Stocks that George Soros Keeps Buying
Soros focuses on supporting liberal ideals and causes and developed a philosophy of reflexivity based on the ideas of Karl Popper. Reflexivity, as used by Soros, is the belief that the action of beholding the valuation of any market, by its participants, affects said valuation of the market in a "virtuous or vicious" circle. Soros began to apply his ideas on reflexivity to investing, using it to predict, among other things, the emergence of financial bubbles. His philosophies as he put them in his books have included, "My approach works not by making valid predictions but by allowing me to correct false ones… The secret to my success is that I know that I will be wrong. I consider it a strength to admit my mistakes. That allows me to stay in the game and fight another day."
In 1967, Soros helped establish an offshore investment fund. In 1973, he set up a private investment firm that eventually evolved into the Quantum Fund, one of the first hedge funds. He is a strong supporter of the Democratic Party and has funded many politicians including Barack Obama and John Kerry and media outlets over the years.
One of Soros’ long-time goals has been to subvert the national anti-drug policy of the U.S. Government, to move away from the use of national and global law enforcement resources against the drug trade, he calls this “harm reduction.” In 2010, he donated $1 million in support of Proposition 19, which would have legalized marijuana in the state of California. Soros has also been reportedly purchased a major stake in one of Colombia’s biggest banks, at a time when the Drug Enforcement Administration, in its study, “Colombian Economic Reform: The Impact on Drug Money Laundering within the Colombian Economy,” was documenting how major drug kingpins were taking advantage of the liberalization of the economy to put illicit drug revenue into legitimate businesses. The report stated: “U.S. and Colombian Government authorities have evidence of drug proceeds being deposited in every major bank in Colombia… A Colombian source indicated that many banks and businesses are owned covertly by principal members of the Cali cartel.”
In late 2009, Soros assembled 25 economists, financiers, and journalists in Bedford, New York to brainstorm the idea. This Summit resulted in a “unanimous agreement that our economic paradigm must change,” and a “recognition of the importance of empowering the young generation of economists to rethink” the field of economics. In the end, the Institute for New Economic Thinking (INET) was created as a nonprofit foundation in October 2009; its initial funding came from a $50 million pledge by Soros's Open Society Institute.
Recently, Soros called gold "the ultimate bubble", has sold almost his entire holding of the precious metal, leading to fears that the price is about to fall. In exchange, he has now bought shares in two mining companies, Freeport-McMoRan Copper & Gold and Goldcorp.
Here are some stocks that George Soros have been trading for many years:
No. 1: Dendreon Corp. (DNDN), Weightings: 2.08% - 4,671,699 Shares
Dendreon Corporation discovers and develops immunologically based therapeutic products for the treatment of cancer. Dendreon Corp. has a market cap of $5.8 billion; its shares were traded at around $40.87 with and P/S ratio of 120.7. Dendreon Corp. had an annual average earnings growth of 2.9% over the past 10 years. As the first FDA-approved immunotherapy, Dendreon's Provenge significantly reduced the barriers to entry for firms seeking regulatory approval of immune-based therapies. The first mover advantage also scored Dendreon a lofty $6.12B valuation. Provenge, their prostate cancer drug, is generating good revenue numbers and DNDN is seeking FDA approval to expand the manufacturing capacity to a new facility in California. Dendreon is expecting to hear the FDA’s decision by late June 2011. Another manufacturing facility is also under construction in Georgia and we should hear from the FDA on their approval sometime in the late summer to early fall. If DNDN can get all these new plants up and online, the revenue they will generate should move the stock price to new heights.
George Soros owns 4,671,699 shares of DNDN, valued as $175 million as of Mar. 31, 2011, which accounts for 2.08% of his equity portfolio. George Soros added his positions in the Dec. 31, 2010 quarter by 131.15%, again in the Mar. 31, 2011 quarter by 11.27%. Soros bought and sold out 12,000 shares of this stock in early 2010 when the shares grew about $10 per share, then in end of 2010 started to buy massive amounts of shares to over 4 million and remained at about that amount at least a quarter, so he looks like he has limited his holdings on this stock recently. From 2 consecutive quarters of buying of about 2 million shares to buying only 500,000 shares in the most recent quarter, Soros will probably make more bold decisions to buy as more plans about new plants are reveled.
No. 2: Citigroup Inc. (C), Weightings: 1.55% - 29,385,033 Shares
Citigroup Inc., the global financial services company, has some two hundred million customer accounts and does business in more than hundred countries, providing consumers, corporations, governments, and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, and wealth management. Citigroup Inc. has a market cap of $118.64 billion; its shares were traded at around $40.33 with a P/E ratio of 13.1 and P/S ratio of 1.4. The main prediction about banks currently is on the assumption that historically the government would step in to support them during a crisis. This week, it was announced that plans to shut down a company-run hedge fund trading assets with a total net worth of close to $400 million, announced by that the fund’s manager, Shakil Ahmed, who will be promoted to Head of Electronic Market-Making for Citi’s New-York operations. The move by Citi is thought to have been spurred by regulators’ announcement that they will implement the ‘Volcker Rule,’ “which bars lenders such as Citigroup from making bets with their own capital, known as proprietary trading” have begun reinstating their dividend payments. Citi will also increasing their dividend payouts in the financial sector.
George Soros owns 29,385,033 shares of C, valued as $130 million as of Mar. 31, 2011, which accounts for 1.55% of his equity portfolio. George Soros added his positions in the Dec. 31, 2010 quarter by 1905.01%, again in the Mar. 31, 2011 quarter by 174.2%. This stock has been one of Soros’s more active and risky exchanges over the years as he has sold out multiple times with massive share holdings. The current holdings of 30 million shares were a result of buying 10 millions shares a quarter then another 20 million the next quarter, but compared to owning 95 million shares at nearly the same price in late 2009 and early 2010 and then sold out all his holdings. It seems, after his sell out and the stock price started low again, Soros has bought this stock once again because of his confidence for it to go up again. So far Soros have been proven right as the share prices have been going up at about $4 per quarter for 3 consecutive quarters now, so he will likely increase his position.
No. 3: Westport Innovations Inc (WPRT), Weightings: 1.45% - 5,547,604 Shares
Westport Innovations Inc. is a global supplier of proprietary solutions that allow engines to operate on clean-burning fuels such as compressed natural gas, liquefied natural gas, hydrogen, and biofuels such as landfill gas. Westport Innovations Inc has a market cap of $1.17 billion; its shares were traded at around $25.35 with and P/S ratio of 9.6. Westport and Caterpillar are in a partnership seeking to demonstrate that the integration of their respective direct injection, natural gas technologies can deliver the high performance and high efficiency requirements large engine applications will demand. Under the terms of the agreement, the evaluation is expected to be completed in 2012. NAT GAS Act is up for consideration as of May 4 and would give a tax credit for up to 80 percent of the purchase cost of a natural gas vehicle, with a cap dependent on the car’s weight — $8,000 for passenger cars and up to $64,000 for heavy trucks. It would also give the same credit for 50 percent of the above caps for dual-fuel cars, and other tax credits for building natural gas refueling stations. And WPRT provides the fuel systems for the natural gas engines in trucks. Soros has also just sold most of his holdings in gold and replacing with investments in mining companies. More information will be revieled soon at Westport Announces Fourth Quarter and Year End Fiscal 2011 Conference Call on Wednesday, June 8, 2011.
George Soros owns 5,547,604 shares of WPRT, valued as $122 million as of Mar. 31, 2011, which accounts for 1.45% of his equity portfolio. George Soros added his positions in the Dec. 31, 2010 quarter by 38.98%, again in the Mar. 31, 2011 quarter by 22.56%. Soros bought a massive 1.8 million shares at the early of 2010, and he has been buying ever since. The stock price only increased by $4 in 1 quarter and stayed the same for a year, and his holdings has steadily and interestingly increased by 1 million every quarter, this is a stock that should be looked more closely and for understanding why he has so much confidence in this stock. No other guru but one currently has any shares of this stock and that guru only owns 280,000 shares not 5.5 million.
No. 4: Wells Fargo & Co. (WFC), Weightings: 1.32% - 3,505,100 Shares
Wells Fargo & Company is a diversified financial services company providing banking, insurance, investments, mortgage and consumer finance services through stores, its Internet site and other distribution channels across North America as well as internationally. Wells Fargo & Co. has a market cap of $145.14 billion; its shares were traded at around $27.56 with a P/E ratio of 11.3 and P/S ratio of 1.6. The dividend yield of Wells Fargo & Co. stocks is 1.7%. Wells Fargo & Co. had an annual average earnings growth of 5.4% over the past 10 years. The situation is very similar to Citigroup Inc. (C) in that they both follow the Bank of America, and right now is the cheap time to buy banks.
George Soros owns 3,505,100 shares of WFC, valued as $111 million as of Mar. 31, 2011, which accounts for 1.32% of his equity portfolio. George Soros added his positions in the Dec. 31, 2010 quarter by 1169.64%, again in the Mar. 31, 2011 quarter by 516.23%. This is a stock that Soros has been exchanging relatively vigorously ever since mid-2007, but he lost money in the transitions before 2009 though he never had more than 30,000 shares. In late 2010 then suddenly in 2011 he increased his holding 10 fold then another 7 fold. This action might be a late reaction in that the stock value has been steadily growing since late 2009 but did not have the confidence to buy any more shares. The confidence to invest heavily now seems to be the reaction of the unique growth in stock price of about $5 in the most recent quarter.
No. 5: CVS Caremark Corp. (CVS), Weightings: 1.2% - 2,926,676 Shares
CVS/Caremark is the nation's premier integrated pharmacy services provider, combining one of the nation's pharmaceutical services companies with the country's largest pharmacy chain. Cvs Caremark Corp. has a market cap of $51.86 billion; its shares were traded at around $38.17 with a P/E ratio of 14.2 and P/S ratio of 0.5. The dividend yield of Cvs Caremark Corp. stocks is 1.3%. Cvs Caremark Corp. had an annual average earnings growth of 13.4% over the past 10 years. GuruFocus rated Cvs Caremark Corp. the business predictability rank of 4.5-star. CVS won a $3 billion government contract from Medco, its rival, to provide pharmacy benefits. Also, Medco Health Solutions said it will lose a lucrative contract next year with Blue Cross Blue Shield Association while, CVS Caremark gained a three-year agreement to serve its federal employee program.
George Soros owns 2,926,676 shares of CVS, valued as $100 million as of Mar. 31, 2011, which accounts for 1.2% of his equity portfolio. George Soros added his positions in the Dec. 31, 2010 quarter by 417.66%, again in the Mar. 31, 2011 quarter by 918.68%. Soros made a huge profit in 2006 and 2007 but with huge uncertainty as he bought 2 million shares from the start and sold half as the price went up every quarter which resulted in having sold basically all his shares before the stock prices stopped continuously increasing by about $4 per quarter for a year. Then in 2009 he began buying again and adjusting the number of shares very closely to the price. Soros seems to like to hold this stock for the long term but any signs of bearish behavior may result in massive sells.
No. 6: Danaher Corp. (DHR), Weightings: 1.16% - 1,871,770 Shares
Danaher Corporation conducts its operations through two business segments: Process/Environmental Controls and Tools and Components. Danaher Corp. has a market cap of $35.24 billion; its shares were traded at around $53.91 with a P/E ratio of 21.8 and P/S ratio of 2.7. The dividend yield of Danaher Corp. stocks is 0.2%. Danaher Corp. had an annual average earnings growth of 13.8% over the past 10 years. GuruFocus rated Danaher Corp. the business predictability rank of 3.5-star. Danaher is a very well run "roll-up" company which has made a fortune acquiring businesses, cutting costs and redundancies by laying off workers, and by streamlining the business models of its portfolio companies. Danaher has proven that strong cash flows and an LBO model works well in an environment of extremely low interest rates. SciQuest signed a big contract late last year with Danaher, and SciQuest’s success will effect Danaher positively as it continues to grow. SciQuest’s shares were $9.50 last September and closed at $15.30 June 1. The company's second IPO, raised a net $20 million for the company. A secondary offering in March brought in $15 million more.
George Soros owns 1,871,770 shares of DHR, valued as $97 million as of Mar. 31, 2011, which accounts for 1.16% of his equity portfolio. George Soros added his positions in the Dec. 31, 2010 quarter by 4943.94%, again in the Mar. 31, 2011 quarter by 462.26%. Soros has bought and sold his 3,000 shares of this stock before with some profit in late 2007. Now with high consistent price growth for a year, Soros rebought shares and has increased from 3,200 to almost 2 million shares in a year while the price has went up more than $12. Soros is investing exponentially more every quarter assuming the stock will keep on growing.
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