3 Investors Share the Largest Holdings in Their Stock Portfolios

If your portfolio has been on a downward spiral lately, you're definitely not alone. With so many stocks, particularly high-growth stocks, taking a severe beating lately, you might be wondering what the portfolios of some of your fellow long-term investors are like right now. In this segment of Backstage Pass, recorded on Jan. 12, Fool contributors Rachel Warren, Trevor Jennewine, and Jamie Louko dive into some of the largest holdings in their portfolio and how they're approaching investing right now. 

Rachel Warren: I'm sure I'm not the only one that's been seeing my portfolio dip lately. We've been getting a lot of questions from members who've been having similar experiences, particularly as the market has beaten down a lot of high-growth companies in recent months, a lot of really great stocks, like Teladoc.

But I saw this question posted on a Twitter page that I check now and then, and I thought it was a fun one to discuss.

I'm curious, what is the largest holding or holdings in your portfolio right now, and what is your investment thesis around that company? Trevor, take this one first.

Trevor Jennewine: My largest holding, it depends on the day, but right now it is Shopify (SHOP 3.42%). I want to say it's 8% of my portfolio or so. This builds on what Jamie was saying about e-commerce earlier. I think there's a lot of room left for growth in e-commerce.

Shopify has established itself as the retail operating system for 1.7 million businesses around the world. In terms of e-commerce software platforms, it is the most popular e-commerce software platform. I like the company's growth strategy.

They're building out their fulfillment network across the United States. I think that will only reinforce their competitive advantage that they've built. Over the last year, free cash flow was up 150%, revenue is up 71%. They're a big company, but they are still growing very fast, and I think they got a lot of tailwinds behind them.

I like the management team. I don't have any plans to make my position any smaller. I don't have any plans to add to it. I would if it wasn't already such a large position in my portfolio. But once something gets about 5 percent, I tend to not add to it. I just let it run.

Warren: Very good. What about you, Jamie?

Jamie Louko: My largest holding is Domino's Pizza (DPZ 0.32%). This is for a few reasons. One primary reason is basically because I have a lot of risky, fast-growing tech, so I counteract that with some really, really stable companies like Domino's. But I have three major reasons. The first being it outgrows almost all other pizza companies in nearly every quarter and especially over the long term.

For example, over the past decade, Domino's has grown its quarterly revenue 160%, and that compares to Papa John's 55% over a decade. Nearly tripling it's other major competitor. 

No. 2, it is a money-generating machine. For the first nine months of 2021, it had a 12% net income margin and a 14% of free cash flow margin, and it uses almost all of that to either pay dividend or buy back stock, which I'm a fan of especially when it's my largest holding.

The third reason, it's an under-the-radar tech company. Domino's Pizza, tech? Yes, it really is a tech company. We're going to look at the Nuro partnership, which is basically a self-driving robot that it has partnered with to develop in Houston, Texas, to deliver pizzas without a driver. It's just a little robot, [laughs] drives around. It's so cool.

But also on a little more realistic note, 75% of its orders come through digital services, whether it's through their app or website or what have you, and 50% of its transactions are delivery. Domino's Pizza does all of their delivery in-house. They don't outsource it to anyone. They have developed all of this software and everything in-house because they are really good at tech, because they're an underrated tech company. Three reasons real quick, that's why.

Warren: Wow, that's awesome. Thank you for sharing. I also just think it's so cool that Domino's is having this interesting AI side [laughs] to its business.

I don't know, that's just fascinating. I just love the idea of getting a pizza that doesn't actually have a delivery man involved. I guess that's the long-term goal.

Louko: Just a little three-by-three box just showing up in front of your house with a couple of medium pizzas. It's pretty nice.

Warren: C-3PO shows up with my pizza, yeah, [laughs] I would love that.

It's funny. I've talked a lot before how I'm a newer investor. When I bought my first stocks, I invested in 10 companies, all of which I still hold. I allocated my cash equally to those companies. But then over time, share prices change, things shift around a bit. I actually had to look this up because I wasn't sure where things had settled out.

About 40% of my portfolio is healthcare companies, and about 36% of my portfolio is tech, and then the remaining areas, a little bit of consumer goods, a little bit of e-commerce. But my top holding in my healthcare side of my portfolio is actually Johnson & Johnson (JNJ -0.43%).

A classic value stock with a robust dividend that it has consistently increased, I think every year for nearly 60 years now. The company is going to be splitting in the next couple of years.

But even so, that will still result in two publicly traded dividend-paying companies whose dividends should add up to about what the current one is.

I love that stock, not a super high-growth one, but the dividend and just the resilience of its business and the constant demand that it faces, those are all reasons why I continue to stay invested in that company.