In this article, we will take a look at Bill Gates’ 10 Stock Positions with Huge Upside Potential.
Bill Gates became the youngest billionaire back in 1987 when he took Microsoft public, and he has been a billionaire since then. Gates has contributed a huge amount of his wealth to philanthropic activities and intends to donate 99.96% to charity when he dies. To oversee his philanthropic endeavours, Gates founded the Bill & Melinda Gates Foundation Trust. The trust oversees investment assets, with Bill and his wife, Melinda French, serving as trustees.
Read More: 10 Best Stocks to Buy According to Bill Gates
Michael Larson at Cascade Asset Management Company manages Gates’ wealth and investments. Larson also serves as the chief investment officer for the Bill & Melinda Gates Foundation. Cascade has been managing Bill Gates’ investments since 1994. Larson has helped Gates grow his wealth from under $10 billion to almost $130 billion.
Bill Gates’ Take on Tariffs?
Recently, Bill was asked about the tariffs during a CNBC interview celebrating the 50th Anniversary of his company, to which he replied that he doesn’t know what the economic effect will be, but so far it’s just on goods. “Eventually, will it be on services? Who knows?” he added. He said that politicians should be focusing more on AI, which they are not. He said that we will adjust, and AI is the biggest trend today.
Before the elections, Gates pointed out that tariffs will slow down the overall welfare, and the ripple effect of tariffs will impact innovation in the U.S.
Bruce Kasman, the chief economist at JP Morgan Chase, now expects the chance of a global recession to be around 60% compared to his previous estimate of 40%.
As of Q4 2024, the Gates Foundation reported managing $42.28 billion in the 13F securities. The tech and industrial goods sectors represent 29% and 26.3% of the portfolio, respectively. The finance sector accounted for nearly 21% of the fund’s portfolio. In that premise, let’s take a look at Bill Gates’ 10 Stock Positions with Huge Upside Potential.
Bill Gates
Our Methodology
We searched through Bill & Melinda Gates Foundation Trust’s Q4 2024 13F filings to identify the top stocks in Bill Gates’ portfolio. The stocks are ranked in ascending order of the analyst upside, as of April 22. We have also mentioned the number of hedge funds holding stakes in these stocks. Data for the number of hedge fund investors for each stock was taken from Insider Monkey’s database, updated as of Q4 2024.
Why are we interested in the stocks that hedge funds and billionaire investors pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Bill Gates’ 10 Stock Positions with Huge Upside Potential
10. Veralto Corporation (NYSE:VLTO)
Analyst Upside: 17.27%
No. of Hedge Fund Holders: 43
Veralto Corporation (NYSE:VLTO) offers technological solutions to monitor and protect major resources worldwide. Its services include water analytics, water treatment, packaging, marking and coding, and colour solutions. The company operates through two segments including Water Quality (WQ) and Product Quality & Innovation (PQI).
Veralto Corporation (NYSE:VLTO) is set to acquire Austria-based company Aquafides for almost $20 million. Aquafides improves Trojan Technologies’ ability to serve European customers. The company will add to Veralto’s UV treatment portfolio and offer growth opportunities in this segment.
Veralto Corporation posted strong results in FY2024, with the full-year revenue in line with analyst estimates. The company’s revenue came in at $5.19 billion, up from $5.02 billion in 2023. The earnings per share exceeded analyst estimates by 1.3%, reported at $3.54 per share. One of the key drivers for the revenue was Veralto’s WQ segment, which contributed almost 60% of the total revenue. Nathan Jones from Stifel reiterates a Buy rating on VLTO shares, lowering the price target to $102 from $110. The analyst has revised following the concerns regarding a potential industrial recession amid the tariffs. However, Jones believes that despite the expected economic downturn, Veralto’s WQ and PQI segments will show resilience due to their market exposure to essential consumer goods, including food and pharmaceuticals.
9. Schrödinger, Inc. (NASDAQ:SDGR)
Analyst Upside: 24.27%
No. of Hedge Fund Holders: 19
Schrödinger, Inc. (NASDAQ:SDGR) is an AI-based computational firm focused on the discovery of molecules for drug development and materials applications. Its software platform serves academic institutions, government laboratories, and pharmaceutical and industrial clients globally. The company serves through two segments: Software and Drug Discovery.
Schrödinger, Inc. (NASDAQ:SDGR) ended 2024 with mixed results as the software revenue posted a 13% growth year-over-year, while drug discovery revenue dropped significantly. However, the company’s multi-target Novartis deal will receive up to $2.3 billion in milestones, improving the drug discovery pipeline. The company obtained a 100% software customer retention rate for customers with an annual contract value of almost $500,000. This is a great sign for the software division, which will boost the company’s revenue going forward. The software customers with an annual contract value of $5 million has doubled from 4 to 8. Schrödinger’s 2025 outlook seems optimistic, with software revenue growth expected between 12% to 16%. Joseph Catanzaro from Piper Sandler maintains an Overweight rating on the shares with a price target of $45.
8. Caterpillar Inc. (NYSE:CAT)
Analyst Upside: 27.44%
No. of Hedge Fund Holders: 62
Caterpillar Inc. (NYSE:CAT) is famous for its construction and mining equipment, along with off-highway diesel and natural gas engines and gas turbines. The company has expanded notably in the past few years and has almost doubled its FCF over the past five years. The company remains solid fundamentally and is ready to overcome the downturns from tariffs.
Caterpillar Inc. (NYSE:CAT) posted a revenue of $64.88 billion, a decline of 3% from a year ago. The company’s sales volume was impacted due to weaker demand from end users and lower dealer inventories. However, the company improved its earnings per share to $21.90 from $21.21 in 2023. Despite lower sales, the company posted a record adjusted profit per share in 2024, up by 3% year-over-year. Caterpillar generated almost $9.4 billion of ME&T free cash flow, approaching its top-end target. The services revenue reached record levels of $24 billion, growing by 4% from a year ago. The company’s backlog soared from $1.3 billion to $30 billion, reflecting massive future demand, especially in Energy & Transportation. Caterpillar returned approximately $10.3 billion to shareholders through dividends and share buybacks last year.
Caterpillar Inc. (NYSE:CAT) has pledged almost $100 million to train future workers over the next five years, leveraging digital technologies. This will improve the company’s product efficiency and improve its product quality. Kyle Menges from Citigroup maintains a Buy rating on CAT with a price target of $320.
7. Madison Square Garden Sports Corp. (NYSE:MSGS)
Analyst Upside: 30.45%
No. of Hedge Fund Holders: 42
Madison Square Garden Sports Corp. (NYSE:MSGS) is a leading professional sports company in the U.S. The company owns several arenas and sports teams in the U.S.
Paul Golding from Macquarie recently increased the price target on MSGS from $240 to $250, keeping an Outperform rating on the shares. The price upgrade follows strong Q2 FY2025 results. The company generated around $357.8 million in revenues, driven by high fan engagement and successful marketing collaborations. The quarterly revenue was 9% higher compared to Q2 FY2024.
Madison Square Garden Sports Corp.’s (NYSE:MSGS) operations remain robust with high fan enthusiasm. The company’s average combined season ticket renewal rate for the current season is almost 97%. Whereas sponsorship performance has been strong so far. The new deals and renewals with leading partners such as Lenovo and Verizon were a great boost. Apart from that, signage revenues, food, beverage, and merchandise sales also added to the strong performance in Q2. The company seems on track to end the year with another record revenue.
6. Microsoft Corporation (NASDAQ:MSFT)
Analyst Upside: 30.51%
No. of Hedge Fund Holders: 317
Microsoft Corporation (NASDAQ:MSFT) is a leading technology company and one of the big five tech firms. The company offers AI-powered cloud, business, and productivity services. Its services are focused on efficiency, security, and AI developments.
Microsoft Corporation (NASDAQ:MSFT) has led the AI infrastructure movement with its strategic collaboration with OpenAI. It remains a key part of AI infrastructure in the U.S., powering various industries. In 2024, the company’s cloud segment, which includes Azure, was the largest revenue contributor. The segment generated around 43% of the company’s total revenue. The company’s focus on enterprise customers means that its revenue streams are connected to long-term contracts, which gives it extra stability during these tough times.
Recently, Paul Chew from Phillip Securities reiterated a Buy rating on MSFT with a price target of $480 per share. The analyst is optimistic about the company’s strong position in the cloud and AI sectors. Azure is growing swiftly despite its recent slower-than-expected expansion. Moreover, Microsoft is gaining robust demand for the Office 365 suite, driven by the E5 upgrade and Copilot tools. MSFT was founded by Bill Gates, and it remains one of the top holdings of the Gates Foundation.
5. United Parcel Service, Inc. (NYSE:UPS)
Analyst Upside: 30.66%
No. of Hedge Fund Holders: 59
United Parcel Service, Inc. (NYSE:UPS) is a global package delivery and supply chain management company. Operating one of the world’s largest air and ground networks, the company covers over 220 countries and territories. The company serves through the U.S. Domestic Package, International Package, and Supply & Freight segments.
United Parcel Service, Inc. (NYSE:UPS) is expanding its shipping options. The company has introduced UPS Ground Saver and UPS Ground with Freight Pricing, intending to fulfill customer demands. The company is focused on expanding higher-value segments. For instance, healthcare is one of the fastest-growing segments for UPS, as it posted $10.5 billion in revenues. The company plans to grow the segment’s revenue to $20 billion by 2026. The company expects to grow its U.S. Domestic operating margin throughout 2025, targeting a 12% margin by Q4 2026. Raymond James analyst Patrick Tyler Brown maintains a Strong Buy rating on UPS shares with a price target of $130.
4. FedEx Corporation (NYSE:FDX)
Analyst Upside: 34.91%
No. of Hedge Fund Holders: 66
FedEx Corporation (NYSE:FDX) is a global leader in logistics, e-commerce solutions, and express shipping. It provides professional transportation, e-commerce, and business services to customers worldwide. Serving in more than 220 countries, the company operates through the following segments: FedEx Express, FedEx Ground, FedEx Freight, and FedEx Services.
FedEx Corporation (NYSE:FDX) is working on new strategies such as DRIVE, which is a program to enhance its delivery, reliability, innovation, and value every day. DRIVE leverages data and technology to improve network optimization and cost management. This program is expected to save approximately $4 billion by the end of FY2025 compared to the FY2023 baseline.
Facing the headwinds from the tariff policy, analysts are making a notable cut to the price target of FDX. Recently, Ariel Rosa from Citigroup reduced the price target on FDX from $305 to $267, maintaining a Buy rating on the shares.
Longleaf Partners Fund stated the following regarding FedEx Corporation (NYSE:FDX) in its Q1 2025 investor letter:
“FedEx Corporation (NYSE:FDX) – Global logistics company FedEx was a detractor for the quarter. The company faced macro headwinds, including tariff threats and ongoing demand weakness in the US. The company is growing market share and margins in its formerly challenged European business, and this was a driver for the Express business to report low-single-digit topline growth that turned into double-digit cash flow growth. The Freight business saw a decline like its peers, who are also wrestling with weak industrial conditions. FedEx remains on track to separate into two entities: Express and Freight. This split should provide both companies with greater financial flexibility and accountability, allowing them to be run more efficiently. The market has consistently undervalued FedEx’s Freight operations, and a large discount to UPS is no longer warranted for the Express business. Tariff headwinds will be challenging to navigate, but we are glad the company is more on offence now than it has been in previous downturns.”
3. Danaher Corporation (NYSE:DHR)
Analyst Upside: 39.16%
No. of Hedge Fund Holders: 101
Danaher Corporation (NYSE:DHR) is a leading life sciences and diagnostics innovator. The company designs, manufactures, and markets professional, medical, industrial, and commercial products and services. Danaher operates through three major segments, including Biotechnology, Life Sciences, and Diagnostics.
Danaher Corporation (NYSE:DHR) continues to maintain a healthy FCF, as it generated around $5.3 billion of FCF in FY2024. The FCF led to a net income conversion ratio of almost 135%. Recently, Barclays analyst Luke Sergott upgraded the rating on DHR from Equal-Weight to Overweight, reducing the price target from $240 to $205. Despite the price reduction, the analyst has raised the rating and emphasized that volumes in the Life Sciences sector are mainly linked to commercialized drugs, adding to the company’s stable business foundation. Sergott believes that Danaher’s diagnostics stability and bioprocessing momentum will be sufficient to counterbalance any potential weakness in the Life Sciences sector.
Andvari Associates stated the following regarding Danaher Corporation (NYSE:DHR) in its Q1 2025 investor letter:
“For the handful of companies in Andvari portfolios that do make physical goods, they all share a mitigating factor: they all have above-average pricing power. The source of their pricing power stems from selling products that are critical to the end user and yet are a small proportion of the customer’s total costs. They also often benefit from high switching costs. Danaher Corporation(NYSE:DHR), Mettler-Toledo, Zoetis, and IDEXX fall into this camp, as well as TransDigm.”
2. Coupang, Inc. (NYSE:CPNG)
Analyst Upside: 40.25%
No. of Hedge Fund Holders: 87
Coupang, Inc. (NYSE:CPNG) is a South Korea-based e-commerce firm that offers a platform similar to Amazon. The company is rapidly growing its market share with high-quality and fast delivery services.
Coupang, Inc. (NYSE:CPNG) is expanding its operations in Taiwan, where its revenue is growing 23% quarter over quarter. During Q4 2024, the company posted a revenue of $7.97 billion, up by almost 20% from a year ago. For the full year, the company’s revenue increased from $24.38 billion in 2023 to $30.27 billion in 2024. With the room to gain market share and integrate add-on services such as advertising, food delivery, and TV streaming, Coupang can potentially double its revenue and profit margins in the coming years. The company is expected to post revenue between $8.60 and $8.80 billion during Q1 2025, indicating around 23% growth year-over-year. Barclays analyst Jiong Shao maintains an Overweight rating on CPNG shares, increasing the price target from $34 to $35.
1. On Holding AG (NYSE:ONON)
Analyst Upside: 53.31%
No. of Hedge Fund Holders: 49
On Holding AG (NYSE:ONON) is a Swiss-based company engaged in the athletic sports accessories industry. The company offers footwear and sports apparel. The company develops and distributes performance sports products through global distributors and independent retailers. The company also operates through its e-commerce platform and its stores.
Recently, Anna Andreeva from Piper Sandler reduced the price target on ONON shares from $62 to $55, while keeping an Overweight rating on the shares. Andreeva remains optimistic regarding On Holding despite the price target reduction. The analyst highlighted that the company’s performance has been consistent, with year-to-date trends similar to the second half of 2024. The company is seeing strong momentum in both sell-in and sell-through, as well as its direct-to-consumer operations. The company expects to outperform expectations in the second half of 2025. Andreeva emphasized that On Holding’s premium market positioning notably differentiates it from major competitors like Nike. Moreover, the company is focusing on its unique portfolio approach, helping it to avoid demand dislocation.
While we acknowledge the potential of ONON to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that has gone up since the beginning of 2025, while popular AI stocks have lost around 25%. If you are looking for an AI stock that is more promising than ONON but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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