In this article, we discuss the top 5 stock picks of Terry Smith’s Fundsmith LLP. If you want to skip our detailed analysis of Smith’s history, investment philosophy, and hedge fund performance, go directly to Top 10 Stock Picks of Terry Smith’s Fundsmith LLP.
5. Facebook, Inc. (NASDAQ:FB)
Fundsmith LLP Stake Value: $2.24 billion
Percentage of Fundsmith LLP’s 13F Portfolio: 6.2%
No. of Hedge Fund Holders: 266
Facebook, Inc. (NASDAQ:FB), headquartered in Menlo Park, California, is a social networking firm. It allows people to interact and share via mobile devices and personal computers. Facebook, Instagram, Messenger, WhatsApp, and Facebook Reality Labs are the company’s key products. The company is fifth on our list of top 10 stock picks of Terry Smith’s Fundsmith LLP.
Out of the hedge funds being tracked by Insider Monkey, Crake Asset Management is one of the biggest stakeholders in Facebook, Inc. (NASDAQ:FB) with 485,052 shares worth $168.7 billion.
First Eagle Investment Management, an investment management firm, published its Q2 2021 investor letter and mentioned Facebook, Inc. (NASDAQ:FB). Here is what First Eagle Investment Management has to say about the company:
“Leading contributors in the First Eagle Global Fund this quarter included Facebook, Inc. Class A. Facebook has continued to post impressive results for both revenue and active users of its traditional platforms. In the meantime, the social media giant continues to make progress on new initiatives—like Facebook Horizon (virtual reality) and Facebook Shops (e-commerce)—and maintains attractive monetization optionality around services like Messenger and WhatsApp.”
4. Intuit Inc. (NASDAQ:INTU)
Fundsmith LLP Stake Value: $2.25 billion
Percentage of Fundsmith LLP’s 13F Portfolio: 6.22%
No. of Hedge Fund Holders: 66
Ranked fourth on our list of top 10 stock picks of Terry Smith’s Fundsmith LLP is Intuit Inc. (NASDAQ:INTU). The company, headquartered in Mountain View, California, creates and sells financial management software solutions. It has a market cap of $142.7 billion. Our data shows that Fundsmith LLP is one of the biggest stakeholders in Intuit Inc. (NASDAQ: INTU) with 4.6 million shares worth $2 billion.
Smith’s Fundsmith LLP increased stake in Intuit Inc. (NASDAQ:INTU) by 1% during the second quarter of 2021 compared to the first quarter. At the end of the second quarter of 2021, 66 hedge funds in the database of Insider Monkey held stakes worth $5 billion in Intuit Inc. (NASDAQ:INTU), down from 68 the preceding quarter worth $4.7 billion.
In the fourth fiscal quarter, Intuit Inc. (NASDAQ:INTU) reported an EPS of $1.87, beating estimates by $0.38. The company’s revenue in the fourth fiscal quarter came in at $2.56 billion, an increase 40.7% year over year, and beat revenue estimates by $240 million.
Qualivian Investment Partners, an investment management firm, published its Q2 2021 investor letter and mentioned Intuit Inc. (NASDAQ:INTU). Here is what Qualivian Investment Partners has to say about the company:
“The Thesis in a Nutshell
Intuit is an attractive combination of:
• attractive economics,
• a wide moat, especially via the development of a connected ecosystem/digital platform that locks stakeholders in, and
• strong growth in core markets supplemented by geographic global expansion, as well as,
• a shareholder-oriented management team.It is a quality compounder. At the right price it is a clear buy.
What Intuit Does
Intuit dominates the small and medium business (SMB) accounting software category as well as the doit-yourself (DIY) tax preparation software market. Intuit has three key businesses:
• Software for financial and business management (QuickBooks) as well as integrated payroll solutions, merchant payment processing solutions, and financing for small businesses in the US and key global markets;
• Do‑it‑yourself and assisted income tax preparation software products (TurboTax) and services sold in the US and Canada; and
• FinTech Apps (Mint and now Credit Karma) that provide users the ability to integrate and monitor their financial lives in one platform, while allowing them to shop for financial service products (credit cards, mortgages, auto loans, and insurance products)…” (Click here to see the full text)
3. IDEXX Laboratories, Inc. (NASDAQ:IDXX)
Fundsmith LLP Stake Value: $2.7 billion
Percentage of Fundsmith LLP’s 13F Portfolio: 7.42%
No. of Hedge Fund Holders: 39
IDEXX Laboratories, Inc. (NASDAQ:IDXX), headquartered in Westbrook, Maine, makes and sells products for veterinary, livestock and poultry, water testing and diary industries. The company, with a market cap of $51.9 billion, is third on our list of top 10 stock picks of Terry Smith’s Fundsmith LLP.
ClearBridge Investments, an investment management firm, published its Q2 2021 investor letter and mentioned IDEXX Laboratories, Inc. (NASDAQ: IDXX). Here is what ClearBridge Investments has to say about the company:
“The Strategy also received strong contributions from several companies in the health care sector. IDEXX Laboratories, meanwhile, benefited from strong performance in its veterinary products segment as pet ownership continues to increase.”
2. Microsoft Corporation (NASDAQ:MSFT)
Fundsmith LLP Stake Value: $3.3 billion
Percentage of Fundsmith LLP’s 13F Portfolio: 9.03%
No. of Hedge Fund Holders: 238
Microsoft Corporation (NASDAQ:MSFT), headquartered in Redmond, Washington, is a prominent developer of software systems and applications for personal computers. The company is second on our list of top 10 stock picks of Terry Smith’s Fundsmith LLP.
Baron Opportunity Fund, an investment management firm, published its Q2 2021 investor letter and mentioned Microsoft Corporation (NASDAQ: MSFT). Here is what Baron Opportunity Fund has to say about the company:
“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. PayPal Holdings, Inc. (NASDAQ:PYPL)
Fundsmith LLP Stake Value: $3.6 billion
Percentage of Fundsmith LLP’s 13F Portfolio: 9.92%
No. of Hedge Fund Holders: 143
Ranked first on the list of top 10 stock picks of Terry Smith’s Fundsmith LLP is PayPal Holdings, Inc. (NASDAQ: PYPL). The company, headquartered in San Jose, California, is a digital payments and technology platform firm that enables users to make digital and mobile payments.The company has a market cap of $297 billion. In the second quarter of 2021, PayPal Holdings, Inc. (NASDAQ:PYPL) reported an EPS of $1.15, beating estimates by $0.03. The company’s revenue in the second quarter came in at $6.24 billion, an increase of 18.6% year over year, and missed revenue estimates by $30 million.
On July 29, investment advisory Morgan Stanley kept an Overweight rating on PayPal Holdings, Inc. (NASDAQ: PYPL) stock and increased its price target $340 from $337, appreciating positive future growth of the company.
Smith’s Fundsmith LLP decreased stake in PayPal Holdings, Inc. (NASDAQ:PYPL) by 1% during the second quarter of 2021 compared to the first quarter. At the end of the second quarter of 2021, 143 hedge funds in the database of Insider Monkey held stakes worth $16 billion in PayPal Holdings, Inc. (NASDAQ:PYPL), same as the preceding quarter worth $14 billion.
Harding Loevner, an investment management firm, published its Q2 2021 investor letter and mentioned PayPal Holdings, Inc. (NASDAQ: PYPL). Here is what Harding Loevner has to say about the company:
“Digital payments provider PayPal announced strong first-quarter results (with transactions up by over a third) and more product enhancements for its suite of products (including Venmo, Honey, and Braintree) as it continues to deepen its transformation from a digital wallet into a “super-app.”
You can also take a peek at the 10 Penny Stocks Redditors are Buying in August and 10 Best Small-Cap Stocks to Buy According to Hedge Funds.
