This article presents an overview of the 5 Undervalued S&P 500 Stocks Billionaires Are Loading Up On. For a detailed overview of such stocks, read our article, 15 Undervalued S&P 500 Stocks Billionaires Are Loading Up On.
5. Bristol-Myers Squibb Co (NYSE:BMY)
Number of Billionaire Investors: 18
Bristol-Myers Squibb Co (NYSE:BMY) recently made its common shareholders, and the 18 billionaires who are its shareholders, extremely happy, as it announced a 5.3% raise in its dividends. Bristol-Myers Squibb Co (NYSE:BMY) has also approved a share buyback plan of $3 billion of its common stock under Bristol-Myers Squibb Co’s (NYSE:BMY) multi-year share repurchase program.
Some notable billionaire shareholders of Bristol-Myers Squibb Co (NYSE:BMY) include Israel Englander, DE Shaw and Israel Englander.
Madison Sustainable Equity Fund made the following comment about Bristol-Myers Squibb Company (NYSE:BMY) in its Q3 2023 investor letter:
“During the quarter, we sold our positions in Bristol-Myers Squibb Company (NYSE:BMY) and The Walt Disney Company. We added Texas Instruments as a new position. Bristol-Myers has been dealing with the loss of exclusivity for Revlimid, one of its key products. Although the company is launching new drugs in melanoma, heart failure, and psoriasis it will need additional products to offset the lower revenue in Revlimid.”
4. Chevron Corporation (NYSE:CVX)
Number of Billionaire Investors: 19
Oil giant Chevron Corporation (NYSE:CVX) is famous among billionaires amid share price gains and dividends. Chevron Corporation (NYSE:CVX) has over 35 years of consistent dividend increases under its belt.
As of the end of the September quarter, 20 billionaires in Insider Monkey’s database had stakes in Chevron Corporation (NYSE:CVX).
Ariel Focus Fund made the following comment about Chevron Corporation (NYSE:CVX) in its third 2023 investor letter:
“Also in the quarter, we initiated a position in Chevron Corporation (NYSE:CVX), the second largest integrated energy company in the U.S., operating in exploration, production and refining on a global scale. We view the company as competitively advantaged with a strong balance sheet, sustainable growth pathway and an effective management team. Going forward CVX expects improved cost efficiencies and production growth via its differentiated position in the Permian Basin and recent acquisition of Noble Energy. Additionally, management believes a combination of its new higher-margin projects along with operational improvements will drive a double-digit return of capital employed by 2027. Although oil and gas prices, which lay outside of the company’s control, ultimately dictate Chevron’s earnings and cashflow profile, the organization is laser focused on capital discipline. It is this lack of predictability, and potential fear of a global recession which presented us with an opportunity to initiate a position in this high barrier to entry producer at reasonable prices.”
3. Cisco Systems Inc (NASDAQ:CSCO)
Number of Billionaire Investors: 19
Cisco Systems Inc (NASDAQ:CSCO) ranks 3rd in our list of the undervalued S&P 500 stocks owned by billionaire hedge fund managers. A total of 19 billionaires had stakes in Cisco Systems Inc (NASDAQ:CSCO) as of the end of the September quarter. In November the stock fell after Cisco Systems Inc (NASDAQ:CSCO) gave a weak full-year revenue guidance.
Oakmark Fund made the following comment about Cisco Systems, Inc. (NASDAQ:CSCO) in its Q3 2023 investor letter:
“Cisco Systems, Inc. (NASDAQ:CSCO) is the leading networking solutions company. Networking equipment becomes more important as businesses modernize their IT infrastructure, and Cisco is well positioned to capture this demand given its broad portfolio and highly effective go-to-market strategy. Cisco is transitioning away from selling mainly transactional hardware and toward selling more software and subscriptions. This shift is expected to accelerate revenue growth, improve operating margins and build recurring revenue. Despite these notable business improvements, Cisco still trades near a trough valuation relative to the S&P 500 Index. More recently, Cisco announced its intention to acquire Splunk, a leader in security and observability, adding to its already strong position in the increasingly important security market. At a low-teens multiple of our estimate of normalized earnings, Cisco is trading comfortably below our estimate of intrinsic value.”
2. Lennar Corp (NYSE:LEN)
Number of Billionaire Investors: 20
Home construction company Lennar Corp (NYSE:LEN) is a popular choice of billionaire hedge fund managers tracked by Insider Monkey. Out of the 20 billionaires having stakes in Lennar Corp (NYSE:LEN), some notable individuals are Cliff Asness, D. E. Shaw, Mario Gabelli and Ray Dalio.
1. General Electric Co (NYSE:GE)
Number of Billionaire Investors: 21
General Electric Co (NYSE:GE) tops our list of the undervalued stocks in the S&P 500 index loved by billionaires. A total of 21 billionaires had stakes in General Electric Co (NYSE:GE) as of the end of the third quarter, according to Insider Monkey’s database.
Longleaf Partners Fund made the following comment about General Electric Company (NYSE:GE) in its Q3 2023 investor letter:
“After a busy first half of the year, we initiated one new position in the quarter in a business we have successfully owned previously and were able to buy again at a discount within a new corporate structure. We opportunistically trimmed and added to several positions throughout the quarter, and we exited General Electric Company (NYSE:GE) and our small position in Hasbro after the share price ran away from us. GE was a multi-year portfolio holding for us that started out rocky but ultimately was a good illustration of owning a “quality” business that was temporarily viewed as “value” (aka, perceived as low quality) before ultimately being weighed properly by the market. CEO Larry Culp was a great partner, creating significant value for shareholders and closing the price-to-value gap. Under his leadership, GE materially improved its operations and is well under way on plans to simplify the business by separating it into three world-class companies. The market has finally caught up with reality versus perception and is pricing GE accordingly. Unfortunately, this means we no longer see a margin of safety for the business but will continue to watch GE and Culp closely and hope to have the opportunity to partner with him again.”
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