In this article, we discuss Ken Fisher’s top tech stock picks.
Ken Fisher is an American billionaire, author, investment analyst, and the founder of Fisher Investments, a money management firm. The firm was founded in 1979 and Ken Fisher is currently serving as Executive Chairman and Co-Chief Investment Officer of the firm. He is also an author of eleven books, six of which are national bestsellers. His books mainly focus on his investment strategy. As of October 2021, Ken Fisher’s net worth stands at $6 billion.
Some of the notable tech stocks in Fisher’s portfolio include Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), Alphabet Inc. (NASDAQ:GOOG), Adobe Inc. (NASDAQ:ADBE), and salesforce.com, inc. (NYSE:CRM).
Our Methodology:
Let’s analyze our list of Ken Fisher’s top tech stock picks. The companies mentioned below are the tech stocks taken from Fisher Asset Management’s 13F portfolio as of Q2 2021.
Ken Fisher of Fisher Asset Management
Why pay attention to hedge fund sentiment while choosing stocks?
Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 86 percentage points since March 2017. Between March 2017 and July 2021, our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the S&P 500 ETF (SPY). Our stock picks outperformed the market by more than 86 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
Ken Fisher Stock Portfolio: 10 Biggest Tech Stocks
10. Cisco Systems, Inc. (NASDAQ:CSCO)
Fisher Asset Management’s Stake Value: $1,181,386,000
Percent of Fisher Asset Management’s 13F Portfolio: 0.74%
Number of Hedge Fund Holders: 60
Cisco Systems, Inc. (NASDAQ:CSCO) ranks tenth on our list of Ken Fisher’s top tech stock picks. It is an American technology company that develops and sells equipment related to networking hardware, software, and communications. Along with this, the company also offers high-tech services to its consumers.
In Q2 2021, Fisher Asset Management increased its stake in Cisco Systems, Inc. by 4% and now holds over 22.2 million shares in the company, valued at roughly $1.2 billion.
As of Q2 2021, 60 hedge funds tracked by Insider Monkey have positions in Cisco Systems, Inc., up from 59 in the previous quarter. The total value of these stakes is over $4.2 billion.
ClearBridge Investments mentioned Cisco Systems, Inc. in its Q1 2021 investor letter. Here is what the firm has to say:
“Also in IT, we added Cisco Systems, which provides IT and networking services in the form of network security, software development and cloud computing. Cisco continues to derive over 50% of its sales from on-premise deployments of its products of enterprise and small and midsize customers, while recurring revenues from software are becoming a larger part of the mix. Return-to-office enterprise spending should offer upside to its core campus business. Cisco was an early technology leader in sustainability over two decades ago, through its Internet-connecting capabilities which supported live concerts in partnership with the United Nations Development Program to raise awareness and funds to fight poverty. Cisco has very strong environmental standards (including driving lower energy consumption in IT departments through new product innovations and a longstanding goal to reduce emissions and reliance on non-renewable energy sources). Its data privacy and supply chain management policies are best in class.”
9. SAP SE (NYSE:SAP)
Fisher Asset Management’s Stake Value: $1,245,099,000
Percent of Fisher Asset Management’s 13F Portfolio: 0.78%
Number of Hedge Fund Holders: 17
SAP SE (NYSE:SAP) is a German multinational software and technology company that specializes in enterprise application software. The company ranks ninth on our list of Ken Fisher’s top tech stock picks.
As of Q2 2021, Fisher Asset Management owns over 8.8 million shares in SAP SE, valued at $1.2 billion. The hedge fund has increased its activity by 4% in the company, which now accounts for 0.78% of its 13F portfolio.
As of Q2 2021, 17 hedge funds tracked by Insider Monkey have positions in SAP SE, compared with 19 in the previous quarter. These stakes are valued at over $1.6 billion.
Polen Capital mentioned SAP SE in its Q2 2021 investor letter. Here is what the firm has to say:
“During the second quarter, the leading absolute contributors to performance (includes) SAP. German enterprise software company SAP was a leading contributor to Portfolio returns in the quarter. Over the last six months, SAP rolled out a new simplified commercial offering aimed at making it easier for their customers to transition their core enterprise resource planning software to the cloud. “Rise with SAP” will encourage customers to consider moving certain workloads to new cloudenabled software. In many cases, SAP customers standardized business processes on SAP software over decades. Contemplating and enacting transformational change is a huge undertaking for these customers. Historically, transitioning to the cloud involves many third-party helpers, so having a single, trusted partner to lead the conversation, design the road map, and own the execution is helpful. Further, as customers shift to the cloud, more peripheral workloads can be handled by SAP, thereby potentially increasing the scale of its relationship with certain customers. Not all legacy customers will adopt SAP’s cloud software, but there could be meaningful performance benefits (quicker innovation, more agility, and mobility, etc.) and cost savings for those that do.
In addition, new customers are coming aboard the SAP cloud platform, which we view as a testament to its leading capabilities. This initiative could drive cloud software revenue growth greater than 20% in the coming years, some of which will cannibalize existing onpremise software sales. That said, the potential net result is attractive and durable growth. We think SAP is capable of doubledigit earnings growth over the coming five-year period.”
8. Intel Corporation (NASDAQ:INTC)
Fisher Asset Management’s Stake Value: $1,763,741,000
Percent of Fisher Asset Management’s 13F Portfolio: 1.1%
Number of Hedge Fund Holders: 78
Intel Corporation (NASDAQ:INTC) is an American technology and semiconductor company that delivers microprocessors for major computer companies, such as Dell, Lenovo, and HP. The company ranks eighth on our list of Kin Fisher’s top tech stock picks.
In Q2 2021, Fisher Asset Management increased its stake in Intel Corporation by 5%. The hedge fund holds roughly 31.5 million shares in the company, worth $1.76 billion. The company accounts for 1.1% of the hedge fund’s 13F portfolio. On September 17, Intel Corporation announced a quarterly dividend of $0.3475 per share, in-line with the previous, yielding 2.54%.
As of Q2 2021, 78 hedge funds tracked by Insider Monkey have positions in Intel Corporation, down from 83 in the previous quarter. The total value of these stakes is over $6.76 billion.
Alger mentioned Intel Corporation in its Q1 2021 investor letter. Here is what the firm has to say:
“Short exposure to Intel also detracted from performance. Intel designs and manufactures semiconductors for the computing and communications industries. Intel’s proprietary intellectual strength and manufacturing prowess versus the competition is deteriorating, which is causing the company to lose market share and profit opportunities. The short position detracted from portfolio returns as the share price reacted positively to the announcement of Pat Gelsinger being hired as chief executive officer, a stronger-than-anticipated quarterly earnings report driven by unusually robust PC sales that we believe are unsustainable and the unveiling of “Intel Unleashed,” a new long-term program to help improve manufacturing and spur innovation. This program involves opening two fabrication plants in Arizona, which confirms Intel’s commitment to continue as an integrated design manufacturer. Importantly, Intel continues to experience issues with its next generation server chips which are disadvantaging Intel versus the competition.”
7. ASML Holding N.V. (NASDAQ:ASML)
Fisher Asset Management’s Stake Value: $2,800,226,000
Percent of Fisher Asset Management’s 13F Portfolio: 1.75%
Number of Hedge Fund Holders: 44
ASML Holding N.V. (NASDAQ:ASML) stands seventh on our list of Ken Fisher’s top tech stock picks. It is a Dutch semiconductor company that mainly manufactures chip-making equipment.
In Q2 2021, Fisher Asset Management increased its activity in ASML Holding N.V. by 5%. The hedge fund owns over 4 million shares in the company, valued at $2.8 billion. The company currently represents 1.75% of the fund’s 13F portfolio. Recently, ASML Holding N.V. announced that it expects to generate annual revenue of between €24 billion and €30 billion, due to its increased investments in technology.
As of Q2 2021, the number of hedge funds tracked by Insider Monkey having stakes in ASML Holding N.V. grew to 44 from 35 in the previous quarter. These stakes are valued at over $4.3 billion.
Like Apple Inc., Microsoft Corporation, Alphabet Inc., Adobe Inc., and salesforce.com, inc. (NYSE:CRM), ASML Holding N.V. is favored by investors and analysts in 2021.
Polen Capital mentioned ASML Holding N.V. in its Q2 2021 investor letter. Here is what the firm has to say:
“Dutch technology company ASML is the world’s only supplier of photolithography systems to leading-edge semiconductor manufacturers. It is a gross simplification and a valid point to note that ASML’s technology enables the computing technology we use today. For years, ASML engineers bent the laws of physics and enabled Moore’s Law—which states that computer chips will become faster and cost less—to progress.
Incremental innovation gains mushroomed with the rollout of Extreme Ultraviolet (EUV) technology. We were impressed by management’s recent acknowledgment that demand for ASML’s lithography systems is exceeding their prior expectations. Recent announcements by management and major customers for ASML give us even more confidence in the sustainability of growth. We believe ASML could grow its earnings at a high-teens rate over the coming five years.”
6. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Fisher Asset Management’s Stake Value: $3,121,910,000
Percent of Fisher Asset Management’s 13F Portfolio: 1.96%
Number of Hedge Fund Holders: 64
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is a Taiwanese multinational semiconductor company that manufactures and designs microchips used in communication devices. The company stands sixth on our list of Ken Fisher’s top tech stock picks.
As of Q2 2021, Fisher Asset Management holds approximately 26 million shares in Taiwan Semiconductor Manufacturing Company Limited, valued at $3.1 billion. The company represents 1.96% of the hedge fund’s 13F portfolio. In September, Taiwan Semiconductor Manufacturing Company Limited reported a 19.7% growth in its revenue at $5.44 billion, compared with the prior-year quarter.
As of Q2 2021, 64 hedge funds tracked by Insider Monkey have positions in Taiwan Semiconductor Manufacturing Company Limited, compared with 76 in the previous quarter. The total value of these stakes is over $10.6 billion.
Like Apple Inc., Microsoft Corporation, Alphabet Inc., Adobe Inc., and salesforce.com, inc. (NYSE:CRM), analysts investors are also paying attention to Taiwan Semiconductor Manufacturing Company Limited in 2021.
Wedgewood Partners mentioned Taiwan Semiconductor Manufacturing Company Limited in its Q2 2021 investor letter. Here is what the firm has to say:
“We initiated a new position in Taiwan Semiconductor Manufacturing, the largest contract manufacturer of logic semiconductors in the world. The Company has invested prodigious amounts of capital ($17 billion in 2020 alone and as much as $28 billion this year) over the past several years, at returns that suggest to us a very steep and sustainable competitive advantage. The Company has a very long runway to grow its business at a double-digit rate, driven by several favorable industry and company-specific trends including semiconductor architectural design changes, increasing manufacturing process complexity, and the proliferation of more logic semiconductors in more devices.
With over 50% market share, more than 3X that of its next largest competitor, Samsung, the Company dominates the contract foundry industry for logic semiconductors (source: Trendforce). Taiwan Semi has erected a formidable competitive barrier with its manufacturing capacity, as the Company carries over $150 billion in gross PPE (property, plant, and equipment) on its balance sheet. This would put the Company in the top echelons of invested tangible capital, globally. Further, the Company has committed to a multi-year, $100 billion capital investment program aimed at building out some of the only capacity capable of manufacturing leading-edge, sub 7 nanometers (nm) resolution integrated circuits. While semiconductor cycles are notoriously boom-bust, the Company has already secured enough demand to drive very high utilization rates for this new bleeding-edge capacity much earlier compared to previous capacity rollouts.
There are several reasons for higher sustained utilization this time around. First, integrated circuits have become extremely complex to manufacture. The Company has secured the majority of the precious few extreme ultraviolet (EUV) tools that enable the manufacture at resolutions that are substantially smaller than the wavelength of light. The Company has invested in and works very closely (on-site) with EUV tool makers to develop this technology. As a result, there is less available capacity from competitors as compared to previous cycles. Second, due to this complexity, chip developers are radically changing their
architectural designs, pushing more demand to the likes of Taiwan Semi that would otherwise be kept in-house. For example, one large customer, AMD, has had a lot of success taking CPU market share from Intel by architecting chips that have disaggregated several functions into smaller dies. Intel has recently launched a similar architectural change, but it will require it to utilize the Company’s sub-7nm capabilities, as Intel does not yet have an economic way to produce these nodes, in-house. Third, the overall demand for more computing power continues to grow as applications related to artificial intelligence require
this, and the availability of hardware instances via public cloud providers enables individuals to access a couple, a dozen, or even hundreds of processors at once. This is vastly different compared to the user-PC-server dynamic of previous cycles. Last, as has been widely reported, older, “trailing node” foundry capacity has been in short supply. These shortages have little to do with the Company’s leading-edge investments right now, as less than 40% of their revenues are derived from nodes larger than 28nm. However, we expect their current leading edge to eventually become “trailing-node.” As these smaller nodes proliferate over time, we expect fewer chip manufacturers will be capable of generating manufacturing yields that justify capital investment, driving up the long-term utilization and pricing power of the Company’s installed capacity.
Over the next several years, we expect Taiwan Semi to generate percentages of compounded revenue growth in the mid-teens along with higher margins and returns, driven by their scarce capacity in leading-edge logic manufacturing. Though the stock trades at a slight premium to the market, we think it is much more reasonable compared to where it traded earlier this year. In fact, the stock briefly went through a bear market earlier this year – after which we began purchasing shares. As the market might periodically serve up shares due to cycle-ending fears, we will look to add to our holding as the Company should be able to sustain superior growth and returns longer than previous cycles.”
5. salesforce.com, inc. (NYSE:CRM)
Fisher Asset Management’s Stake Value: $3,278,299,000
Percent of Fisher Asset Management’s 13F Portfolio: 2.05%
Number of Hedge Fund Holders: 108
salesforce.com, inc. (NYSE:CRM) is an American technology and software company that focuses on a customer relationship management (CRM) platform, along with offering cloud-based solutions to its consumers. The company stands fifth on our list of Ken Fisher’s top tech stock picks.
In Q2 2021, Fisher Asset Management increased its positions in salesforce.com, inc. (NYSE:CRM) by 4%. The hedge fund now owns over 13.4 million shares in the company, valued at $3.2 billion. The company represents 2.05% of the fund’s 13F portfolio. In September, RBC Capital raised its price target on salesforce.com, inc. (NYSE:CRM) to $325, while maintaining an ‘Outperform’ rating on the shares.
As of Q2 2021, the number of hedge funds tracked by Insider Monkey having stakes in salesforce.com, inc. (NYSE:CRM) grew to 108, from 91 in the previous quarter. The total value of these stakes is over $11.7 billion.
RV Capital Management mentioned salesforce.com, inc. (NYSE:CRM) in its Q2 2021 investor letter. Here is what the firm has to say:
“Part 5: A New Investment in Salesforce.com
The assertion that mega caps can also be mispriced is a good segue to our second new investment in Salesforce.com. Salesforce is one of the largest software companies in the world with a market value of around US$ 250 bn. It is best known for its customer relationship management or “CRM” solution, known as its Sales Cloud. It has three additional clouds (“Service,” “Marketing” and “Commerce”) as well as a thriving platform business with both owned and 3rd party software solutions.
I first came across Salesforce in 2013. I was invested in Bechtle, a German company that provides companies with their in-house IT. I kept hearing about a strange new concept called “the Cloud” and wanted to get up to speed on the topic in case it was a risk to Bechtle. As a result, I picked up a copy of “Behind the Cloud”. It documents how Salesforce.com pioneered cloud-based software and revolutionised the software industry.
Since then, I have followed Salesforce from a distance and visited it several times in San Francisco. I did not consider it seriously as an investment though as for much of the period, I had not yet overcome my aversion to loss-making companies.
This changed in December last year when Salesforce announced the acquisition of Slack (a former investment of the Business Owner Fund, described in my 2020 half-year letter) for US$ 27 bn. On the date of announcement, Salesforce’s market value fell by around US$ 20 bn. Effectively, the market was saying that Slack was almost worthless, which, as an enthusiastic owner of Slack, I disagreed with. Initially, I decided to keep our Slack stock and roll it into Salesforce (as part of the consideration was in Salesforce’s own stock). As Salesforce’s price fell further in the subsequent months, I bought its stock directly to make it a full-size position post the closing of the Slack acquisition…”
4. Adobe Inc. (NASDAQ:ADBE)
Fisher Asset Management’s Stake Value: $3,634,676,000
Percent of Fisher Asset Management’s 13F Portfolio: 2.28%
Number of Hedge Fund Holders: 89
Adobe Inc. stands fourth on our list of Ken Fisher’s top tech stock picks. It is an American technology and computer software company whose software is used in multiple fields, such as graphic designing, video editing, photography, and web development.
This September, JPMorgan lifted its price target on Adobe Inc. to $680, while keeping an ‘Overweight’ rating on the shares. The firm’s analyst Sterling Auty appreciated the company’s Q3 earnings beat and sees a positive fundamental outlook. In 2021, Adobe Inc. delivered an 18.7% return to shareholders.
As of Q2 2021, 89 hedge funds tracked by Insider Monkey have positions in Adobe Inc., down from 107 in the previous quarter. The total value of these stakes is over $13 billion. Aubrey Capital Management is the company’s leading shareholder, with shares worth $9.07 billion.
Richie Capital Group mentioned Adobe Inc. in its second-quarter 2021 investor letter. Here is what the firm has to say:
“Adobe Systems (ADBE – up 24.8%) – In the last 15 years, Adobe has transformed itself into a software behemoth, more than tripling its revenue since 2010. The company is famous for its namesake PDF-reader and photo-editing software Photoshop. However, ADBE sells a full suite of software products through a recurring subscription model. The company transitioned from selling boxed software to recurring subscriptions in 2013 and revenues have grown consistently since. The company achieved $13B in revenue in 2020 with 88% Gross Margins.”
3. Alphabet Inc. (NASDAQ:GOOG)
Fisher Asset Management’s Stake Value: $4,346,132,000
Percent of Fisher Asset Management’s 13F Portfolio: 2.72%
Number of Hedge Fund Holders: 155
In Q2 2021, Fisher Asset Management increased its stake in Alphabet Inc. by 4% and holds over 1.7 million shares in the company, worth $4.3 billion. The company represents 2.72% of the hedge fund’s 13F portfolio. In Q2 2021, Alphabet Inc. reported revenue of $61.8 billion, showcasing a 61.6% growth from the prior-year quarter. In September, Jefferies lifted its price target on Alphabet Inc. to $3,325, while maintaining a ‘Buy’ rating on the shares.
Of the 873 hedge funds tracked by Insider Monkey, 155 hedge funds have positions in Alphabet Inc. in Q2, compared with 159 in the previous quarter. These stakes are valued at over $33.7 billion. With shares worth $76.1 billion, Crake Asset Management is the company’s leading shareholder.
Mawer Investment Management mentioned Alphabet Inc. in its second-quarter 2021 investor letter. Here is what the firm has to say:
“Many higher growth companies reported strong results amid the pick-up in broad economic activity including Alphabet. These higher growth companies tend to have increased sensitivity to a change in discount rates and were supported as long-term interest rates stabilized over the period.”
2. Microsoft Corporation (NASDAQ:MSFT)
Fisher Asset Management’s Stake Value: $6,721,915,000
Percent of Fisher Asset Management’s 13F Portfolio: 4.22%
Number of Hedge Fund Holders: 238
As of Q2 2021, Fisher Asset Management holds 24.8 million shares in Microsoft Corporation, valued at $6.7 billion. The company accounts for 4.22% of the hedge fund’s 13F portfolio. Recently, Morgan Stanley lifted its price target on Microsoft Corporation to $331, while keeping an ‘Overweight’ rating on the shares.
Of the 873 hedge funds tracked by Insider Monkey, 238 hedge funds have positions in Microsoft Corporation in Q2, valued at over $62.4 billion. The number of hedge funds having stakes in the company stood at 251 in the previous quarter.
Baron Opportunity Fund released its second-quarter 2021 investor letter and mentioned Microsoft Corporation in it. Here is what the firm has to say:
“Shares of Microsoft Corporation, a cloud-software leader and provider of software productivity tools and infrastructure, rose during the quarter following a strong earnings report highlighting solid demand for its broad product stack and continued momentum migrating its business to the cloud. Microsoft was a top contributor in the period because it trades at reasonable free cash flow and earnings valuations, has cloud and digital transformation tailwinds at its back, reported a solid March quarter, and beat Street expectations by a wide margin. Microsoft’s results continued to be strong across the board, with Azure cloud computing revenues up 46% in constantcurrency (“cc”) terms and commercial cloud bookings growth of 38% cc, the best in years. Microsoft also reported robust profitability growth, with operating income expanding 31% and GAAP earnings up 45%. We believe the company is well positioned for continued solid growth and profitability through market share gains as more companies look to transform and digitize their businesses as they move operations to the cloud.”
1. Apple Inc. (NASDAQ:AAPL)
Fisher Asset Management’s Stake Value: $8,883,179,000
Percent of Fisher Asset Management’s 13F Portfolio: 5.57%
Number of Hedge Fund Holders: 138
Apple Inc. tops our list of Ken Fisher’s top tech stock picks. It is an American multinational technology company that manufactures consumer electronics, smart devices, and computer software.
As of Q2 2021, Fisher Asset Management holds approximately 64.9 million shares in Apple Inc., valued at $8.9 billion. The company represents 5.57% of the hedge fund’s 13F portfolio. In Q2 2021, Apple Inc. reported revenue of $81.4 billion, up 36.4% from the prior-year quarter. The company’s iPhone sales accounted for $39.57 billion of the gross revenue, versus the estimates of $34.5 billion. In October, Morgan Stanley lifted its price target on Apple Inc. to $168, while keeping an ‘Overweight’ rating on the shares. In the past year, the stock gained 15.43%.
As of Q2 2021, 138 hedge funds tracked by Insider Monkey have positions in Apple Inc., up from 127 in the previous quarter. These stakes are valued at $145.5 billion. With over 887 million shares, worth $121.5 billion, Berkshire Hathaway is the company’s leading shareholder.
ClearBridge Investments mentioned Apple Inc. in its first-quarter 2021 investor letter. Here is what the firm has to say:
“As we actively manage holdings and position sizes, we look to regularly recycle capital into more compelling opportunities. Maintaining our valuation discipline, we sharply reduced our position in Apple, whose shares more than doubled following our initial purchase in mid-2019 with an earnings multiple rising from the low-to-mid teens to nearly 30x.”
You can also take a look at 10 Best Stocks to Buy According to Billionaire Ken Fisher and 10 Best Defensive Stocks to Buy Today According to Billionaire Ken Fisher
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This article is originally published at Insider Monkey.
