The Bill & Melinda Gates Foundation Trust, founded in 2000 by Bill Gates (Trades, Portfolio) and his ex-wife Melinda, released its regulatory third-quarter 13F filing, revealing that it expanded its holdings of Microsoft Corp. (MSFT, Financial), Canadian National Railway Co. (CNI, Financial), Waste Management Inc. (WM, Financial) and Deere & Co. (DE, Financial). The trust also established new positions in Waste Connections Inc. (WCN, Financial) and The Kraft Heinz Inc. (KHC).
While the foundation trust is managed by outside investors, Gates guides the managers in voting proxies consistent with the principles of good governance and good management. The trust also considers other issues beyond corporate profits, including defining areas in which the trust will not invest in.
As of September, the foundation trust’s $33.99 billion 13F equity portfolio contains 21 stocks with two new positions and a quarterly turnover ratio of 53%. The top three sectors in terms of weight are industrials, technology and financial services, representing 43.30%, 26.91% and 23.32% of the equity portfolio.
Investors should be aware 13F filings do not give a complete picture of a firm’s holdings as the reports only include its positions in U.S. stocks and American depository receipts, but they can still provide valuable information. Further, the reports only reflect trades and holdings as of the most-recent portfolio filing date, which may or may not be held by the reporting firm today or even when this article was published.
Microsoft
The trust purchased 38,320,050 shares of Microsoft (MSFT, Financial), giving the stake 26.26% equity portfolio weight. The transaction vaulted Microsoft into the trust’s top holding for the third quarter.
Shares of Microsoft averaged $264.05 during the third quarter; the stock is modestly undervalued based on its price-to-GF Value ratio of 0.77 as of Thursday.
Gates co-founded the Redmond, Washington-based software giant in April 1975. Microsoft has a GF Score of 97 out of 100, driven by a rank of 10 out of 10 for profitability and growth, a GF Value rank of 9 out of 10, a financial strength rank of 8 out of 10 and a momentum rank of 5 out of 10.
Other gurus with holdings in Microsoft include Ken Fisher (Trades, Portfolio)’s Fisher Investments, PRIMECAP Management (Trades, Portfolio) and Dodge & Cox.
Canadian National Railway
The trust invested in 44,548,156 shares of Canadian National Railway (CNI, Financial), expanding the position by 433.41% and its equity portfolio by 14.15%.
Shares of Canadian National Railway averaged $119.14 during the third quarter; the stock is fairly valued based on its price-to-GF Value ratio of 0.99 as of Thursday.
The Montreal, Quebec-based railroad company has a GF Score of 90 out of 100 based on a momentum rank of 10 out of 10, a profitability rank of 9 out of 10, a growth rank of 8 out of 10, a GF Value rank of 6 out of 10 and a financial strength rank of 5 out of 10.
Waste Management
The trust added 16,600,672 shares of Waste Management (WM, Financial), boosting the position by 89.09% and its equity portfolio by 7.83%.
Shares of Waste Management averaged $165.07 during the third quarter; the stock is fairly valued based on its price-to-GF Value ratio of 0.97 as of Thursday.
The Houston-based waste services company has a GF Score of 84 out of 100 based on a momentum rank of 9 out of 10, a profitability rank of 8 out of 10, a growth rank of 7 out of 10, a GF Value rank of 6 out of 10 and a financial strength rank of 4 out of 10.
Deere & Co
The trust purchased 3,018,038 shares of Deere & Co. (DE, Financial), boosting the position by 335.47% and its equity portfolio by 2.97%.
Shares of Deere & Co averaged $342.56 during the third quarter; the stock is fairly valued based on its price-to-GF Value ratio of 1.06 as of Thursday.
The Moline, Illinois-based agriculture equipment company has a GF Score of 85 out of 100, driven by a momentum rank of 9 out of 10 and a rank of 8 out of 10 for profitability and growth despite financial strength and GF Value ranking just between 4 and 5 out of 10.
Waste Connections
The trust invested in 2,149,175 shares of Waste Connections (WCN, Financial), giving the position 0.85% of equity portfolio space. Shares averaged $136.35 during the third quarter; the stock is modestly undervalued based on its price-to-GF Value ratio of 0.83 as of Thursday.
The Vaughan, Ontario-based waste and recycling service provider has a GF Score of 88 out of 100 based on a momentum rank of 9 out of 10, a GF Value rank of 7 out of 10, a financial strength rank of 5 out of 10 and a rank of 8 out of 10 for profitability and growth.
The Kraft Heinz
The trust purchased 2,622,600 shares of The Kraft Heinz (KHC), giving the holding 0.26% equity portfolio weight. Shares averaged $37.15 during the third quarter; the stock is fairly valued based on its price-to-GF Value ratio of 1.06 as of Thursday.
The Pittsburgh-based food and beverage company has a GF Score of 70 out of 100 based on a rank of 7 out of 10 for profitability and momentum, a GF Value rank of 5 out of 10, a financial strength rank of 4 out of 10 and a growth rank of 2 out of 10.
Warren Buffett (Trades, Portfolio)’s Berkshire Hathaway Inc. (BRK.A)(BRK.B) owns 325,634,818 shares of Kraft Heinz, giving the position 3.67% equity portfolio weight.
