Ray Dalio’s Bridgewater Associates revealed its top picks for the fourth quarter in a 13F Form filed with the U.S. Securities and Exchange Commission. Excluding its exchange-traded fund (ETF) holdings, the hedge fund’s largest position at the end of 2014 was in Gilead Sciences, Inc. (NASDAQ:GILD), with a stake of 537,300 shares. The investment firm’s other top bets for this quarter included Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), and Intel Corporation (NASDAQ:INTC).
Bridgewater Associates was founded by Ray Dalio in 1973, who was ranked as the world’s biggest and best-performing hedge fund manager in 2010 and 2011. A couple of years ago, Mr. Dalio stepped down from his position as CEO of the Westport, Connecticut-based firm, taking on the role of “mentor” and serving as co-CIO, alongside Robert Prince and Greg Jensen. Bridgewater Associates operates in the public equity and fixed income markets, employing fundamental analysis to pick its stocks. The fund has amassed an equity portfolio with a market value of $12.5 billion as of the end of 2014, down from $12.8 billion at the end of the third quarter.
Excluding its stake in ETFs, Bridgewater Associates disclosed Gilead Sciences, Inc. (NASDAQ:GILD) as its largest position, after increasing its stake in the company by 295,800 shares last quarter. The fund’s top pick for the end of 2014 has been performing well, gaining more than 26% last year, and seeing share prices grow by around 8% year-to-date. Furthermore, according to its latest earnings report, the pharmaceutical company achieved earnings of $2.43 per share, representing a 137% year-over-year increase in revenue, and beating the analyst consensus estimate of $2.23. In addition to solid earnings, last year the firm managed to triple its cash on the books to $11.7 billion, expand its margins by more than 20%, and boost sales by 122%. Hence, it comes as no surprise that Bridgewater Associates is not the only fund betting on Gilead Sciences, Inc. (NASDAQ:GILD). Amongst the funds we track, William B. Gray’s Orbis Investment Management stands out as one of Gilead’s largest shareholders among institutional investors, holding a stake of 2.57 million shares at the end of 2014.
Although Bridgewater Associates reduced its exposure to Apple Inc. (NASDAQ:AAPL) by more than 50% last quarter, it continues to own 259,400 common shares. This stock has not only delivered great returns in the past, but is also favored by a wide range of hedge funds, which remain bullish regarding its future performance. Last year, the stock gained almost 38%, and is currently trading around its 52-week high, with no end in sight to this upwards trajectory. In addition to Bridgewater Associates, David Einhorn’s Greenlight Capital also held Apple Inc. (NASDAQ:AAPL) amongst its top picks for 2014, with a position of 8.61 million shares.
The great results achieved by Microsoft Corporation (NASDAQ:MSFT) last year have not gone unnoticed by major hedge funds, several of which have been purchasing large amounts of shares. Mr. Dalio’s firm was particularly optimistic regarding the company over the past months, disclosing a stake of 601,000 common shares, and revealing a quarterly increase of 586,400 shares relative to its previous 13F filing. Although share prices have dropped around 5% year-to-date, Microsoft Corporation (NASDAQ:MSFT)’s stock gained more than 24% in 2014. Furthermore, analysts project a good 2015 for the company, which counts significant backing from Jeffrey Ubben’s ValueAct Capital. Amongst the funds we track, Mr. Ubben’s firm ranks as Microsoft’s largest shareholder among institutional investors, with a stake of 74.24 million shares, that account for 23% of the fund’s equity portfolio.
Finally, Mr. Dalio’s fund also held Intel Corporation (NASDAQ:INTC) amongst its top picks for the fourth quarter, revealing ownership of 709,200 shares. Although this stock has been part of its equity portfolio for several years, the investment firm has not abandoned its bullish stance. In fact, Bridgewater Associates has benefitted greatly from the stock’s solid growth trajectory, which has seen share prices rise by approximately 68% over the past five years. 2014 was a particularly profitable year for Intel Corporation (NASDAQ:INTC)’s shareholders, as the stock gained more than 41%. Hence, it comes as little surprise that numerous institutional investors are backing the company, including Ken Fisher’s Fisher Asset Management, which disclosed ownership of 19.02 million shares at the end of 2014.
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