Viking Global’s 5 Long-Term Stock Picks

In this article, we discuss Viking Global’s 5 long-term stock picks. To read the detailed analysis, performance history, and investment philosophy of Andreas Halvorsen’s Viking Global, go directly to Viking Global’s Performance, AUM, and Long-Term Stock Picks.

5. Microsoft Corporation (NASDAQ:MSFT)

Stock Held by Viking Global Since: Q2 2016

Percentage of Viking Global’s portfolio as of Q1 2023: 1.41%

In the first quarter of 2023, Microsoft Corporation (NASDAQ:MSFT) was held by 289 hedge funds, making it the most owned stock by hedge funds according to our database. Bill & Melinda Gates Foundation Trust was the most prominent hedge fund holder of the company with over 39.26 million shares worth $11.32 billion. In the same quarter, Viking Global owned over 1.047 million Microsoft Corporation (NASDAQ:MSFT) shares worth $301.95 million. The hedge fund has held the company stock since the second quarter of 2016.

One of the Big Four accounting firms, KPMG International Limited, is planning to invest at least $2 billion in Microsoft Corporation (NASDAQ:MSFT)’s AI and cloud services businesses over the next five years. The accounting firm sees a potential $12 billion growth in the company’s AI and cloud segment.

In February 2022, Microsoft Corporation (NASDAQ:MSFT) announced the acquisition of Activision Blizzard, Inc. (NASDAQ:ATVI) for $95 per share, and the deal was later blocked by the US Federal Trade Commission (FTC) over monopolization concerns. However, on July 12, the federal judge looking over the case denied FTC’s injunction over the case and said that the agency’s arguments lacked merit. The deal between Microsoft Corporation (NASDAQ:MSFT) and Activision Blizzard, Inc. (NASDAQ:ATVI) has a termination date of July 18, 2023.

ClearBridge Investments made the following comment about Microsoft Corporation (NASDAQ:MSFT) in its second quarter 2023 investor letter:

“2023 has so far marked a return to mega cap leadership, with Apple, Microsoft Corporation (NASDAQ:MSFT), Alphabet, Amazon.com and Nvidia accounting for approximately two thirds of the benchmark return. At 41.3%, the five largest stocks in the market represent the highest concentration in the 26-year history of the Russell 1000 Growth Index. Among these names, we maintain overweights to Nvidia (+246 bps) and Amazon (+117 bps), underweights to Microsoft (-353 bps) and Apple.

The Strategy’s IT holdings also drove performance in the second quarter, led by the continued rerating of graphics chipmaker Nvidia as a key beneficiary of the generative AI boom. AI-connected holdings Microsoft and Amazon also delivered strong gains.”

4. Fortive Corporation (NYSE:FTV)

Stock Held by Viking Global Since: Q3 2019

Percentage of Viking Global’s Portfolio as of Q1 2023: 2.03%

Fortive Corporation (NYSE:FTV) is a Fortune 500 company that manufactures and markets products in the industrial technology sector. Danaher Corporation (NYSE:DHR)’s Test and Measurement segment was spun off to form the company in July 2016.

On July 10, Wells Fargo analyst Joseph O’Dea maintained an Equal-Weight rating on Fortive Corporation (NYSE:FTV)’s stock and raised the price target to $71 from $67. The analyst highlighted the possibility of upside risk to the EPS of the second quarter and “modest guidance revision”. Viking Global has held Fortive Corporation (NYSE:FTV)’s stock since the third quarter of 2019. 

Here is what Cooper Investors said about Fortive Corporation (NYSE:FTV) in its fourth-quarter 2022 investor letter:

“Fortive Corporation (NYSE:FTV) completed several acquisitions and had probably its best year operationally since the 2016 spin-off from Danaher, reporting several quarters in a row of double-digit organic growth and margin expansion that beat market estimates. The business has now unlocked the potential we always saw in it, with software almost a quarter of revenues today, providing a nice element of recurring cash flow to support the more cyclical industrial parts of the group.”

3. BridgeBio Pharma, Inc. (NASDAQ:BBIO)

Stock Held by Viking Global Since: Q2 2019

Percentage of Viking Global’s Portfolio as of Q1 2023: 2.07%

BridgeBio Pharma, Inc. (NASDAQ:BBIO) is a California-based biotechnology company specializing in medicines related to genetic diseases and cancers. The company is partnering with the UAE-based healthcare company, Burjeel Holdings, for project NADER (Needs Assessment and Therapeutics Development for Rare Diseases). The project aims to revolutionize early diagnosis and treatment of rare diseases in the MENA region.

Over the last 3 months, seven Wall Street analysts covered BridgeBio Pharma, Inc. (NASDAQ:BBIO) stock and all of them maintain a Buy or Overweight rating with an average price target of $29.50. On July 12, BridgeBio Pharma, Inc. (NASDAQ:BBIO) closed at $18.05.

Viking Global has held BridgeBio Pharma, Inc. (NASDAQ:BBIO) stock since the second quarter of 2019. In Q1 2023, the company represented 2.07% of the investment portfolio with 26.62 million shares worth $441.376 million. Viking Global was also the largest hedge fund holder of BridgeBio Pharma, Inc. (NASDAQ:BBIO) in the quarter.

2. Amazon.com, Inc. (NASDAQ:AMZN)

Stock Held by Viking Global Since: Q2 2015

Percentage of Viking Global’s Portfolio as of Q1 2023: 3.69%

Amazon.com, Inc. (NASDAQ:AMZN) is one of the biggest tech companies in the world with a foothold in cloud computing, e-commerce, online streaming, AI, and digital marketing.

On July 13, Amazon.com, Inc. (NASDAQ:AMZN) revealed that Prime Day’s first day saw the most sales in the company’s past. The figures reported by the company show that Prime members made use of deals to have savings above $2.5 billion and bought 375 million items on the website across the world.

Amazon.com, Inc. (NASDAQ:AMZN) has been a part of Ole Andreas Halvorsen’s investment portfolio since the second quarter of 2015. In Q1 2023, the company represented 3.69% of Viking Global’s portfolio with over 7.6 million shares worth $787.92 million.

White Falcon Capital Management made the following comment about Amazon.com, Inc. (NASDAQ:AMZN) in its second quarter 2023 investor letter:

“Amazon.com, Inc. (NASDAQ:AMZN): Amazon is a controversial investment. It had been ‘profitless’ for much of its existence and divided investors on the ultimate sustainability of the business model. We believe that Amazon has two very strong businesses – an e-commerce business (including ads) backed by a top-notch logistics network and an internet infrastructure business called AWS that is an oligopoly with Microsoft and Google. We believe Amazon has a superior culture that allows it to succeed in its various business lines. Importantly, Amazon is inflecting on free cash flow (FCF). We model that it will produce $6+ in FCF per share in three years. If this is valued at 3-3.5% FCF yield then Amazon is a $200 stock. Amazon also has a portfolio of venture bets (which consume a lot of capital) and all these are upside options for an investor.”

1. Visa Inc. (NYSE:V)

Stock Held by Viking Global Since: Q3 2016

Percentage of Viking Global’s Portfolio as of Q1 2023: 6.94%

Visa Inc. (NYSE:V) has been a part of Viking Global’s portfolio since the third quarter of 2016. On June 28, the corporation announced it will acquire Brazillian payments company, Pismo, for $1 billion which will enhance its core banking and issuer processing services to its financial technology clients.

In the first quarter of 2023, London-based hedge fund TCI Fund Management held the most shares in Visa Inc. (NYSE:V) with 19.29 million shares worth $4.35 billion. In the same quarter, Viking Global was the company’s third-leading stakeholder as it upped its stake in the company by 14% to 6.56 million shares worth $1.48 billion.

On July 7, analysts at MoffettNathanson reiterated an Outperform rating on Visa Inc. (NYSE:V)’s shares and raised the price target to $320 from $290, noting that the company has been delivering strong financial results for the last 9 quarters and has no new risks in the near future.

Manole Capital Management mentioned Visa Inc. (NYSE:V) in its second-quarter 2023 investor letter. Here is what it said:

“We like to start out all of our discussions by telling investors who we are. We are FINTECH investors, and we define Fintech as “anything utilizing technology to improve an established process.” We realize that half of Fintech is financial, but we don’t invest in traditional, credit sensitive banks. Having managed money during the Financial Crisis, we learned firsthand how certain opaque and balance sheet intensive financials could go bankrupt or insolvent.

We prefer transaction-based businesses, generating recurring revenue, with sustainable margins, and significant cash flow. From our perspective, the perfect example of a FINTECH business is the secularly growing payments industry. Names like Visa Inc. (NYSE:V) or Mastercard, that generate revenue and profit per swipe or transaction, without the underlying credit sensitivity or risk associated with that underlying line of credit.”

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