Below is the list of the top 5 stock picks of Ray Dalio’s Bridgewater Associates. For a detailed discussion about what Ray Dalio doing these days and his investment philosophy please see What Ray Dalio Is Doing These Days – Top 10 Stock Picks in 2023.
5. Costco Wholesale Corporation (NASDAQ:COST)
Value of Bridgewater Associates’ 13F Position: $434 million
Number of Hedge Fund Shareholders: 68
Costco Wholesale Corporation (NASDAQ:COST) stock has gained 140% in the last five years. It has also outperformed the S&P 500 index so far in 2023, owing to consistent revenue and earnings growth. Costco Wholesale Corporation (NASDAQ:COST) reported net sales of $18.42 billion in August 2023, up 5% from $17.55 billion the previous year. In addition, the company reported net sales of $232.95 billion for the 52 weeks, up 4.6% from $222.70 billion during the same period last year. Furthermore, market analysts expect Costco Wholesale Corporation (NASDAQ:COST) to generate high single-digit to double-digit percentage growth in the coming years. Overall, Costco Wholesale Corporation (NASDAQ:COST) appears like a solid stock to hold for the long term due to its potential to generate a sustainable share price and dividend returns for shareholders.
In the second quarter earnings call, RiverPark Advisors, an investment advisory firm, highlighted confidence in Costco Wholesale Corporation (NASDAQ:COST). Here is what the firm stated:
“Costco Wholesale Corporation (NASDAQ:COST), founded in 1983, is the world’s third-largest retailer with 850 stores, $240 billion in revenue and 68 million members spread across North America, Europe, Asia, and the Southern Pacific Region. The company is known for its strong value proposition driven by high-quality low-cost offerings including a well-regarded private-label brand. Costco regularly ranks at the top of customer surveys related to brand trust, product price and quality, and all-around experience. Historically, 90% of the company’s shoppers renew their memberships, which generate more than 50% of operating income.
Through expanding market share, new store openings, increasing member productivity, and omnichannel expansion, we believe the company can grow revenues annually in the high single-digit percentage range. This revenue growth should yield steadily growing margins and EPS growth in the low-to-mid-teens, which should drive shareholder returns in the same range.”
4. PepsiCo, Inc. (NASDAQ:PEP)
Value of Bridgewater Associates’ 13F Position: $475 million
Number of Hedge Fund Shareholders: 70
PepsiCo, Inc. (NASDAQ:PEP) is one of Ray Dalio’s Bridgewater portfolio’s largest holdings. Because of its strong brand recognition, extensive global footprints, and ability to generate sustainable growth revenue and earnings, it is one of the most dependable consumer staples companies. Its shares surged more than 55% in the past five years while the company’s dividend growth history spans over 50 years.
In the latest quarter, the company generated organic sales growth of 13% compared to a consensus growth estimate of 10%. Moreover, its core earnings per share of $2.09 per share comfortably came ahead of the consensus estimate of $1.97. PepsiCo expects full-year organic revenue growth of 10% compared to the previous estimate of 8%, and earnings per share in constant currency to increase 12% from last year. As of the end of the second quarter, PepsiCo was in 70 hedge fund portfolios, according to data tracked by Insider Monkey. This is down slightly from 72 hedge fund positions in the previous quarter. Terry Smith’s Fundsmith LLP was the largest hedge fund investor in the company.
3. The Coca-Cola Company (NYSE:KO)
Value of Bridgewater Associates’ 13F Position: $494 million
Number of Hedge Fund Shareholders: 62
The Coca-Cola Company (NYSE:KO) is Ray Dalio’s third largest stockholding. The firm raised its stake in the company by 1% during the June quarter to 8.2 million shares. After Warren Buffett’s Berkshire Hathaway, Ray Dalio Bridgewater is the second largest hedge fund investor in the company. Like PepsiCo, Inc. (NASDAQ:PEP), The Coca-Cola Company (NYSE:KO) is also one of the most reliable stocks in the consumer staples sector. The company has raised dividends in the past 60 consecutive years. In the latest quarter, it exceeded analysts revenue and earnings expectations and the company raised its full-year adjusted organic revenue growth guidance to 9% from 8.4% consensus.
According to Insider Monkey’s database, 62 hedge funds held stakes in The Coca-Cola Company (NYSE:KO) as of the end of Q2 2023.
2. Johnson & Johnson (NYSE:JNJ)
Value of Bridgewater Associates’ 13F Position: $526 million
Number of Hedge Fund Shareholders: 88
Although Ray Dalio’s firm has slashed 12% of its stake in Johnson & Johnson (NYSE:JNJ) in the second quarter to 3.18 million shares, it remains the second largest stockholding in its portfolio. So far in 2023, healthcare companies have struggled due to declining sales of COVID-related products. However, JNJ continues to generate healthy revenue and earnings growth. In the second quarter, its revenue increased 6% year on year, while earnings per share increased 8.9% to $1.96. JNJ is also known for its high dividends and long dividend growth history. It is also one of the dividend aristocrats.
At the end of the June quarter of 2023, Johnson & Johnson (NYSE:JNJ) was in 88 hedge funds, according to Insider Monkey’s database.
1. The Procter & Gamble Company (NYSE:PG)
Value of Bridgewater Associates’ 13F Position: $700 million
Number of Hedge Fund Shareholders: 74
The Procter & Gamble Company (NYSE:PG) is another dependable name in Ray Dalio’s portfolio that investors can hold for the long term. Companies with a broad global presence and strong brand recognition, such as PG, can thrive in any business cycle. This is reflected in its dividend growth history dating back to 66 years. Its stock has also been steadily rising, up nearly 85% in the last five years. Its future growth prospects appear promising, with the outlook for mid-single-digit percentage year-over-year revenue and earnings growth.
According to data by Insider Monkey, The Procter & Gamble Company (NYSE:PG) was in 74 hedge fund portfolios as of the end of the second quarter.
You can also take a look at the 10 Best Stocks for Beginners with Little Money According to Reddit and 15 Worst Performing Dividend Stocks YTD.
