Recently, personal finance website WalletHub examined the most recent SEC disclosures filed by more than 400 hedge funds and billionaires. Among its findings was that out of the thousands of stocks in the market, only a handful appear near the top of more than one of their portfolios. Below, let's consider the three top stocks that five billionaires bought, and made some of their biggest holdings.
Big bites of the Apple
Despite perennial concerns about how long the popularity of the various products in its ecosystem will endure, Apple (NASDAQ:AAPL) was still able to attract the favor of Warren Buffett. Berkshire Hathaway (NYSE:BRK-A)(NYSE:BRK-B) has been buying up shares of the tech giant for some time now. And so has David Tepper of Appaloosa Management: Apple stock was the biggest purchase of both billionaires in the fourth quarter, and it's now Berkshire Hathaway's single largest holding.
Long gone are the days when Buffett avoided tech stocks because, as he said, he didn't understand them. He now holds 165 million shares of Apple worth about $28 billion, meaning the tech giant now represents almost 15% of Berkshire's $191 billion in total assets.
Tepper's fund, with $10.7 billion under management, might not be as large as Buffett's, but Apple also comprises a sizable 7% of Appaloosa's portfolio.
Securing their social standing
Tepper makes his second appearance on this list by also owning a sizable portion of Facebook (NASDAQ:FB) stock. At 9% of his portfolio, it's his second largest holding just behind Micron Technology, which comprises 10.5% of the total. Similarly, Julian Robertson over at Tiger Management has a significant portion of his $28.5 billion in assets under management tied up in the leading social media platform -- 4% of the portfolio's total.
They may have been buying up Facebook stock as the site continued to post blowout earnings, but this month, its share price slumped in the wake of accusations that Russian agents used bots on the platform to run a disinformation campaign intended to influence the 2016 presidential election.
And now, eMarketer suggests Facebook could lose 2 million users under the age of 25 this year as young people's social media preferences shift elsewhere. Shares are down slightly for the month. If they fall further, we may see these two billionaire hedge fund operators scoop up even more Facebook stock.
More than a bite-sized snack
Nelson Peltz may be stepping down from the board of directors of Mondelez International (NASDAQ:MDLZ), but he still holds a sizable stake. Shares of the global snack foods giant account for 15.4% of the $12.5 billion his Trian Funds has in assets under management.
He began acquiring shares of the company as an activist investor after the company's split from Kraft Foods. He had been pushing for PepsiCo (NASDAQ: PEP) to either spin off its beverage unit and merge its Frito-Lay snacks business with Mondelez or just separate those two divisions. Pepsi chose to ignore his recommendations though, and Peltz finally gave up his efforts on that front after being appointed to Mondelez' board.
Pershing Square Capital Management's Bill Ackman might not have had as colorful a relationship with Mondelez as Peltz, but since 2015, he's acquired substantial tranches of its stock, and in the fourth quarter, the snack maker was his biggest purchase. He now owns 23.3 million shares of Mondelez International, valued at just under $1 billion, or 16.9% of his $5.8 billion fund.
Blindly following any investor, billionaire or otherwise, is never a sound investment strategy, but these hedge fund operators have reached the pinnacle of their industry by being shrewd and astute. Keeping tabs on where they're placing their money -- particularly if several of them are piling heavily into the same stocks -- is well worth doing.
Rich Duprey has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Apple, Berkshire Hathaway (B shares), and Facebook. The Motley Fool has the following options: long January 2020 $150 calls on Apple, short January 2020 $155 calls on Apple, short March 2018 $200 calls on Facebook, and long March 2018 $170 puts on Facebook. The Motley Fool has a disclosure policy.