In its latest 13F form filed with the U.S. Securities and Exchange Commission, Steven Wishnia’s Highland Capital Management LLC disclosed its top three picks as of the end of 2014. The investment firm revealed Merck & Co., Inc. (NYSE:MRK) as its largest position, accounting for more than 5.6% of its equity portfolio. The other two stocks Mr. Wishnia’s company is betting heavily on this quarter are Microsoft Corporation (NASDAQ:MSFT) and Apple Inc. (NASDAQ:AAPL).
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Highland Capital Management LLC is an investment advisory firm that focuses primarily on managing equity and fixed income portfolios. The company was founded in 1987 and is currently headquartered in Memphis, Tennessee. Despite only counting with an investment team of six professionals, Highland Capital Management has amassed an equity portfolio valued at around $534 million. Around 30% of the companies it invests in operate in the finance industry, while the remaining 70% of its holdings are highly diversified. With Steven Wishnia as President and Managing Director, the firm has achieved a solid long-term performance. Apart from founding the predecessor company to Highland Capital Management Corp, Mr Wishnia gathered extensive experience working at SC Securities and Delphi Management Corporation.
Merck & Co., Inc. (NYSE:MRK) is a $177 billion market cap drug manufacturer and a huge player in the healthcare industry. The company offers prescription medicines, vaccines, biologic therapies, animal health, and consumer care products, providing health care solutions for patients all around the world. Last month the pharmaceutical company made headlines, when it announced it would acquire Cubist Pharmaceuticals Inc. (NASDAQ:CBST), while absorbing its net debt of $1.1 billion. Despite the negative impact of this announcement, which saw Merck’s stock drop from around $62 to $57 per share in just one week, investors remain highly bullish regarding its future performance. In 2014, the pharmaceutical company gained around 14%, almost doubling the Dow Jones Industrial Average’s 7.5% annual gain. Hence, Mr. Wishnia’s firm surely benefited from having Merck as its largest equity position for over a year.
Naturally, Highland Capital Management is not the only institutional investor with a stake in Merck & Co., Inc. (NYSE:MRK). Ken Fisher’s Fisher Assset Management for example, holds a position of more than 6.5 million shares. Ken Griffin’s Citadel Investment Group is also bullish regarding the stock, with holdings amounting to around 2.1 million shares.
The second largest holding disclosed by Mr. Wishnia’s investment advisory firm in its latest 13F filing is Microsoft Corporation (NASDAQ:MSFT), with a position of 385,300 shares. The huge technology company displayed a great performance last year, with stock prices climbing 24.5% in 2014. Hence, it comes as no surprise that the investment firm held this stock amongst its top 3 picks.
Apart from Highland Capital Management, Microsoft Corporation (NASDAQ:MSFT) is backed by numerous institutional investors. Jeffrey Ubben’s ValueAct Capital holds a huge stake in the company, amounting to 74.2 million shares, which represent 23% of the fund’s equity portfolio. Donald Yacktman’s Yacktman Asset Management is also a Microsoft bull, disclosing ownership of 56.4 million shares at the end of the third quarter.
Highland Capital Management disclosed ownership of 147,000 shares of Apple Inc. (NASDAQ:AAPL) in its latest 13F filing, making it the third largest position in the firm’s equity portfolio. Apple is not only one of the most important players in the technology industry, but is also the largest company in the world in terms of market capitalization. Furthermore, Apple’s share prices grew around 38% during 2014, making it a highly profitable position to hold on to. Hence, it comes as no surprise that in addition to Highland Capital Management, a wide range of institutional investors have added this stock to their equity portfolio. Carl Icahn’s Icahn Capital LP has been at the top of the list for some time now, and is the most important shareholder of its kind, with a stake amounting to 52.7 million shares. Fisher Asset Management has also taken a bullish stance towards Apple Inc. (NASDAQ:AAPL), holding more than 10.7 million shares by the end of the third quarter.
Disclosure: Pablo Erbar holds no position in any stocks or funds mentioned.
