In this article, we will take a look at the top 10 stocks in Harvard University’s stock portfolio.
When it comes to college prestige, Ivy League institutions lead the rankings. For an investment that can approach $60,000 per year in tuition and fees as of the 2022-2023 academic year, these schools promise an elite education and promising career prospects post-graduation. Although opinions may vary on which Ivy League school offers the best education, there’s no debate over which has the largest endowment. Harvard University’s endowment stands at an impressive $53.2 billion, bolstered by generous donations and strategic investments managed by the Harvard Management Company (HMC).
Founded in 1974, Harvard Management Company provides a dedicated funding stream that supports the university’s teaching and research, contributing over one-third of Harvard’s annual operating budget. In fiscal year 2024, Harvard’s endowment distributions totaled $2.4 billion, representing 37% of the university’s annual revenue. These funds supported key areas such as financial aid, faculty, and research initiatives. The university allocated $749 million toward financial aid across its schools, including $250 million for undergraduates. Harvard’s endowment portfolio is heavily weighted toward private equity and hedge funds, with private equity comprising 39% of the portfolio and hedge funds making up 32%.
According to Harvard Management Company CEO N.P. “Narv” Narvekar, the endowment targets an 8% return, and its seven-year annualized return of 9.3% has exceeded that goal. This performance currently places it mid-tier among Ivy League and other elite institutions. While its fiscal year 2024 return did not match Columbia’s 11.5% or Brown’s 11.3%, it outpaced those of MIT, Cornell, Dartmouth, and the University of Pennsylvania. Despite fiscal year 2024 being a strong period for public equities, with the S&P 500 frequently hitting record highs, Narvekar states that HMC’s strategy of lower public equity exposure still delivered robust returns:
“In FY24, public equity and hedge fund portfolios stood out for their strong performance. This is a particularly positive indicator, since HMC’s hedge fund portfolio has less equity exposure than most hedge fund indices, yet still outperformed during a strong year for equities.”
Notably, HMC significantly reduced the endowment’s exposure to real estate and natural resources, scaling it down from 25% in 2018 to just 6% in fiscal year 2024. This strategic shift has contributed positively to the endowment’s overall returns. Large-cap technology equities, particularly in the IT sector, may have also boosted returns for the fund. Michael Markov, founder of Markov Processes International, suggested that Harvard likely benefitted from “overweighting IT and the Mag 7 relative to the broad S&P 500.” Markov considers fiscal year 2024 a success for Harvard and a testament to HMC CEO Narvekar’s strategy of overhauling the university’s complex portfolio during his seven-year tenure.
emily-karakis-T-tVt4xsCdE-unsplash
Our Methodology
For this analysis, we examined Harvard Management Company’s stock portfolio from the third quarter of 2024. The stocks are ranked based on the firm’s stake value in each holding.
Why are we interested in the stocks that hedge funds 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10. Samsara Inc. (NYSE:IOT)
Harvard Management Company’s Stake: $21.17 million
Samsara Inc. (NYSE:IOT) provides a cloud-based software platform specializing in commercial vehicle telematics, video-based driver safety, driver workflow automation, and industrial equipment monitoring. Its offerings include real-time GPS tracking, AI-powered dash cams, routing tools, and driver apps.
In Q2 FY2025, Samsara Inc. (NYSE:IOT) reported a 36% year-over-year increase in annual recurring revenue (ARR), reaching $1.264 billion. This performance was driven by the addition of 169 new customers generating over $100,000 in ARR and a record 14 customers contributing over $1 million each.
On October 11, TD Cowen raised its price target for Samsara Inc. (NYSE:IOT) stock from $46 to $56 while reaffirming a Buy rating. The update reflects confidence in Samsara’s strong momentum in acquiring multi-product customers and its potential for sustained growth.
In addition, Samsara Inc. (NYSE:IOT) has introduced the Asset Tag, an industrial-grade Bluetooth tracking device for small assets. Designed to improve asset utilization, prevent loss, and enhance worker efficiency, Asset Tag contributed $1 million in new annual contract value during the quarter.
Baron Opportunity Fund stated the following regarding Samsara Inc. (NYSE:IOT) in its Q2 2024 investor letter:
“We initiated a position in Samsara Inc. (NYSE:IOT) during the quarter. Samsara provides a cloud software platform for commercial vehicle telematics, video-based driver safety, driver workflow automation, and industrial equipment monitoring. Its software collects and analyzes data from sensors and cameras installed in its customers’ commercial trucks, construction equipment, warehouses, and other assets, helping companies visualize and improve the state of their operations. More than 17,500 customers in the transportation, field services, construction, utilities, and other industries have adopted Samsara, and last year the company became one of the fastest software companies ever to reach $1 billion in annual recurring revenue (ARR). Samsara has been winning share from competitors in the $51 billion connected fleet software market due to its superior cloud native architecture, ability to address multiple use cases in a single platform, and its rapid product release cycle. As Samsara continues to expand its connected asset base, it is building an unmatched data asset that it is using to drive better outcomes for its customers. Capturing more than 9 trillion data points from over 44 billion hours of camera footage across millions of miles driven, Samsara uses AI to help companies optimize their vehicle routes, prevent accidents, improve asset utilization, reduce fuel expenses, and lower insurance premiums. In 2023, across its customer base, the company prevented 200,000 accidents and reduced carbon emissions by 2.3 billion pounds. We see a long runway for growth as Samsara expands in existing accounts and wins new logos. Samsara is less than 50% penetrated in its existing customers’ vehicle fleets and has a significant opportunity to cross-sell newer non-vehicle products (which already account for $125 million of ARR) into its base. The company has also increased its customer count by more than 20% year-over-year every quarter and identified hundreds of thousands of potential new accounts to win. As it has scaled, Samsara has delivered healthy operating leverage, and we think free cash flow margins can ultimately expand beyond 20% longer term.”
9. PureCycle Technologies, Inc. (NASDAQ:PCT)
Harvard Management Company’s Stake: $23.73 million
Headquartered in Orlando, Florida, PureCycle Technologies Inc. (NASDAQ:PCT) specializes in recycling polypropylene plastic waste into ultra-pure recycled polypropylene resin. This material has diverse applications, including packaging and labeling for consumer products across various industries.
On October 18, Cantor Fitzgerald initiated coverage on PureCycle Technologies Inc. (NASDAQ:PCT)s with an Overweight rating and a $14 price target. The firm highlighted PureCycle’s unique position in the recycling industry, emphasizing its patented technology and first-mover advantage in transforming polypropylene plastic waste into renewable resources. Analysts pointed to the company’s significant total addressable market (TAM) and differentiated approach as key growth drivers.
In addition, PureCycle Technologies Inc. (NASDAQ:PCT) secured $90 million in funding from Sylebra Capital Management and Samlyn Capital. This investment is expected to support the company’s Augusta project and enhance its commercial recycling operations. The company has begun initial sales and anticipates revenue growth in the fourth quarter. Operationally, PureCycle Technologies Inc. (NASDAQ:PCT) implemented CP2 removal improvements at its Ironton facility, boosting production rates. It also secured a bond sale agreement, further strengthening liquidity by $30 million.
8. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Harvard Management Company’s Stake: $84.88 million
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), based in Taiwan, supplies integrated circuits and other semiconductor devices to leading tech companies like Apple and NVIDIA.
For the third quarter, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) reported net revenue of $23.5 billion, marking a 36% year-over-year increase. The company’s gross margin also rose to 57.8%, up from 54.3% in the same period last year. Looking ahead, the company expects fourth-quarter revenue to range between $26.1 billion and $26.9 billion. This guidance represents a 13% sequential increase and a 35% year-over-year increase at the midpoint. Moreover, during the Q3 earnings call, TSMC Chairman and CEO C.C. Wei emphasized that AI demand is “real” and highlighted TSMC’s unmatched industry growth.
“We have talked to our customers all the time, including our hyperscaler customers who are building their own chips. And almost every AI innovator is working with TSMC.”
On October 19, Needham raised its price target for Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) shares from $210 to $225, anticipating further upside in gross margins. Last year, Needham had forecast TSMC’s 2025 revenue at $110 billion, well above the then-consensus estimate of $96 billion. With TSMC consistently delivering “beat-and-raise” quarters, consensus estimates have since aligned with Needham’s projections, reflecting strong market confidence in TSMC’s growth outlook. For 2024, TSMC’s revenue is expected to reach approximately $90 billion, positioning the company for an estimated 23% growth in 2025.
Baron Global Advantage Fund stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q3 2024 investor letter:
“We established a small position in Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM). Morris Chang founded TSMC in 1987, as the world’s first dedicated semiconductor foundry. Until then, semiconductor chips were always designed and manufactured by the same company. TSMC introduced a groundbreaking new business model, in which it acted purely as a contract manufacturer, which proved to be highly successful. TSMC maintained a focus on improving its manufacturing process technology and enabled the emergence of innovative fabless design companies, including NVIDIA, Apple, and Qualcomm, who became TSMC’s key customers. Today, TSMC has a more than 60% share of the total semiconductor foundry market and over 90% share in leading-edge manufacturing. TSMC enjoys high barriers to entry given the ever-increasing cost and technological complexity of semiconductor manufacturing while benefiting from economies of scope as once leading-edge manufacturing becomes lagging edge on fully depreciated equipment. TSMC also benefits from scale– higher profits lead to higher R&D and capex investments, allowing for further technological differentiation, resulting in more profits. We believe TSMC will sustain strong double-digit earnings growth for years to come, driven by continued market share gains, strong pricing power, and structural growth in AI demand. According to C.C. Wei, TSMC’s CEO, “almost all the AI innovators are working with TSMC to address the insatiable AI-related demand.”6 Management forecasts that revenue from server AI chips, such as GPUs and other AI accelerators, will grow at a 50% CAGR from 2022 to 2028 and account for more than 20% of TSMC’s revenue by 2028. We except further long-term upside from the eventual proliferation of edge AI devices, including AI smartphones and AI PCs, which will require significantly more computing power and drive even stronger demand for TSMC’s leading-edge technology.”
7. Broadcom Inc. (NASDAQ:AVGO)
Harvard Management Company’s Stake: $89.6 million
Broadcom Inc. (NASDAQ:AVGO) ranks among the world’s largest technology companies, with operations spanning the hardware and software sectors. The company’s primary strength is in hardware, as it supplies networking and custom chips across diverse applications.
In its third quarter, Broadcom Inc. (NASDAQ:AVGO) reported $13.1 billion in revenue, a 47% year-over-year increase driven by strong AI revenue, VMware bookings, and robust non-AI semiconductor sales. Looking ahead to Q4 2024, Broadcom Inc. (NASDAQ:AVGO) expects AI revenue to grow 10% sequentially, reaching $3.5 billion, which would bring the annual AI revenue to $12 billion, largely fueled by ethernet networking and custom AI accelerators for data centers.
On November 6, Bank of America reiterated a Buy rating on Broadcom Inc. (NASDAQ:AVGO), projecting strong AI revenue growth with a CAGR of 30-35% in the coming years due to the company’s leadership in AI computing and networking and its strong free cash flow. However, BofA adjusted its fiscal 2025 earnings forecast for the company, citing “seasonal headwinds” linked to a product transition for Google’s Tensor Processing Unit (TPU), which may impact early-year revenue. This effect is expected to be offset by new AI and networking contracts, along with increased content opportunities with Apple, potentially leading to an adjusted EPS of $7.31 by 2026.
6. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Harvard Management Company’s Stake: $93 million
Advanced Micro Devices, Inc. (NASDAQ:AMD), headquartered in Santa Clara, California, is a leading global semiconductor company known for designing computer processors and related technologies for both business and consumer markets. The company operates through several key segments, including Data Center, Client, Gaming, and Embedded.
In the third quarter, Advanced Micro Devices, Inc. (NASDAQ:AMD) reported revenue of $6.8 billion, reflecting an 18% increase year-over-year. This growth was driven by strong sales of EPYC and Instinct data center products, as well as high demand for Ryzen PC processors. The Data Center segment achieved a record revenue of $3.5 billion, a 122% increase from the previous year, while Client segment revenue grew by 29%.
On October 31, Baird reaffirmed its positive outlook for AMD, maintaining an Outperform rating with a $175 price target. The firm expects significant growth in AMD’s artificial intelligence revenue by 2025, projecting that even capturing just 5% of the AI GPU market could signal strong performance. This growth is anticipated to come as AMD continues to gain market share in both the Data Center CPU and Client CPU markets. Baird forecasts a nearly 25% year-over-year revenue surge for AMD in 2025, a growth rate that outpaces most other semiconductor companies.
5. NVIDIA Corporation (NASDAQ:NVDA)
Harvard Management Company’s Stake: $115.1 million
NVIDIA Corporation (NASDAQ:NVDA) is a leader in graphics computing and networking solutions, with high demand for its GPUs, especially in gaming and AI applications.
On October 29, NVIDIA Corporation (NASDAQ:NVDA) unveiled its new Enterprise Reference Architectures, which are blueprints designed to help partners and customers build AI factories. More recently, on November 6, the Wall Street darling announced a collaboration with Hugging Face to advance open-source AI robotics research and development.
As NVIDIA Corporation (NASDAQ:NVDA) prepares to report its October quarter earnings on November 20, Citi anticipates a “smaller ‘beat & raise’” due to the company’s ongoing transition to the Blackwell chip series. Citi analyst Atif Malik expects results to align closely with projections, with total and data center sales forecasted at $33 billion and $29 billion, slightly below the consensus estimates of $34 billion and $30 billion. For the January quarter, Malik raised the data center forecast, anticipating an additional $3-4 billion in sales from Blackwell, as NVIDIA Corporation (NASDAQ:NVDA) has resolved production issues but remains supply-constrained. Citi now estimates January quarter total and data center sales at $36.5 billion and $32 billion, just below market expectations of $37.5 billion and $33 billion, with a projected gross margin of 73%—approximately 30 basis points under consensus due to a higher mix of H200 chips.
Polen Focus Growth Strategy stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its Q3 2024 investor letter:
“In a reversal from the past two quarters, NVIDIA Corporation (NASDAQ:NVDA) represented our top relative contributor this quarter, despite the modest underperformance, declining -1.7%. In many ways, NVIDIA was a microcosm of the broader market’s heightened volatility. Beneath the placid surface, the company experienced a 27% drawdown followed by a +31% rally, only to repeat the cycle with a -21% drawdown followed by a subsequent 20% rally to finish the quarter. In our view, the stock’s volatility goes beyond fundamental business drivers, but the company in turn benefitted from increasing capital spending budgets from cloud service providers and large enterprises for generative AI (“GenAI”) infrastructure spending. Simultaneously, the stock endured weakness related to the delayed next-generation Blackwell chip, and an earnings forecast that exceeded expectations, albeit not as much as some investors hoped. While we continue to believe NVIDIA is a highly advantaged business, with significant demand for their chips and servers ahead of the need for that hardware from real-world businesses, we are cautious about its growth sustainability since it lacks recurring revenue.”
4. Light & Wonder, Inc. (NASDAQ:LNW)
Harvard Management Company’s Stake: $130.8 million
Light & Wonder, Inc. (NASDAQ:LNW) is a global, cross-platform gaming company focused on content and digital markets. Its operations are divided into Gaming, SciPlay, and iGaming segments. The company offers its gaming products and services to commercial casinos, Native American casinos, and wide-area gaming operators, including licensed betting offices (LBOs) and bingo operators in the UK and Europe.
For the third quarter, Light & Wonder, Inc. (NASDAQ:LNW) reported earnings of $1.34 per share, surpassing analysts’ expectations of $1.16 per share. This marks a significant improvement from earnings of $0.81 per share in the same period last year, representing an earnings surprise of 15.52%. In the previous quarter, the company had also exceeded expectations, posting earnings of $1.42 per share, against an expected $1.04, resulting in a 36.54% surprise.
Earlier in October, B.Riley resumed coverage of Light & Wonder, Inc. (NASDAQ:LNW) with a Buy rating and raised its price target to $120. The firm highlighted the company’s market position, noting that its enterprise value to earnings before interest, taxes, depreciation, and amortization (EV/EBITDA) ratio is about 40% lower than its closest peer. Despite recent challenges, such as a stock price decline following a preliminary injunction related to its Dragon Train franchise, B.Riley views these developments as presenting an attractive entry point for investors.
3. Booking Holdings Inc. (NASDAQ:BKNG)
Harvard Management Company’s Stake: $155.4 million
Booking Holdings Inc. (NASDAQ:BKNG) is a leading global player in the online travel industry, operating in over 220 countries with a portfolio of well-known brands, including Booking.com, Priceline, Agoda, KAYAK, and OpenTable. The company offers a comprehensive range of services, including hotel reservations, car rentals, airline tickets, cruise bookings, and vacation packages.
In the third quarter, Booking Holdings Inc. (NASDAQ:BKNG) delivered strong financial results, with an 8% year-over-year growth in room nights booked, totaling nearly 300 million. Revenue rose to $8 billion, reflecting a 9% increase from the prior year. The platform now features over 29 million listings and approximately 3.4 million properties, as the company continues to expand into new regions and develop innovative products and services.
On November 15, BTIG maintained its Neutral rating on Booking Holdings Inc. (NASDAQ:BKNG), citing positive trends in the current quarter. The firm highlighted a quarter-to-date acceleration in reservations, particularly in October and early November, suggesting growth for the fourth quarter could surpass Q3 by about four percentage points. While it is too early to revise forecasts, the potential for low double-digit room night growth has emerged, exceeding both market expectations of 8% and the company’s guidance of 6-8%.
2. Alphabet Inc. (NASDAQ:GOOGL)
Harvard Management Company’s Stake: $198.1 million
Alphabet Inc. (NASDAQ:GOOGL) is a leading technology company with a diverse portfolio, including Google Services, Google Cloud, and Other Bets. The company offers products such as ads, Android, Chrome, Search, and YouTube, maintaining dominance in the search market while leveraging artificial intelligence to enhance user experiences.
On October 29, Alphabet Inc. (NASDAQ:GOOGL) reported its third-quarter results for fiscal 2024. The company saw a 15% year-over-year increase in consolidated revenue, reaching $88.3 billion. A key driver of this growth was the Google Cloud segment, which includes Google Workspace. Revenue from Google Cloud surged 35% year-over-year, primarily fueled by AI infrastructure and generative AI solutions within Cloud Platform services.
BMO Capital Markets raised its price target for Alphabet Inc. (NASDAQ:GOOGL) to $217 from $215, maintaining an Outperform rating on the stock. This adjustment reflects the company’s strong performance across its business segments. BMO’s analysis noted the acceleration in Alphabet’s cloud revenue and highlighted the company’s successful search monetization efforts. Additionally, the growth of AI Overview Ads on mobile is expected to drive further expansion, with a global rollout anticipated after 2025.
Cooper Investors Global Equities Fund (Hedged) stated the following regarding Alphabet Inc. (NASDAQ:GOOGL) in its Q3 2024 investor letter:
“Alphabet Inc.’s (NASDAQ:GOOGL) operating performance remains strong with sales growing 14% in the most recent quarter. Highlights included the ongoing secular growth of digital advertising driving Google search (+14%), YouTube’s continued success as a leading content platform (+13%) and the performance of the Cloud business (+29%). In conjunction with this strong sales momentum, Alphabet’s increased focus on expenses is delivering margin expansion such that Operating Income grew 26%.
Despite this operational momentum, Alphabet’s share price declined 11% in the quarter as a federal judge ruled against the company in its case with the US Department of Justice. The case pertains to Google’s monopolisation of both the search and digital advertising markets which is claimed to limit competition and innovation and/or in
Potential remedies include prohibiting exclusive agreements which make Google the default search engine on Apple or Samsung devices, forcing Alphabet to share its advertising technology with rivals, or in the extreme breaking the company apart. The timing and outcomes remain somewhat uncertain however we remain of the belief that at the fundamental level Alphabet’s products are best of breed across several verticals and are benefitting from secular industry trends and that these factors will be the ultimate determinant of long-term shareholder returns.”
1. Meta Platforms, Inc. (NASDAQ:META)
Harvard Management Company’s Stake: $681.4 million
Meta Platforms, Inc. (NASDAQ:META) is a leading technology company known for its popular products, including Facebook, Instagram, and WhatsApp, as well as its advancements in AR/VR technology.
In recent months, Meta Platforms, Inc. (NASDAQ:META) has leveraged its expertise in artificial intelligence and augmented reality, launching its first AR glasses, Orion, in September. Additionally, the company also introduced its most affordable mixed-reality headset, the Meta Quest 36.
On November 13, Monness Crespi Hardt updated its outlook for Meta Platforms, Inc. (NASDAQ:META), raising its price target to $650 from $620, while maintaining a Buy rating on the stock. The firm noted Meta’s strong performance relative to Alphabet Inc. over the past year, highlighting a market preference for META shares. The firm now offers a more favorable view of Meta’s prospects.
Rowan Street Capital stated the following regarding Meta Platforms, Inc. (NASDAQ:META) in its Q2 2024 investor letter:
“We are pleased to report that Meta Platforms, Inc. (NASDAQ:META), our largest position in the fund, has delivered a remarkable performance, +450% since our November 2022 note. Our investment in Meta dates back to 2018, with an average cost basis of approximately $172 per share. Today, the stock trades around $535, reflecting a 3x return over the six-year holding period, equating to a 20% annualized return.
We would like to remind you that achieving these types of returns is never a straight path. From time to time, we might experience volatility — that’s simply part of the investment journey. In fact, wealth creation and volatility go hand in hand. There’s no escaping it; it’s the “price of admission” the market demands. If you take a look at the chart below, you’ll notice the drawdowns META stock has faced over the years, with 2022 standing out as a particularly challenging period, where the stock saw a 75% drop….. ” (Click here to read the full text)
While we acknowledge the potential of META, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than META but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
