CLVT - Tracking Al Gore's Generation Investment Management Portfolio - Q1 2023 Update

2023-05-24 03:54:53 ET

Summary

• Generation Investment Management’s 13F portfolio value increased from $17.32B to $18.78B this quarter.
• They increased Microsoft Corporation, Thermo Fisher Scientific, Texas Instruments, and Palo Alto Networks while decreasing Charles Schwab, Toast, Baxter International, and Ptc Inc. They also dropped Alibaba and Trimble.
• The top three positions are Microsoft, Amazon.com, and Henry Schein, and they add up to ~20% of the portfolio.

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 5/12/2023. 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 Q4 2022.

This quarter, Al Gore's 13F portfolio value increased ~8% from $17.32B to $18.78B. The number of positions remained steady at 41. The top five stakes are Microsoft, Amazon.com, Henry Schein, Analog Devices, and Applied Materials. They account for around ~30% 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:

Danaher Corp ( DHR ): DHR is a ~2% of the portfolio position established this quarter at prices between ~$240 and ~$277 and the stock currently trades below that range at ~$230.

Stake Disposals:

Alibaba Group Holding ( BABA ) and Trimble Inc. ( TRMB ): These small (less than ~2% of the portfolio each) stakes were disposed this quarter.

Stake Increases:

Microsoft Corporation ( MSFT ): MSFT is currently the largest stake at ~8% of the portfolio. It was primarily built during Q2 2022 at prices between ~$242 and ~$315. This quarter saw a ~30% stake increase at prices between ~$222 and ~$288. The stock currently trades at ~$315.

Amazon.com ( AMZN ): AMZN is currently the second largest position at ~7% 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 ~$115. The last three quarters have seen minor increases.

Applied Materials ( AMAT ): The ~5% 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 ~23% further increase over the last three quarters. The stock currently trades at ~$125.

Thermo Fisher Scientific ( TMO ): TMO is a 4.55% 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. This quarter saw a two-thirds increase at prices between ~$535 and ~$605. The stock currently goes for ~$525.

Texas Instruments ( TXN ): The bulk of the 4.28% stake in TXN was established during the last two quarters at prices between ~$148 and ~$185. The stock is now at ~$170.

Palo Alto Networks ( PANW ): The 2.76% PANW stake saw a ~20% increase this quarter at prices between ~$134 and ~$200. The stock currently trades at ~$190.

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 in the last two quarters at prices between ~$43 and ~$98. This quarter also saw a minor ~4% increase. The stock is now at ~$59.

Gogoro Inc. ( GGR ) and SPDR S&P 500 ETF ( SPY ): These very small (less than ~0.20% of the portfolio each) stakes were increased this quarter.

Stake Decreases:

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. The stock is now at ~$77 and the stake at 5.38% of the portfolio. The last three years have seen only minor adjustments.

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.

Analog Devices ( ADI ): ADI position is now at 5.33% of the portfolio. It was established in Q2 2018 at prices between $87 and $102 and doubled 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. The last two quarters saw a ~15% further increase while this quarter saw a marginal reduction. The stock currently trades at ~$188.

Trane Technologies plc ( TT ): TT is now at 4.64% 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 ~$168. There was a ~13% trimming this quarter.

Equifax Inc. ( EFX ): The 4.51% 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 next quarter at prices between ~$208 and ~$286. The stock is now at ~$210. There was a ~13% trimming this quarter.

MercadoLibre ( MELI ): The 4.34% 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 ~$1300. There was a ~13% trimming this quarter.

Gartner Inc. ( IT ): The 3.53% 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 ~$325. The last several quarters have seen minor trimming.

Mastercard Inc. ( MA ): MA is a 3.47% of the portfolio position purchased during Q2 2022 at prices between ~$309 and ~$379 and the stock currently trades at ~$374. There was minor trimming in the last three quarters.

Jones Lang LaSalle Inc. ( JLL ): JLL is a 3.40% 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 ~$141.

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

Charles Schwab ( SCHW ): SCHW is currently at 3.25% 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 $52.79. There was a ~15% stake increase during Q3 2022 while this quarter saw a similar 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.

Cooper Companies ( COO ): The bulk of the 3.24% 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. Last quarter saw a ~30% stake increase at prices between ~$249 and ~$334. The stock currently trades at ~$380. There was marginal trimming this quarter.

Nutanix ( NTNX ): The 2.80% NTNX stake was established in Q2 2019 at prices between ~$25 and ~$43. The stock currently trades near the bottom of that range at $25.55. There was a ~9% trimming this quarter.

Note: they have a ~9% ownership stake in the business.

Becton, Dickinson ( BDX ): The 2.54% 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 ~$247. There was marginal trimming this quarter.

Clarivate plc ( CLVT ): CLVT is a 2.24% 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 well below those ranges at $7.58. The last two quarters have seen minor trimming.

Note: Generation IM has a ~6.6% ownership stake in Clarivate plc.

CBRE Group ( CBRE ): CBRE is a 2.11% 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 stock is now at $76.13. The last two quarters saw marginal trimming.

Toast Inc. ( TOST ): The 1.47% TOST stake saw a ~45% stake increase last quarter at prices between ~$17 and ~$22. There was a ~25% reduction this quarter at prices between ~$16 and ~$26. The stock currently trades at $20.52.

Note: Generation IM's original investment in Toast goes back to a funding round in 2017. They have a 4.7% ownership stake in the business.

Baxter International ( BAX ): BAX is now at 1.44% of the portfolio. It was established in Q4 2019 at prices between $76.50 and $88.50 and increased by ~50% next quarter at prices between ~$72 and ~$93. Q1 2021 saw another ~20% stake increase at prices between ~$76 and ~$86. There was a ~50% selling over the last four quarters at prices between ~$50 and ~$87. That was followed with a ~40% reduction this quarter at prices between ~$37 and ~$53. The stock currently trades at $42.50.

10x Genomics ( TXG ), Cognizant Technology ( CTSH ), Carlisle Companies ( CSL ), Dentsply Sirona ( XRAY ), H World Group ( HTHT ), Microchip Technology ( MCHP ), PTC Inc. ( PTC ), Remitly Global ( RELY ), Salesforce.com ( CRM ), and STERIS plc ( STE ): 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 $4.96. Generation IM's 0.18% 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 ), Freshworks Inc. (FRSH), and Proterra Inc. ( PTRA ): 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.

Below is a spreadsheet that highlights the changes to Al Gore's Generation Investment Management 13F stock portfolio as of Q1 2023:

For further details see: