We recently published a list of Bill Gates’ 10 Stock Positions with Huge Upside Potential. In this article, we are going to take a look at where Caterpillar Inc. (NYSE:CAT) stands against other top stocks in Bill Gates’ portfolio 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.
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).
A customer service employee engaging with customers while providing retail services.
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.
Overall, CAT ranks 8th on our list of top stocks in Bill Gates’ portfolio with huge upside potential. While we acknowledge the potential of CAT 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 CAT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
