Bill Gates has donated billions of Microsoft’s Direccoft Dispost to the Bill and Melinda Gates Foundation since 2000.
Longtime friend Warren Buffett has also been a major donor.
The high holdings of the portfolio reflect Buffett’s influence.
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Bill Gates is one of the richest people in the world, but he has no intention of staying that way.
With an estimated net worth of $106 billion, Gates will give away at least 99% of his wealth to his charitable foundation by the end of 2045 (when he turns 90, when he turns 90, when he turns 90, when he turns 90, when he turns 90, when he turns 90, when he turns 90, when he turns 90, when he turns 90 90, if he is 90, if he is 90, if he is 90, if he is 90, if he is 90, if he is 90, if he is 90, if he is 90, if he is with us). He has already given it a significant amount, donating billions of dollars to it Microsoft(NASDAQ: MSFT) Sharing the foundation since he and his now wife, Melinda, found it in 2000. In addition, the gates aim to study the use of money in the next two decades as it works to fight poverty around the world.
The Trust Fund is working to support that goal. Based on the most recent 13f filing with the Securities and Exchange Commission, Equity Founday’s marketable portfolio is highly concentrated. While it holds figures in twelve stocks, just three account for more than two-thirds of the portfolio’s value.
Image Source: Getty Images.
Despite the foundation selling several million shares of stock recently, Microsoft remained its largest holding as of the end of the second quarter. That position comes largely from the large offering of nearly 39 million shares that the gates made in 2022. The Trust held 26.2 million shares from $13.9 billion as of this writing.
Microsoft has received some important changes since the portals returned to daily operations in 2008. It has emerged as a leader in its product space, thanks to its initial investment in OpenAi. It has been able to build a solid foundation of AI services into Azure, its computing platform, and has also built productive AI functionality into its Microsoft 365 Production Suite. Both these products contributed to the growth of the business drive.
Azure is now a $75 billion business and growing rapidly. In fact, its revenue growth accelerated last year as Microsoft worked to bring more AI-informed cloud capabilities online to meet strong demand. Management has continued to note that demand is on offer, just as tens of billions of dollars are being spent on spending each quarter after each quarter.
Meanwhile, Microsoft’s cash cow, its Enterprise Software business, is seeing strong two percent growth in virtual revenue thanks to new AI features that enable it to charge more and retain users better. That helps Microsoft’s Marive Cammer support for new data centers, because it continues to generate tens of billions of dollars in Free Cash Flow every quarter.
Investors have been rewarded with strong valuations, but the stock is still trading at a valuation of around 34 times forward earnings. Given Microsoft’s strength in two frames and a decent balance sheet and cash flow, the stock deserves a premium price.
For many years, the gate’s long-time friend Warren Buffett has made annual contributions to the foundation on the basis of Berkshire Hathaway(Nyse: Brk.B)(Nyse: Brk.A) shares. Those contributions come with the payment that the foundation puts all of Buffett’s annual contributions to use in the following year, and that it spends at least 5% of its assets. Even with that need, the trustees were able to build a strong position in Berkshire Wabelana over time. At the end of the second quarter, the trust held shares of 2.1 million b billion, worth $ 11.8 billion as of this writing.
Berkshire Hathaway has produced strong results so far this year, as its insurance business recovered after several years of strong performance. Several major disasters (including California wildfires) weighed on the results of the insurance segment in the first quarter. However, last quarter’s operating income came in above expectations, and if you exclude changes in foreign exchange rates, the results were much better.
Conglomolar’s stock portfolio has seen some minor changes over the past few years. Buffett has reduced his positions in several top holdings, and Berkshire’s balance sheet holds about $340 billion in cash and equity. Its positions in equity still exceed $650 billion.
Buffett and soon-to-be CEO Greg Abela was able to put that money to work recently with the acquisition of oxychem from Occidental Petroleum for $9.7 billion. This deal is considered a great value, and Berkshire was able to keep its preferred shares in Occidental, which pay 8% per year.
Berkshire Hathaway stock now trades at a price-to-book ratio of around 1.6. That is much higher than the level at which buffett has determined that the conglomerate will buy its stock (about 1.5), but it is also based on building a book that is reported as the end of the second quarter. Considering that its book value continued to rise in the third quarter completed, the stock may present an attractive opportunity now.
Waste Management(Nyse: wm) a long-time holder of the foundation gate and a prime example of Buffett’s influence on gates as an investor. A “boring business” with a wide moat of competition. The Trust rarely sells shares of stock, and currently holds 32.2 million shares worth about $6.7 billion.
Benefits of Waste Management from its formation and landfilling. Its scale allows it to design congested routes for its garbage trucks in cities, increasing operational efficiency. It also owns 262 landfills. Between those two advantages, its core businesses can achieve better margins than smaller competitors. Most importantly, its landfill ownership can be challenged by existing or new competitors, as there are regulatory constraints especially in making new landfills possible.
The scope of their competitive moat is also proven in its third results. The company’s acquisitions and disposals produced strong results, expanding its adjusted gross margin to 38.4%. However, low prices are putting a drag on their recycling business. In addition, its newly acquired pharmaceuticals business produced disappointing sales results. However, all that pessimism was not indicative of long-term challenges for the business.
At its investor day this summer, management provided readings of $28.5 billion to $29.25 billion with $29.5 billion for EBIBDA of $8.85 billion to $9.85 billion. For community games, that could reach average annual growth of 9% and 11%, respectively, over the next three years. That would be strong growth for the company, given its pricing and operational performance.
The company’s enterprise value of $ 106 billion is almost 14 times EBIBDA. That’s a fair price to pay for a company that’s growing EBITDA by around 11% a year, and it’s certainly worth holding the Gates Foundation Trust.
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Adam Levy holds positions at Microsoft. The Motley Fool has positions and recommends Berkshire Hathaway and Microsoft. The Motley Fool recommends Occidental Petroleum and WM and recommends the following options: Early January 2026 $395 Microsoft calls and $926 $40 The Motley Fool has a disclosure policy.
Billionaire Bill Gates has 67% of the Foundation’s $49 billion portfolio invested in 3 amazing stocks originally published by Motley Fool
