TT - Tracking Al Gore's Generation Investment Management Portfolio - Q2 2023 Update

2023-08-24 23:45:33 ET

Summary

• Al Gore's 13F portfolio value increased by approximately 10% to $20.65B in Q2 2023.
• The top five stakes in the portfolio are Microsoft, Amazon.com, Applied Materials, Analog Devices, and Henry Schein.
• New positions in the portfolio include Waters Corp., Tigo Energy, and Veeva Systems.

This article is part of a series that provides an ongoing analysis of the changes made to Generation Investment Management's 13F portfolio on a quarterly basis. It is based on Al Gore's regulatory 13F Form filed on 8/11/2023. Please visit our Tracking Al Gore's Generation Investment Management Portfolio series to get an idea of their investment philosophy and our previous update for the fund's moves in Q1 2023.

This quarter, Al Gore's 13F portfolio value increased ~10% from $18.78B to $20.65B. The number of positions increased from 41 to 44. The top five stakes are Microsoft, Amazon.com, Applied Materials, Analog Devices, and Henry Schein. They account for around ~32% of the total 13F portfolio value. Generation Investment Management's whitepapers and Al Gore's books are good precursors for anyone interested in investing based on sustainability analysis.

New Stakes:

Waters Corp. ( WAT ), Tigo Energy ( TYGO ), and Veeva Systems ( VEEV ): These are the new positions this quarter. WAT is a 1.88% of the portfolio position purchased this quarter at prices between ~$249 and ~$312 and the stock currently trades at ~$271. Tigo came to market in May through a De-SPAC transaction. Generation IM has a 13.8% ownership stake in Tigo Energy. The position goes back to a Series C funding round in 2011. The stock currently trades at $11.21. VEEV is a very small 0.48% stake established this quarter.

Stake Increases:

Amazon.com ( AMZN ): AMZN is currently the second largest position at 8.46% of the portfolio. It was purchased during H1 2021 at prices between ~$158 and ~$175. There was a ~40% stake increase during H1 2022 at prices between ~$104 and ~$170. The stock currently trades at ~$132. The last four quarters have seen minor increases.

Applied Materials ( AMAT ): The ~6% AMAT stake was established in Q2 2019 at prices between ~$39 and ~$45. There was a ~45% increase during Q2 2022 at prices between ~$86 and ~$129. There was a ~38% further increase over the last four quarters. The stock currently trades at ~$143.

Analog Devices ( ADI ): ADI position is now at 4.89% of the portfolio. It was established in Q2 2018 at prices between $87 and $102 and doubled in the next quarter at prices between $91 and $100. The stake has wavered. Recent activity follows. There was a ~80% stake increase in Q2 2022 at prices between ~$144 and ~$169. H2 2022 saw a ~15% further increase while last quarter saw a marginal reduction. The stock currently trades at ~$174. There was a minor ~2% increase this quarter.

Thermo Fisher Scientific ( TMO ): TMO is a ~4% portfolio position first purchased in Q3 2016 and more than doubled the following quarter at prices between $141 and $159. Q2 2017 saw another ~20% increase at prices between $152 and $176. There was a one-third selling in 2019 at prices between $221 and $327. 2020 had seen another ~60% selling at prices between ~$255 and ~$528. The stake was rebuilt in Q2 2021 at prices between ~$441 and ~$509. There was a ~50% reduction over the two quarters through Q1 2022 at prices between ~$524 and ~$667. The last quarter saw a two-thirds increase at prices between ~$535 and ~$605. That was followed by a ~8% increase this quarter. The stock currently goes for ~$538.

Gartner, Inc. ( IT ): The 3.54% of the portfolio IT stake was built in 2020 at prices between ~$83 and ~$164. The five quarters through Q4 2021 had seen a ~60% selling at prices between ~$120 and ~$340. The stock is now at ~$339. The last several quarters saw minor trimming while this quarter there was a ~2% increase.

CBRE Group ( CBRE ): CBRE is a ~3% of the portfolio position built during Q2 & Q3 2020 at prices between ~$35 and ~$56. There was a ~45% selling over the four quarters through Q1 2022 at prices between ~$80 and ~$109. This quarter saw a similar increase at prices between ~$70 and ~$81. The stock is now at $83.56.

Danaher Corp. ( DHR ): DHR is a 2.88% of the portfolio position established during the last two quarters at prices between ~$225 and ~$277 and the stock currently trades at ~$254.

Twilio Inc. ( TWLO ): TWLO is a 2.68% of the portfolio position primarily built during Q2 2022 at prices between ~$79 and ~$175. There was a two-thirds stake increase during H2 2022 at prices between ~$43 and ~$98. The last two quarters also saw a ~19% further increase. The stock is now at ~$59.

Cognizant Technology ( CTSH ), Coupang ( CPNG ), H World Group ( HTHT ), Carlisle Companies ( CSL ), Freshworks Inc. ( FRSH ), and Microchip Technology ( MCHP ): These very small (less than ~0.20% of the portfolio each) stakes were increased this quarter.

Stake Decreases:

Microsoft Corporation ( MSFT ): MSFT is currently the largest stake at 8.47% of the portfolio. It was primarily built during Q2 2022 at prices between ~$242 and ~$315. The last quarter saw a ~30% stake increase at prices between ~$222 and ~$288. The stock currently trades at ~$320. There was marginal trimming this quarter.

Henry Schein ( HSIC ): HSIC became the largest position in Q4 2017 as it saw a ~550% stake increase at prices between $50.50 and $68.50. There was another ~22% increase next quarter at prices between $47 and $63.50. The five quarters through Q3 2019 saw a combined ~30% reduction at prices between $58 and $71 while in Q1 2020 there was a similar increase at prices between ~$43 and ~$74. Since then, there have only been minor adjustments. The stock is now at $76.20 and the stake at 4.82% of the portfolio.

Note: The prices quoted above are adjusted for the spinoff of Covetrus Inc. last January. Also, HSIC split 2-for-1 in September 2017. Generation IM has a ~9% ownership stake in Henry Schein.

Equifax Inc. ( EFX ): The 4.38% EFX stake was purchased in Q1 2019 at prices between $91 and $115. Q4 2020 saw a whopping ~175% stake increase at prices between ~$137 and ~$195. Q2 to Q4 2021 saw the position sold down by ~70% at prices between ~$181 and ~$297. The stake was doubled in the next quarter at prices between ~$208 and ~$286. The stock is now at ~$196. There was a ~20% trimming over the last two quarters.

Trane Technologies plc ( TT ): TT is now at ~4% of the portfolio position. The stake saw a ~150% stake increase in Q1 2022 at prices between ~$143 and ~$195. That was followed with a ~40% increase next quarter at prices between ~$121 and ~$155. The stock currently trades at ~$199. There was a ~20% trimming in the last two quarters.

Texas Instruments ( TXN ): The bulk of the 3.76% stake in TXN was established during the two quarters through Q1 2023 at prices between ~$148 and ~$185. The stock is now at ~$166. This quarter saw marginal trimming.

MercadoLibre ( MELI ): The 3.33% of the portfolio stake in MELI was built during the five quarters through Q3 2022 at prices between ~$635 and ~$1950. The stock is now at ~$1215. There was a ~18% trimming in the last two quarters.

Jones Lang LaSalle Inc. ( JLL ): JLL is a 3.26% long-term position first purchased in 2008. By 2013, that original position was doubled to a fairly large ~5% stake through consistent buying every year. The next two years saw selling: ~75% overall reduction at prices between $103 and $178. The pattern reversed in 2016: ~500% increase at prices between $91 and $141. That was followed with a ~30% increase in Q2 2017 at prices between $103 and $125. Since then, the activity has been minor. The stock currently trades at ~$167.

Note: Generation IM has a ~9% ownership stake in Jones Lang LaSalle.

Palo Alto Networks ( PANW ): The 3.17% PANW stake saw a ~20% increase last quarter at prices between ~$134 and ~$200. The stock currently trades at ~$227. There was marginal trimming this quarter.

Mastercard Inc. ( MA ): MA is a 2.76% of the portfolio position purchased during Q2 2022 at prices between ~$309 and ~$379 and the stock currently trades at ~$398. There was a ~20% selling this quarter at prices between ~$360 and ~$394.

Charles Schwab ( SCHW ): SCHW is currently at 2.55% of the portfolio. The stake was first purchased in Q4 2016 at prices between $31 and $40.50. Since then, the position was increased substantially at prices between ~$30 and ~$50. Q1 2021 saw a ~37% selling at prices between ~$51.50 and ~$68. That was followed with a ~20% reduction next quarter at prices between ~$63.50 and ~$76. The stock is now at $57.84. There was a ~15% stake increase during Q3 2022 while the last two quarters saw a ~35% reduction.

Note: SCHW has seen a previous round-trip. A large ~7.2M share stake purchased in 2013 in the high-teens price-range was disposed the following year at much higher prices.

Becton, Dickinson ( BDX ): The 2.43% BDX position was built in 2020 at prices between $201 and $284. There was a ~30% stake increase in Q4 2021 at prices between ~$236 and ~$257. Q2 2022 saw a similar reduction at prices between ~$235 and ~$275. That was followed with a ~40% further selling last quarter at prices between ~$218 and ~$257. The stock currently trades at ~$277. There was marginal trimming in the last two quarters.

Nutanix ( NTNX ): The 2.26% NTNX stake was established in Q2 2019 at prices between ~$25 and ~$43. The stock currently trades at ~$30. The last two quarters saw a ~25% trimming.

Note: they have a ~7.3% ownership stake in the business.

Cooper Companies ( COO ): The bulk of the 2.12% position in COO was purchased in Q4 2016 at prices between $159 and $183. The original stake was doubled in Q1 2018 at prices between $218 and $251 and that was followed with a ~37% increase next quarter at prices between $218 and $237. There was a ~25% reduction in Q2 2021 at prices between ~$372 and ~$412. Q1 2022 also saw a ~15% selling at prices between ~$380 and ~$428. Q4 2022 saw a ~30% stake increase at prices between ~$249 and ~$334. There was a similar reduction this quarter at prices between ~$346 and ~$392. The stock currently trades at ~$370.

Clarivate Plc ( CLVT ): CLVT is a 2.02% of the portfolio stake purchased in Q3 2021 at prices between ~$21.50 and ~$27.15. There was a one-third stake increase next quarter at prices between ~$20.50 and ~$25.25. Q1 2022 also saw a similar increase at prices between ~$12.25 and ~$24.50. The stock currently trades at $7.10. The last three quarters have seen minor trimming.

Note: Generation IM has a ~6.5% ownership stake in Clarivate plc.

10x Genomics ( TXG ), Baxter International ( BAX ), DENTSPLY SIRONA ( XRAY ), PTC Inc. ( PTC ), Remitly Global ( RELY ), Salesforce ( CRM ), STERIS plc ( STE ), and Toast Inc. ( TOST ): These small (less than ~2% of the portfolio each) stakes were reduced during the quarter.

Kept Steady:

SOPHiA GENETICS ( SOPH ): Sophia Genetics had an IPO last July. Shares started trading at ~$16.75 and currently goes for $2.36. Generation IM's 0.15% of the portfolio stake goes back to a funding round in 2019.

Note: Generation IM has a ~10.5% ownership stake in the business.

Asana, Inc. ( ASAN ), Gogoro Inc. ( GGR ), Proterra Inc. ( OTC:PTRAQ ) , and SPDR S&P 500 ETF ( SPY ): These minutely small (less than ~0.20% of the portfolio each) stakes were kept steady this quarter.

Note: Generation IM's original investment in Proterra goes back to a funding round in 2017. Proterra filed for Chapter 11 bankruptcy protection earlier this month.

Below is a spreadsheet that highlights the changes to Al Gore's Generation Investment Management 13F stock portfolio as of Q2 2023:

For further details see: