When investors consider the best Bill Gates stocks to buy, they generally refer to the assets held by the Bill and Melinda Gates Foundation Trust. The trust was created in October 2006 to manage the foundation’s assets.
The trust holds the endowment assets, including Warren Buffett’s annual gift of Berkshire Hathaway (NYSE:BRK.B). In 2006, Buffett earmarked 10 million Class B shares to the trust over time. Each July, 5% of any remaining shares are transferred to the trust. Eventually, the 10 million shares will be exhausted.
However, the Oracle of Omaha has donated additional shares to the trust in the years since. In 2021, Buffett donated almost 15.2 million Class B shares to the foundation and four family charities. As of March 31, the trust held 28.69 million Berkshire Class B shares. It accounts for 51.2% of the trust’s $19.8 billion in total assets.
Berkshire Hathaway is one of 18 stocks held by the trust. Here are three of the best Bill Gates stocks to buy now.
|BRK.B||Berkshire Hathaway Inc.||$273.86|
|KOF||Coca-Cola FEMSA, S.A.B. de C.V.||$56.68|
Berkshire Hathaway (BRK.B)
In the first quarter, the trust sold five million Class B shares. The foundation uses the cash from these sales to finance all the philanthropic projects it’s involved in across the globe. The sale is not an assessment of Berkshire Hathaway’s prospects in the coming years.
Interestingly, because the trust closed out or reduced its position in 12 stocks in the first quarter, Berkshire’s share of the endowment portfolio increased by 737 basis points from 43.9% at the end of Q4 2021.
Over the past three months, Berkshire stock has gotten hit hard by a declining market. It has a total return of -22.4%, significantly higher than the entire U.S. market, which is down 13.8%.
A big reason for the decline is the company’s massive stock portfolio. Currently, it’s $325 million in size, accounting for 34% of its total assets.
Despite the hit over the past three months, BRK.B stock is down 6.9% in 2022, far less than the entire U.S. market, which is off 18.5%. So, it could always be worse.
I consider Berkshire to be a top-notch value fund that doesn’t charge any fees. Long-term, it will do just fine.
Coca-Cola FEMSA (KOF)
Coca-Cola FEMSA (NYSE:KOF) is the largest franchise bottler of The Coca-Cola Company (NYSE:KO) in the world, accounting for 11% of Coca-Cola’s worldwide volume.
In fiscal 2021, KOF served more than 266 million people in Mexico, Central America, Colombia, Venezuela, Brazil, Uruguay and Argentina. As a result, it generated $9.9 billion in revenue with $1.9 billion in operating cash flow.
Part of its growth strategy is developing a direct-to-consumer platform for the more than 600,000 consumers it already sells to in Mexico. It already dominates the Mexican beverage market, at more than three times the sales of also-ran PepsiCo (NASDAQ:PEP).
Part of this strategy includes digitizing its business. In fiscal 2021, it generated $360 million in digital revenue. Through April 2022, it had already generated $300 million in digital revenue. Across all of its markets, it’s experiencing double-digit digital revenue growth.
Coca-Cola FEMSA is part of the Bloomberg Gender Equality Index. It has made the cut for four consecutive years.
KOF is the Gates trust’s eighth-largest holding. It holds 6.2 million shares of the beverage company. It was one of the few stocks the trust didn’t reduce its position in the first quarter.
KOF stock is up 8% year-to-date and 14.1% over the past 12 months, significantly better than the entire U.S. market. As for Pepsi stock? Down 4.2% as 2022 approaches the half-way point.
The iconic maker of charcoal and gas barbeques hasn’t had an easy time as a public company. Weber (NYSE:WEBR) went public in August 2021 at $14. The stock gained 18% on its first day of trading. It’s now trading 41% below its IPO price.
Weber’s not a significant position in the trust — it’s the 17th largest out of 18 — however, those 2.5 million shares represent a 4.8% stake in the company. That’s more than double the ownership of its directors and executive officers.
In the company’s second-quarter 2o22 report, Weber grew its sales by 46% compared to its sales in Q2 2020. Unfortunately, its adjusted loss in the quarter was $34 million compared to an adjusted profit of $98 million a year earlier.
For all of 2022, it expects revenues and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of at least $1.65 billion and $140 million, respectively.
Trading at 0.23x sales, it is the value play of these three best Gates stocks to buy.
On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.