In this article, we talk about 5 long-term stock picks in billionaire Ray Dalio’s portfolio. If you want to see more stocks in this selection, check out Billionaire Ray Dalio’s 10 Long-Term Stock Picks.
5. Costco Wholesale Corporation (NASDAQ:COST)
Bridgewater Associates’ Stake Value: $566.5 million
Percentage of Bridgewater Associates’ 13F Portfolio: 2.86%
Number of Hedge Fund Holders: 69
Costco Wholesale Corporation (NASDAQ:COST) is an American multinational corporation that engages in the operation of membership warehouses, leading as one of the biggest retailers in the world across several selected categories. Ray Dalio’s hedge fund holds $566.5 million worth of shares in the company as of Q3 2022. He has been raising his stakes in the company since Q2 2020.
Deutsche Bank analyst Krisztina Katai lowered her price target on Costco Wholesale Corporation (NASDAQ:COST) to $578 from $581 but maintained a Buy rating on the shares of the company on November 30. According to the analyst, investors should stick with the “winners” in retail.
On November 22, BofA analysts added Costco Wholesale Corporation (NASDAQ:COST) to the firm’s “US 1 List,” which represents a collection of the best investment ideas that are drawn from the universe of Buy-rated, U.S.-listed stocks covered by BofA Global Research fundamental equity research analysts.
As of the close of Q3 2022, 69 hedge funds tracked by Insider Monkey owned stakes in Costco Wholesale Corporation (NASDAQ:COST), up from 64 in the previous quarter. These stakes have an aggregate value of over $4.42 billion. With stakes over $1.2 billion, Fisher Asset Management owned the largest position in the company in Q3.
Cooper Investors shared its outlook on Costco Wholesale Corporation (NASDAQ:COST) in its Q3 2022 investor letter. Here’s what the firm said:
“The US economy continues to run hot – the labour market is extremely tight and a number of executives we spoke to described their challenges in retaining staff and preventing competitors from poaching talent. Industrial companies in particular continue to see record backlogs, with the easing of logistics and supply chain constraints only just starting to have an impact on deliveries and lead times.
In terms of inflationary pressures, the vast majority of our holdings have been able to leverage strong market positions and stakeholder relationships to push pricing through in 2022 such that minimal impact to earnings has occurred. Clearly this is not a lever than can be pulled indefinitely but the more experienced management teams have kept some of their powder dry. Our meeting with management at Costco in Seattle was memorable for several reasons but one was their latent ability to increase member pricing which they have not done in over 5 years (and thus likely to do in 2023)…
…To conclude we’ll return to our meeting with Costco mentioned earlier. The business quality is no secret after decades of incredible execution, but the meeting gave us renewed conviction around Value Latencies in terms of the runway for growth, the focus on enhancing customer value, Costco’s vast buying power (it purchases 30% of the world’s jumbo cashews as one example) and management’s feral focus on the business model and cost discipline.”
