In this article, we will take a look at the 10 stocks to buy in Ken Griffin’s portfolio.
One of Wall Street’s Greatest
Ken Griffin, the visionary founder of Citadel Investment Group, launched his hedge fund in 1990 with $4.2 million, achieving unprecedented success. In 2022, Griffin’s fund delivered an extraordinary 153% return, driven by accurate bets on inflation and interest rates. With a portfolio now exceeding $518 billion, Citadel Investment Group is one of Wall Street’s most closely watched hedge funds, consistently achieving over 25% annual returns since 2016. Citadel employs a multi-strategy investment approach, combining long and short positions to capitalize on market opportunities. Its flagship fund, Wellington, anchors Citadel’s operations by investing across multiple asset classes and sectors, emphasizing diversification. In 2022, Wellington achieved an impressive 38% return, building on 26% in 2021 and 24% in 2020. Notably, the fund posted a 19.4% gain in 2019, more than double its 9.1% return in 2018.
While Griffin’s legacy is strongly tied to Citadel’s hedge fund, a significant portion of his Forbes-calculated net worth comes from Citadel Securities, valued at $22 billion after Sequoia and Paradigm acquired a small stake two years ago. Citadel Securities has redefined modern trading, challenging the traditional dominance of big banks. In just two decades, it has become the largest stock buyer and seller in the U.S.; in August, it facilitated more equity trading within its electronic network than the New York Stock Exchange’s main market. In 2023, Citadel Securities generated $2.8 billion in profit from $6.3 billion in net revenue, with an impressive $4.9 billion in net revenue achieved in the first half of 2024 alone.
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The billionaire also ranks among the top donors to outside spending groups for the 2024 election, which secured former President Donald Trump a second term. As the founder and CEO of Citadel, he contributed $100 million to conservative causes, making him the fifth-largest individual contributor to federal election spending, according to Federal Election Commission data. While Griffin has donated millions to Republican candidates, particularly since 2022, he has notably refrained from directly supporting Trump’s campaign. A self-described “Reagan Republican,” Griffin has historically favored establishment-focused Super PACs, such as the Congressional Leadership Fund.
Ken Griffin of Citadel Investment Group
Our Methodology
For this our list of the 10 best stocks in Ken Griffin’s portfolio, we examined Citadel Investment Group’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. Mastercard Incorporated (NYSE:MA)
Citadel Investment Group’s Stake: $511.35 million
Mastercard Incorporated (NYSE:MA) is a global leader in payment transaction processing, offering services that connect consumers, merchants, and financial institutions through a comprehensive payments network. Its portfolio includes credit, debit, and prepaid cards, along with mobile payment solutions.
TD Cowen recently reaffirmed a positive outlook on Mastercard Incorporated (NYSE:MA), raising the price target to $567 from $533 and maintaining a Buy rating. This update follows Mastercard’s investor day, which underscored its long-term growth strategy. The company projects sustainable double-digit growth through 2027, driven by its robust financial services ecosystem.
In its third-quarter earnings report, Mastercard Incorporated (NYSE:MA) exceeded expectations, benefiting from increased consumer spending amid stable economic conditions. Revenue from its payment network grew by 11%, while value-added services and solutions rose by 19%, now comprising 37% of total revenue. Excluding one-time costs, the company reported earnings of $3.89 per share, surpassing analysts’ forecast of $3.74.
Ithaka US Growth Strategy stated the following regarding Mastercard Incorporated (NYSE:MA) in its Q3 2024 investor letter:
“Mastercard Incorporated (NYSE:MA) is one of two leading companies (along with Visa, which we also own) that helps match information and funds between banks that have relationships with card-carrying consumers and banks that have relationships with merchants, thus ensuring payment transactions are reliable and secure. Since the company’s founding in 1966, Mastercard has benefi ted from the growth in personal consumption expenditure, the strong secular shift from cash and checks to credit and debit cards, and a highly profi table business model that generates high incremental operating margins and hence ample and growing free cash fl ow per share. During the third quarter Mastercard’s stock outperformed as an in-line earnings announcement and strong global credit growth helped pull the stock out of a six-month consolidation.”
9. Medtronic plc (NYSE:MDT)
Citadel Investment Group’s Stake: $524 million
Medtronic plc (NYSE:MDT) is a leading global medical technology company specializing in the development, manufacturing, and distribution of device-based medical therapies. It is a pioneer in robotic-assisted surgery technologies, with significant advancements in minimally invasive and spine procedures.
In the latest quarter, Medtronic plc (NYSE:MDT) achieved a 5.3% year-over-year revenue increase, driven by balanced growth across its Surgical, Neuroscience, Cardiovascular, and Diabetes segments. The company’s international operations account for 48% of its total revenue, underscoring its global reach and diversified revenue streams.
On October 15, Baird raised its price target for Medtronic plc (NYSE:MDT) to $96 from $90 while maintaining a Neutral rating. The adjustment reflects Medtronic’s consistent mid-single-digit top-line growth over the past seven quarters. Baird’s analysis suggests the company is likely to surpass consensus expectations for Q2 FY2025 revenue and adjusted earnings per share. However, the firm noted the cautious tone of Medtronic’s FY2025 guidance and highlighted the sustainability of the projected high-single-digit adjusted EPS growth for the latter half of the fiscal year.
