In this article, we will take a detailed look at the Top 10 Stocks to Buy According to Akre Capital Management.
Akre Capital Management follows a disciplined investment philosophy centered around identifying exceptional businesses managed by honest and capable leaders who reinvest free cash flow wisely. This approach, referred to as the “three-legged stool,” emphasizes three key factors: extraordinary businesses, strong management teams, and effective reinvestment strategies. The firm’s primary objective is to compound investor capital at above-average rates while maintaining a lower level of risk compared to industry norms. Led by founder Chuck Akre until 2020, the firm has consistently adhered to this philosophy, delivering strong results over the years.
The foundation of Akre Capital’s investment strategy is built on the principle that long-term returns closely correlate with the return on an owner’s capital, assuming stable valuations and no distributions. Historically, the average return on U.S. equities has been around 9% to 10%, aligning with book value growth per share. Akre Capital seeks to outperform this benchmark by selecting businesses with superior return profiles, believing that these “compounding machines” are the best way to achieve sustainable wealth accumulation. The firm places great emphasis on patience and discipline, resisting short-term market fluctuations in favor of long-term growth.
Unlike many asset managers, Akre Capital does not rely on setting specific sell targets when acquiring shares. Instead, it evaluates potential investments with the intent of holding them indefinitely, selling only when one of the core aspects of the “three-legged stool” is compromised. This long-term approach distinguishes the firm from Wall Street’s frequent short-term focus on quarterly earnings surprises. Rather than reacting to minor earnings fluctuations, Akre Capital remains committed to businesses with solid economic fundamentals, viewing temporary price declines as opportunities to acquire high-quality companies at attractive valuations.
Another key differentiator of Akre Capital is its ability to capitalize on market inefficiencies. The firm takes advantage of Wall Street’s obsession with short-term earnings reports, often using quarterly “misses” as opportunities to invest in undervalued companies with strong long-term potential. With a focus on growth over five- and ten-year periods, Akre Capital prioritizes economic value per share rather than short-term stock price movements. This steadfast commitment to its investment philosophy has allowed the firm to consistently achieve its goal of compounding capital while mitigating risk.
Charles T. “Chuck” Akre, Jr. is a seasoned asset manager with over five decades of experience overseeing private funds, mutual funds, and separately managed accounts. He founded Akre Capital Management in 1989 after spending 21 years at Johnston, Lemon & Co., a NYSE member firm, where he gained expertise in research, asset management, and branch operations. During his time there, he developed a deep understanding of securities and investment strategies, which laid the foundation for his own firm’s approach.
From 1993 to 2000, Akre Capital Management operated under the umbrella of Friedman, Billings, Ramsey & Co. in Washington, D.C., providing Chuck with additional resources to refine and expand his investment philosophy. However, in 2000, he chose to take the firm private again, emphasizing independence and a long-term investment approach. He relocated Akre Capital to Middleburg, Virginia, a rural setting that reflected his preference for a focused and patient investment process, free from the distractions of Wall Street’s short-term mentality.
At Akre Capital, Chuck Akre’s leadership has shaped the firm’s long-term success, ensuring consistent capital growth for investors. Over the years, he has earned a reputation for his disciplined and insightful approach to asset management. Today, Akre continues to contribute his expertise as Chairman of Akre Capital Management. He works alongside John Neff, the portfolio manager of the Akre Focus Fund, ensuring that the firm’s investment principles remain intact. With decades of experience and a commitment to compounding capital at superior rates, Chuck Akre’s influence in the investment world remains significant.
As of its most recent filing for the fourth quarter of 2024, Akre Capital Management manages approximately $11.56 billion in 13F securities. The firm maintains a highly concentrated portfolio, with its top ten holdings accounting for 94.82% of total assets. This focused investment approach reflects Akre Capital’s commitment to selecting a small group of high-quality businesses with strong growth potential and disciplined management.
Charles Akre of Akre Capital Management
Our Methodology
The stocks discussed below were picked from Akre Capital Management’s Q4 2024 13F filings. They are compiled in the ascending order of the hedge fund’s stake in them as of December 31, 2024. To assist readers with more context, we have included the hedge fund sentiment regarding each stock using data from 1009 hedge funds tracked by Insider Monkey in the fourth quarter of 2024.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Top 10 Stocks to Buy According to Akre Capital Management
10. Danaher Corporation (NYSE:DHR)
Number of Hedge Fund Holders as of Q4: 101
Akre Capital Management’s Equity Stake: $407.54 Million
Danaher Corporation (NYSE:DHR) is a global conglomerate specializing in medical, industrial, and commercial products and services. Founded in 1984 by Steven and Mitchell Rales, the company is headquartered in Washington, D.C., and operates through three primary divisions: biotechnology, diagnostics, and life sciences. With a strong emphasis on scientific and technological innovation, Danaher aims to address critical health challenges and improve quality of life worldwide. Originally established as DMG, Inc. in 1969, the company underwent several transformations before adopting its current name, inspired by a Montana creek. Danaher Corporation (NYSE:DHR) was also among the first North American companies to implement Kaizen principles, focusing on continuous improvement and operational efficiency.
As of the fourth quarter of 2024, Akre Capital Management held 1.78 million shares of Danaher Corporation (NYSE:DHR), valued at approximately $407 million, making up 3.52% of Charles Akre’s investment portfolio. Hedge fund interest in Danaher also increased, with 101 out of 1,009 funds tracked by Insider Monkey holding positions worth nearly $7.07 billion by the end of the fourth quarter, up from 98 funds in the previous quarter. This growing investor confidence highlights Danaher’s strong market position and long-term potential.
On January 28, 2025, Danaher Corporation (NYSE:DHR) reported its fourth-quarter earnings, posting a net revenue of $6.54 billion, reflecting a 2% increase year over year. However, the company’s earnings per share (EPS) came in at $2.14, falling short of analyst expectations by $0.02. Analysts maintain a stable outlook for the stock, projecting 2025 revenues of $24.1 billion and a 5% increase in earnings per share (EPS) to $5.74, aligning closely with prior estimates. Despite the slight earnings miss, Danaher’s steady revenue growth and commitment to innovation reinforce its position as a key player in the healthcare and life sciences industries, making it one of the top stocks to buy according to Akre Capital Management.
Mar Vista U.S. Quality Strategy stated the following regarding Danaher Corporation (NYSE:DHR) in its Q4 2024 investor letter:
“Healthcare stocks in general, and Life Science tool businesses more specifically, ended 2024 on a downbeat as investor sentiment is still cautious on the market’s post-Covid recovery. Hopes for an above average industry growth rebound in 2025 were muted by managements’ more cautious guidance. Investor concerns over the Trump administration’s healthcare leadership and policies further dampened optimism for a strong 2025. Tariff impacts, NIH funding and Biotech/pharma spending top the list of investor concerns. We believe Mettler-Toledo’s and Danaher Corporation’s (NYSE:DHR) secular growth opportunities stay intact. Both businesses compete in key, defensible segments of the industry’s value chain and have strong pricing power and margin expansion opportunities. Long-term secular drivers for scientific research and commercialization of biologic therapeutics and molecular diagnostic should drive above-average growth for both businesses.”
9. CoStar Group, Inc. (NASDAQ:CSGP)
Number of Hedge Fund Holders as of Q4: 56
Akre Capital Management’s Equity Stake: $666.78 Million
CoStar Group, Inc. (NASDAQ:CSGP) is a leading provider of information, analytics, and marketing services for the commercial real estate industry in North America and Europe. With a market capitalization of $31.55 billion and strong gross profit margins of nearly 80%, the company maintains a solid financial position, holding more cash than debt. CoStar is expanding its workforce significantly at its Richmond operations center, where it plans to complete a new one-million-square-foot global headquarters by May 2026.
The company’s growth is driven by the success of Homes.com, now one of the most visited real estate platforms in the U.S., with an average of 110 million unique monthly visitors in Q4 2024. To support this expansion, CoStar Group, Inc. (NASDAQ:CSGP) plans to hire 500 new sales professionals and 100 market analysts to enhance content for new construction home listings. Additionally, following its acquisition of Visual Lease, the company will bring on 100 analysts to develop rent indices for clients. As part of its broader strategy, CoStar is also investing in artificial intelligence, video production, and real estate-focused news and writing. While it anticipates some workforce adjustments in 2025 due to AI-driven efficiencies, the company remains focused on optimizing performance and revenue generation.
Despite its expansion, CoStar Group, Inc. (NASDAQ:CSGP)’s recent earnings report fell short of expectations, with adjusted Q4 earnings per share at $0.15, below the analyst estimate of $0.22. However, revenue for the quarter exceeded forecasts, reaching $709 million, an 11% year-over-year increase. For the full year 2024, revenue totaled $2.74 billion, though net income declined to $139 million from $375 million. Looking ahead, CoStar projects 2025 revenue between $2.98 billion and $3.01 billion, slightly below analyst expectations. In a strategic move, the company has also made an unsolicited bid to acquire Domain Holdings Australia for $4.20 per share, subject to regulatory approvals. Analysts have responded cautiously, with Needham, Citi, and Citizens JMP all lowering their price targets for CoStar Group, Inc. (NASDAQ:CSGP) while maintaining favorable ratings, reflecting both confidence in the company’s key segments and concerns over its 2025 outlook.
Polen Focus Growth Strategy stated the following regarding CoStar Group, Inc. (NASDAQ:CSGP) in its Q4 2024 investor letter:
“We initiated a position in CoStar Group, Inc. (NASDAQ:CSGP) after a significant pullback post-3Q24 earnings. CoStar Group is a leading provider of commercial real estate information, analytics, and online marketplaces, empowering clients with comprehensive data and technology solutions to make informed business decisions. The vast majority of the company’s revenue and profits come from its monopoly-like CoStar Suite (the go-to information source for the U.S. commercial real estate market) and Apartments.com, an advantaged player in the duopolistic U.S. apartment rental market. There are very high barriers to entry and network effects in these businesses, and both are double-digit growers with over 40% profit margins and very high levels of recurring revenue. We believe the price at which we acquired CoStar reflects the value of these two core businesses, leaving significant upside potential from numerous other growth drivers in earlier stages of development. In particular, Homes.com—CoStar’s residential real estate marketplace—is a source of heavy investment that is materially depressing the company’s overall profit margins in the near term. However, leading indicators of success are already emerging, and we expect Homes.com to contribute meaningfully to future growth and at high margins. If, for some reason, they don’t succeed, we would expect the investment to be curtailed, and the core profitability to shine through again. CoStar has a cash-rich balance sheet, high recurring revenue, and the ability to compound revenue and earnings for many years to come.”
8. Roper Technologies, Inc. (NASDAQ:ROP)
Number of Hedge Fund Holders as of Q4: 54
Akre Capital Management’s Equity Stake: $770.38 Million
Roper Technologies, Inc. (NASDAQ:ROP), originally founded as Roper Industries in 1890 by George D. Roper, is a diversified industrial company based in Sarasota, Florida. Initially focused on manufacturing home appliances, pumps, and industrial products, Roper has evolved into a leading technology-driven enterprise. The company recently announced its financial results for the fourth quarter and full year ending December 31, 2024, showcasing strong growth driven by both organic expansion and strategic acquisitions. Fourth-quarter revenue increased by 16% to $1.88 billion, with 9% of the growth attributed to acquisitions and 7% to organic revenue gains. GAAP net earnings rose by 22% to $462 million, while adjusted net earnings increased by 10% to $520 million. For the full year, revenue climbed 14% to $7.04 billion, with operating cash flow reaching $2.39 billion, a 16% increase.
CEO Neil Hunn highlighted 2024 as a milestone year for Roper Technologies, Inc. (NASDAQ:ROP), with free cash flow surpassing $2 billion for the first time. The company deployed $3.6 billion toward high-quality vertical software acquisitions, including Procare Solutions, a leader in early childhood education software, and Transact Campus, which was integrated with CBORD to enhance Roper’s education and healthcare software segment. These acquisitions, combined with organic growth, contributed to a 14% increase in total revenue for the year. Adjusted EBITDA rose 13% to $2.83 billion, while adjusted diluted earnings per share (DEPS) grew 10% to $18.31. Roper Technologies, Inc. (NASDAQ:ROP) remains committed to its capital deployment strategy, reinforcing its long-term focus on sustainable cash flow growth.
Looking ahead to 2025, Roper Technologies, Inc. (NASDAQ:ROP) expects to maintain strong momentum, projecting double-digit revenue growth fueled by continued organic expansion and contributions from recent acquisitions. The company anticipates full-year adjusted DEPS of $19.75 to $20.00, with first-quarter DEPS expected between $4.70 and $4.74. Total revenue is forecasted to grow by more than 10%, with organic growth estimated at 6% to 7%. Additionally, on March 7, 2025, Roper’s Board of Directors approved a dividend of $0.82 per share, payable on April 22, 2025, to stockholders of record as of April 4, 2025.
7. American Tower Corporation (NYSE:AMT)
Number of Hedge Fund Holders as of Q4: 70
Akre Capital Management’s Equity Stake: $ 1 Billion
American Tower Corporation (NYSE:AMT) is a leading real estate investment trust (REIT) specializing in wireless and broadcast communications infrastructure. Headquartered in Boston, Massachusetts, the company owns, operates, and develops multitenant communications real estate across various countries, with a portfolio of approximately 180,000 communication sites. American Tower has maintained strong financial performance, boasting a 74.6% gross profit margin and consistently paying dividends for 15 consecutive years.
On March 17, 2025, American Tower Corporation (NYSE:AMT) announced that board member JoAnn A. Reed will not seek re-election at the upcoming Annual Meeting of Stockholders. Reed, a member of the company’s Audit Committee, will continue to serve until the meeting, with no disclosed disagreements regarding company management or operations. Her tenure has been marked by valuable contributions to financial oversight and governance. While the SEC filing did not specify the reason for her departure or name a successor, her exit marks a significant transition for the company’s leadership.
American Tower Corporation (NYSE:AMT) reported strong fourth-quarter 2024 financial results, exceeding analyst expectations with earnings per share of $2.32 versus the projected $1.77 and revenue of $2.55 billion, surpassing the forecasted $2.52 billion. With an annual revenue of $10.1 billion and a 3.2% dividend yield, the company maintains a solid market position. To manage its debt, American Tower priced $1 billion in senior unsecured notes, allocating the proceeds toward repaying existing obligations and reducing debt under its revolving credit facility. Despite challenges such as currency fluctuations and a softer U.S. leasing environment, analyst upgrades signal confidence in the company’s growth potential. Additionally, American Tower adjusted its executive compensation, revising base salaries and target cash bonuses to align leadership incentives with company performance.
Meridian Hedged Equity Fund stated the following regarding American Tower Corporation (NYSE:AMT) in its Q4 2024 investor letter:
“American Tower Corporation (NYSE:AMT) is a leading global owner and operator of wireless communications infrastructure, with a portfolio spanning the U.S. and key international markets. We hold American Tower for its exposure to the secular growth in wireless data consumption and its strategic positioning in underpenetrated emerging markets. The company benefits from long-term contracts with investment-grade wireless carriers, providing strong visibility into future cash flows. This quarter, performance was mixed. Revenue met expectations but fell short of consensus. Adjusted EBITDA declined slightly year-over year, impacted by the divestiture of its India business and elevated bad debt expense. However, organic tenant billings growth remained healthy, with U.S. and international markets posting solid growth. While we maintain conviction in American Tower’s ability to benefit from increasing data consumption and 5G network deployments, near-term currency headwinds and regional challenges warrant monitoring.”
6. Visa Inc. (NYSE:V)
Number of Hedge Fund Holders as of Q4: 181
Akre Capital Management’s Equity Stake: $1.03 Billion
Visa Inc. (NYSE:V), a global leader in financial services, specializes in electronic funds transfers and is headquartered in San Francisco, California. The company operates one of the most extensive payment networks, facilitating transactions through Visa-branded credit, debit, and prepaid cards. On January 30, 2025, Visa announced its first-quarter financial results, surpassing market expectations. The company reported earnings per share (EPS) of $2.75, exceeding analysts’ projections of $2.66, reflecting a 14% year-over-year increase. Net revenue also outperformed forecasts, reaching $9.51 billion, a 10% increase from the previous year and higher than the expected $9.35 billion. This strong financial performance was driven by increased transaction volumes and a rise in digital payments worldwide.
Visa Inc. (NYSE:V)’s strong fiscal first-quarter 2025 results reflected robust consumer spending, particularly during the holiday season, and an overall increase in payment volume. The company reported an 11% rise in net income, reaching $5.5 billion, alongside its 10% revenue growth. As digital transactions continue to gain momentum globally, Visa’s ability to leverage its vast network and technological innovations positions it well for sustained growth. By focusing on enhancing its payment ecosystem and strategic expansion, the company remains a key player in shaping the future of digital payments.
Visa Inc. (NYSE:V) is regarded as one of the top stocks to buy according to Akre Capital Management, potentially due to its dominant market position and consistent revenue generation. With 4.7 billion Visa cards accepted at 150 million merchant locations worldwide, the company earns revenue through transaction fees ranging from 1.5% to 3.5%. It has demonstrated remarkable resilience during economic downturns, including the COVID-19 pandemic and inflationary pressures, continuing to expand its revenue at an annual rate of 11% and earnings at 16% since 2014. These strong financial fundamentals reinforce its reputation as a reliable long-term investment.
Meridian Hedged Equity Fund stated the following regarding Visa Inc. (NYSE:V) in its Q4 2024 investor letter:
“Visa Inc. (NYSE:V) is the world’s largest retail electronic payments network. We hold Visa in the portfolio because of its formidable competitive moat, built on network effects spanning billions of cards and millions of merchants globally. The company continues to benefit from the secular shift toward electronic payments while expanding its portfolio to include high-growth adjacent offerings. While U.S. market penetration is mature, international markets—particularly in emerging economies, where cash usage remains prevalent— offer significant growth opportunities. Visa’s operating model demonstrates strong leverage, with incremental revenue efficiently flowing to the bottom line. This quarter, Visa outperformed expectations across key metrics, with payment volumes and transaction growth proving resilient despite macro uncertainties. Looking ahead, we anticipate continued momentum into fiscal 2025, driven by the ongoing transition to digital payments, international expansion, and the scaling of newer business lines.”
5. O’Reilly Automotive, Inc. (NASDAQ:ORLY)
Number of Hedge Fund Holders as of Q4: 63
Akre Capital Management’s Equity Stake: $1.06 Billion
O’Reilly Automotive, Inc. (NASDAQ:ORLY), commonly known as O’Reilly Auto Parts, is a leading American retailer of automotive aftermarket parts, tools, and accessories. Founded in 1957 by the O’Reilly family, the company has expanded its operations to over 6,000 stores across 48 states, Puerto Rico, and Mexico.
For the fourth quarter ending December 31, 2024, O’Reilly Automotive, Inc. (NASDAQ:ORLY)’s revenue increased by 7% to $4.10 billion, compared to $3.83 billion in the previous year. Gross profit also rose by 7% to $2.10 billion, maintaining a steady margin of 51.3%. However, selling, general, and administrative (SG&A) expenses climbed by 9%, totaling $1.36 billion. Operating income increased modestly by 3% to $739 million, while net income experienced a slight decline of $1 million, settling at $551 million. Despite this, diluted earnings per share (EPS) grew by 3% to $9.50, driven by a reduction in outstanding shares. The company’s consistent financial strength continues to support its long-term growth strategy.
In a significant corporate move, O’Reilly Automotive, Inc. (NASDAQ:ORLY) announced on March 13 that its Board of Directors approved a 15-for-1 stock split, which will be executed as a special stock dividend. The split is contingent on shareholder approval of an amendment to increase the number of authorized shares. This decision reflects O’Reilly’s commitment to broadening stock accessibility for investors and employees. CEO Brad Beckham emphasized that the stock split aligns with the company’s long-standing tradition of rewarding its team members, reinforcing the culture that has been integral to O’Reilly’s sustained success.
If approved, shareholders of record as of June 2, 2025, will receive 14 additional shares for each share held, with distribution set for June 9. The move aims to make shares more accessible to O’Reilly Automotive, Inc. (NASDAQ:ORLY)’s employees through its stock purchase program, which offers stock at a 15% discount via payroll deductions. The company believes this initiative will further strengthen employee engagement and align their interests with O’Reilly’s continued growth.
4. Brookfield Corporation (NYSE:BN)
Number of Hedge Fund Holders as of Q4: 37
Akre Capital Management’s Equity Stake: $1.09 Billion
Brookfield Corporation (NYSE:BN), a leading multinational alternative investment management firm, reported record financial results for the year ending December 31, 2024. On February 13, the company announced that its asset management division saw inflows exceeding $135 billion, while its wealth solutions business solidified its status as a premier annuity provider in the U.S. Additionally, the company’s operating businesses maintained stable cash flow generation, contributing to its overall financial strength.
Nick Goodman, President of Brookfield Corporation (NYSE:BN), expressed confidence in the company’s growth trajectory, citing positive momentum across its business segments. He emphasized that Brookfield’s access to large-scale capital remains robust and that the increased transaction activity expected in 2025 will further drive growth in cash flows and intrinsic value. The company’s diversified investment approach, spanning real estate, infrastructure, renewable energy, and private equity, continues to support its long-term financial objectives.
In line with its strong performance, Brookfield Corporation (NYSE:BN) reported a 15% increase in distributable earnings, reaching a record $4.9 billion, or $3.07 per share. This growth underscores the company’s ability to generate consistent returns for its shareholders, even amid fluctuating economic conditions. Brookfield’s disciplined investment strategy and emphasis on high-quality assets have positioned it to capitalize on market opportunities and sustain its impressive earnings trajectory.
Reflecting its commitment to returning value to shareholders, Brookfield’s Board of Directors approved a 13% increase in its quarterly dividend, raising it to $0.09 per share, or $0.36 annually. The dividend is payable on March 31, 2025, to shareholders of record as of March 14. The Board also confirmed regular monthly and quarterly dividends on the company’s preferred shares, reinforcing Brookfield Corporation (NYSE:BN)’s focus on delivering stable and growing returns to its investors.
Baron Real Estate Fund stated the following regarding Brookfield Corporation (NYSE:BN) in its Q4 2024 investor letter:
“Leading real estate-focused asset managers Blackstone Inc. and Brookfield Corporation (NYSE:BN) have an opportunity to increase market share due to impressive investment track records and global scale advantages. They are positioned to benefit from a secular growth opportunity for alternative assets due to long track records of generating attractive relative and absolute returns with what is perceived, in some cases, as less volatility than several other investment options.”
3. Moody’s Corporation (NYSE:MCO)
Number of Hedge Fund Holders as of Q4: 91
Akre Capital Management’s Equity Stake: $1.46 Billion
Moody’s Corporation (NYSE:MCO), a leading financial services firm, reported strong financial results for 2024, driven by substantial growth in both its credit rating and analytics businesses. Total revenue reached $7.09 billion, marking a 20% increase from $5.92 billion in 2023. This impressive performance was fueled by gains across Moody’s Investors Service (MIS) and Moody’s Analytics (MA), which provide essential credit ratings and financial analysis tools. Moody’s ability to capitalize on market demand for data-driven insights and risk assessment solutions has solidified its reputation as a key player in the financial industry.
Moody’s Analytics division generated $3.3 billion in revenue, reflecting an 8% year-over-year increase, with strong contributions from its Decision Solutions, Research and Insights, and Data and Information segments. Meanwhile, Moody’s Investors Service reported an outstanding 33% revenue increase to $3.79 billion, benefiting from broad-based growth across Corporate Finance, Structured Finance, Financial Institutions, and Public, Project, and Infrastructure Finance. This surge highlights the continued reliance on ratings and analytics by Moody’s Corporation (NYSE:MCO) in global financial markets, reinforcing its competitive advantage.
Despite higher operating expenses, which rose by 15% to $1.95 billion, and an increase in selling, general, and administrative expenses to $1.74 billion, Moody’s Corporation (NYSE:MCO) delivered strong profitability. Operating income climbed 35% to $2.88 billion, while net income increased to $2.06 billion from $1.61 billion in the prior year. Diluted earnings per share grew to $11.26, reflecting the company’s ability to manage costs effectively while expanding its revenue base. Although its effective tax rate increased to 23.7% from 16.9% due to prior-year tax benefits, Moody’s maintained a strong financial position, ending the year with $2.41 billion in cash and cash equivalents.
As a global leader in credit ratings and financial intelligence, Moody’s Corporation (NYSE:MCO) continues to benefit from the growing demand for risk assessment tools and analytics, particularly in uncertain economic environments. With a solid track record of revenue and earnings growth, strategic expansion in analytics, and a strong balance sheet, Moody’s remains a top stock to buy for investors seeking long-term value and resilience in the financial sector.
2. KKR & Co. Inc. (NYSE:KKR)
Number of Hedge Fund Holders as of Q4: 83
Akre Capital Management’s Equity Stake: $1.52 Billion
KKR & Co. Inc. (NYSE:KKR), a global investment firm specializing in private equity and asset management, reported a mixed fourth-quarter performance, with assets under management rising 15% to $638 billion, slightly below analyst projections of $643.4 billion. This shortfall contributed to an 8.5% decline in KKR’s stock price right after the earnings call, despite an impressive 78.5% gain throughout 2024. Analysts attribute this drop to concerns over slowing growth and profit-taking following the stock’s substantial rally.
However, KKR & Co. Inc. (NYSE:KKR) remains optimistic about its future, aiming to surpass $1 trillion in assets within the next five years. The company’s capital markets division performed well, generating $270 million in transaction fees for the quarter, driven primarily by private equity and infrastructure investments. For the full year, this division reached a milestone by generating $1 billion in revenue for the first time, underscoring KKR’s ability to navigate a shifting investment landscape.
Financially, KKR & Co. Inc. (NYSE:KKR)’s net income surged 33% to $1.19 billion, or $1.32 per share, surpassing estimates of $1.28 per share. The firm’s infrastructure funds posted a 2% gain, while its opportunistic real estate funds rose 1%, though its private equity portfolio remained flat, reflecting challenges in the broader investment environment. Looking ahead, KKR plans to expand its stakes in USI Insurance Services, 1-800 Contacts, and Heartland Dental, with a combined investment of approximately $1.1 billion. The firm anticipates generating over $350 million in operating earnings from this unit by 2026, with annual projections exceeding $1.1 billion by 2030.
As of the fourth quarter of 2024, Akre Capital Management held over 10 million shares of KKR & Co. Inc. (NYSE:KKR), valued at approximately $1.5 billion, making up 13.15% of Charles Akre’s investment portfolio. Hedge fund interest in KKR also increased, with 83 out of 1,009 funds tracked by Insider Monkey holding positions worth nearly $5.33 billion by the end of the quarter, up from 66 funds in the previous quarter. This growing investor confidence reinforces KKR’s position as one of the top stocks to buy according to Akre Capital Management.
1. Mastercard Incorporated (NYSE:MA)
Number of Hedge Fund Holders as of Q4: 51
Akre Capital Management’s Equity Stake: $1.95 Billion
Mastercard Incorporated (NYSE:MA), a leading multinational payment services corporation, continues to strengthen its position in the global payments industry, providing transaction processing and payment-related solutions to individuals, businesses, and organizations across more than 210 countries and territories. Mastercard remains a top stock to buy, with shares surging 4.9% to $575.90, marking its largest daily percentage gain since November 2022 and reaching a new all-time high. The stock’s rise followed the company’s strong fourth-quarter earnings report, which exceeded analyst expectations.
For the fourth quarter, Mastercard Incorporated (NYSE:MA) reported adjusted earnings of $3.82 per share, surpassing analysts’ estimates of $3.69. Net revenue reached $7.5 billion, also beating projections of $7.39 billion. The company saw robust growth in payment activity, with switched volume, representing the total value of transactions processed, rising 13% from the previous year, an acceleration from the 11% growth in the third quarter. Additionally, cross-border volume climbed 20% on a local currency basis, reflecting increased global spending and travel activity.
Mastercard’s strategic acquisitions and service expansions continue to drive long-term growth. CEO Michael Miebach highlighted the company’s diverse capabilities in payments, services, and solutions, emphasizing the recent acquisition of Recorded Future, a global threat intelligence company. He noted that these enhancements set Mastercard Incorporated (NYSE:MA) apart in the industry and contribute to sustained business momentum. Looking ahead, the company expects revenue to increase by a low double-digit percentage in the first quarter of 2025, with similar full-year revenue growth projections.
Throughout 2024, Mastercard Incorporated (NYSE:MA) demonstrated its commitment to shareholder returns, repurchasing 23 million shares of its common stock for $11 billion and distributing $2.4 billion in dividends. The company ended the year with a total debt outstanding of $18.2 billion, including $4 billion in newly issued debt. With strong financial performance, strategic expansions, and continued innovation in payment solutions, Mastercard remains well-positioned for future growth, making it an attractive investment option.
Overall, Mastercard Incorporated (NYSE:MA) ranks first on our list of top 10 stocks to buy according to Akre Capital Management. While we acknowledge the potential for MA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than MA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks to Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
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