridge Investments, an investment management firm, mentioned Bank of America Corporation (NYSE:BAC). Here is what the fund said:
“Higher long-term interest rates supported financials such as Bank of America, which has shown both defensive and offensive characteristics in the past year. We believe it continues to be the least risky large bank from a credit standpoint, with conservative underwriting and controlled risk taking, a leading consumer deposit franchise, scale and technology. It is also a leader in its commitments to sustainability, or as it terms it, responsible growth. Disclosure and reporting at all levels form a large part of this commitment, including gender diversity and equality, environmental commitments and support of communities in which it operates. In the first quarter Bank of America announced it is setting a goal of net-zero greenhouse gas (GHG) emissions in its supply chain and operations, and notably also in its financing activities, before 2050.”
2. American Express Company (NYSE:AXP)
Spier’s Stake Value: $34,698,000
Percentage of Guy Spier’s 13F Portfolio: 16.27%
Number of Hedge Fund Holders: 52
On October 16, BofA analyst Mihir Bhatia upgraded American Express Company (NYSE:AXP) to “Neutral” from “Underperform” and gave a price target of $169. In September, American Express Company (NYSE:AXP) declared a quarterly dividend of $0.43 per share, in line with the previous.
American Express Company (NYSE:AXP) stock accounts for about 16.27% of Aquamarine Capital’s portfolio, as the hedge fund owns a $34.70 million stake in the company.
In its second-quarter 2021 investor letter, ClearBridge Investments, an investment management firm, mentioned American Express Company (NYSE:AXP). Here is what the fund said:
“In financials, American Express has done an excellent job demonstrating the resiliency of its franchise in the midst of a global pandemic that drove a 60% decline in its core travel and entertainment business. The company’s spend-centric model has been helped by fiscal stimulus ensuring a flush consumer, while management continues to execute well by adding millions of new consumer and small and medium business accounts, which should benefit the franchise over the medium to long term. We remain optimistic regarding the company’s prospects as travel and entertainment activity rebounds, adding to our position in the quarter.”
1. Berkshire Hathaway Inc. (NYSE:BRK.A)
Spier’s Stake Value: $39,076,000
Percentage of Guy Spier’s 13F Portfolio: 18.33%
Number of Hedge Fund Holders: 116
Berkshire Hathaway Inc. (NYSE:BRK-A) operates in the insurance, freight rail transportation, and utility industries worldwide through its subsidiaries. It is ranked first on our list of 10 stocks to buy in 2021 according to Guy Spier’s Aquamarine Capital.
The hedge fund managed by Guy Spier owns more than 140,600 shares in Berkshire Hathaway Inc. (NYSE:BRK.A) worth over $39.08 million, representing close to 18.33% of their portfolio. Our database shows that 116 hedge funds are bullish on Berkshire Hathaway Inc. (NYSE:BRK.A) in the second quarter of 2021, up from 111 in the previous quarter. The hedge fund also owns 30 class A shares of Berkshire Hathaway.
In its third-quarter 2021 investor letter, Black Bear Value Partners mentioned Berkshire Hathaway Inc. (NYSE:BRK.A). Here is what the fund said:
“Please see Q1 letter for our Berkshire on a Napkin investment exercise. We have written on it extensively and will save your eyeballs from extraneous reading. Berkshire is very cheap for owning such high-quality businesses and will continue to grind higher and compound value for us.”
You can also take a peek at 8 Best Stocks to Buy According to Billionaire Nicholas J. Pritzker and 10 Best Stocks to Buy According to Billionaire Daniel Sundheim.
