TT - Tracking Al Gore's Generation Investment Management Portfolio - Q3 2023 Update

2023-11-27 21:17:36 ET

Summary

• Al Gore's 13F portfolio value decreased by 8% to $19B, with 43 positions.
• Top five stakes are Microsoft, Amazon.com, Applied Materials, Henry Schein, and Thermo Fisher Scientific.
• New stake in Trimble Inc., stake disposal in PTC Inc., stake increases in Microsoft Corporation and Danaher Corp.

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 11/13/2023. 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 Q2 2023.

This quarter, Al Gore’s 13F portfolio value decreased ~8% from $20.65B to $19B. The number of positions decreased from 44 to 43. The top five stakes are Microsoft, Amazon.com, Applied Materials, Henry Schein, and Thermo Fisher Scientific. They account for around one-third 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:

Trimble Inc. (TRMB): The 1.84% TRMB position was established this quarter at prices between ~$49 and ~$56. The stock currently trades below that range at $44.40.

Stake Disposals:

Proterra Inc. and PTC Inc. (PTC): Generation IM’s original investment in Proterra went back to a funding round in 2017. Proterra filed for Chapter 11 bankruptcy protection in August. The very small 0.32% stake in PTC was dropped during the quarter.

Stake Increases:

Microsoft Corporation ( MSFT ) : MSFT is currently the largest stake at ~9% of the portfolio. It was primarily built during Q2 2022 at prices between ~$242 and ~$315. Q1 2023 saw a ~30% stake increase at prices between ~$222 and ~$288. The stock currently trades at ~$379. There was a minor ~5% stake increase this quarter.

Thermo Fisher Scientific ( TMO ) : TMO is a 4.43% 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. Q1 2023 saw a two-thirds increase at prices between ~$535 and ~$605. That was followed by a ~12% increase during the last two quarters. The stock currently goes for ~$490.

Danaher Corp ( DHR ) : DHR is a 3.54% of the portfolio position established during the last two quarters at prices between ~$225 and ~$277 and the stock currently trades just below that range at ~$220. This quarter also saw a ~10% stake increase.

Nutanix ( NTNX ) : The 3.11% NTNX stake was established in Q2 2019 at prices between ~$25 and ~$43. The stock currently trades at ~$41. The last two quarters saw a ~25% trimming while this quarter saw a minor ~2% increase.

Note: they have a ~7.4% ownership stake in the business.

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. The last quarter saw a ~45% increase at prices between ~$70 and ~$81. The stock is now at $79. There was a marginal further increase this quarter.

Waters Corp ( WAT ) : WAT is a 2.41% of the portfolio position purchased last quarter at prices between ~$249 and ~$312 and the stock currently trades at ~$277. There was a ~14% stake increase this quarter at prices between ~$260 and ~$297.

H World Group ( HTHT ) : The very small 0.21% stake in HTHT was increased by ~16% during the quarter.

Stake Decreases:

Amazon.com ( AMZN ) : AMZN is currently the second largest position at 8.91% 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 ~$148. The last four quarters saw minor increases while this quarter there was marginal trimming.

Applied Materials ( AMAT ) : The large (top three) ~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. That was followed by a ~38% further increase over the last four quarters. The stock currently trades at ~$151. This quarter saw marginal trimming.

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 ~$68 and the stake at 4.75% 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.

Trane Technologies plc ( TT ) : TT is now at 4.24% 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 ~$226. There was a ~30% selling in the last three quarters.

Analog Devices ( ADI ) : ADI position is now at ~4% 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 this quarter saw a ~15% selling at prices between ~$172 and ~$199. The stock currently trades at ~$184.

Gartner Inc. ( IT ) : The 3.76% 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 ~$431. The last several quarters saw only minor adjustments.

Texas Instruments ( TXN ) : The bulk of the 3.59% stake in TXN was established during the two quarters through Q1 2023 at prices between ~$148 and ~$185. The stock is now at ~$153. The last two quarters saw marginal trimming.

Equifax Inc. ( EFX ) : The 3.43% 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 ~$212. There was a ~30% selling over the last three quarters.

MercadoLibre ( MELI ) : The 3.21% 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 ~$1599. There was a ~40% reduction in the last three quarters.

Jones Lang LaSalle Inc. ( JLL ) : JLL is a 3.18% 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 ~$155.

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

Mastercard Inc. ( MA ) : MA is a 2.80% of the portfolio position purchased during Q2 2022 at prices between ~$309 and ~$379 and the stock currently trades at ~$409. There was a ~20% selling last quarter at prices between ~$360 and ~$394. That was followed by a ~7% trimming this quarter.

Charles Schwab ( SCHW ) : SCHW is currently at 2.67% 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 $56. There was a ~15% stake increase during Q3 2022 while the last two quarters saw a ~35% reduction. This quarter also saw marginal trimming.

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.

Twilio Inc. ( TWLO ) : TWLO is a 2.66% 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 ~$63. There was marginal trimming this quarter.

Becton Dickinson ( BDX ) : The 2.57% 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 ~$239. There was marginal trimming in the last three quarters.

10x Genomics (TXG), Baxter International (BAX), Carlisle Companies (CSL), Clarivate plc (CLVT), Cooper Companies (COO), Coupang (CPNG), Cognizant Technology (CTSH), Dentsply Sirona (XRAY), Freshworks Inc. ( FRSH ) , Microchip Technology (MCHP), Palo Alto Networks (PANW), Remitly Global (RELY), Salesforce.com (CRM), SPDR S&P 500 ETF (SPY), Steris plc (STE), Tigo Energy (TYGO), Toast Inc. (TOST), and Veeva Systems (VEEV): These small (less than ~2.25% of the portfolio each) stakes were reduced this quarter.

Kept Steady:

SOPHiA GENETICS ( SOPH ) : SOPHiA GENETICS had an IPO last July. Shares started trading at ~$16.75 and currently goes for $3.81. 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), and Gogoro Inc. ( GGR ) : These minutely small (less than ~0.20% of the portfolio each) stakes were kept steady this quarter.

Below is a spreadsheet that highlights the changes to Al Gore's Generation Investment Management 13F stock portfolio as of Q3 2023:

Source: John Vincent. Data constructed from Generation IM’s 13F filings for Q2 2023 and Q3 2023.

For further details see: