Top 4 3rd-Quarter Trades of the Bill & Melinda Gates Foundation Trust

James Li

Microsoft founder’s foundation trust boosts Berkshire holding

The Bill & Melinda Gates Foundation Trust disclosed recently that its top four trades during the third quarter were a position boost in Warren Buffett (Trades, Portfolio)’s Berkshire Hathaway Inc. (NYSE:BRK.A)(NYSE:BRK.B), a new holding in Boston Properties Inc. (NYSE:BXP) and sells of Schrodinger Inc. (NASDAQ:SDGR) and Arcos Dorados Holdings Inc. (NYSE:ARCO).

Microsoft Corp. (NASDAQ:MSFT) founder Bill Gates (Trades, Portfolio) and his wife Melinda founded the trust in 2000. According to the website, the Foundation Trust holds the endowment (including the annual installments of Buffett’s gift) and funds the foundation. A team of outside investment managers controls the fund’s assets.

The Bill & Melinda Gates foundation conducts all operations and grant making work. While Buffett is a trustee of the foundation, the “Oracle of Omaha” does not participate in the foundation trust’s investing operations including decisions regarding Berkshire stock.

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Foundation trust adds to Berkshire holding

The foundation trust added 7,191,874 Class B shares of Berkshire, increasing the position 18.02% and its equity portfolio 6.94%. Shares averaged $204.37 during the third quarter.

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According to GuruFocus, Berkshire’s positive investing signs include a high Piotroski F-score of 7, a three-star business predictability rank, a net profit margin that outperforms over 80% of global competitors and a return on assets that outperforms approximately 81% of global insurance conglomerates.

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Boston Properties

The trust purchased 1,099,310 shares of Boston Properties, giving the position 0.40% weight in the equity portfolio. Shares averaged $87.35 during the third quarter; the stock is modestly undervalued based on its price-to-GF-Value ratio of 0.73.

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GuruFocus ranks the Boston-based REIT’s financial strength 4 out of 10 on the heels of a weak Altman Z-score of 1.06 and a debt-to-equity ratio that underperforms 90% of global competitors. Despite this, the company’s profitability ranks 7 out of 10 driven on a 3.5-star business predictability rank and a return on assets that outperforms 77.7% of global REITs.

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Schrodinger

The trust sold 2 million shares of Schrodinger, trimming the position 28.65% and the equity portfolio 1.03%. Shares averaged $64.74 during the third quarter.

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GuruFocus ranks the New York-based health care company’s financial strength 7 out of 10 on the heels of a strong Altman Z-score and a debt-to-equity ratio that outperforms 80% of global competitors.

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Arcos Dorados

The trust sold 3,101,296 shares of Arcos Dorados, trimming the equity portfolio 0.07%. Shares averaged $4.55 during the third quarter.

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GuruFocus ranks the Uruguayan restaurant company’s financial strength 4 out of 10 on the back of debt ratios underperforming over 90% of global competitors, suggesting high financial leverage.

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Disclosure: No positions.

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About the author:

James Li

I am an editorial researcher at GuruFocus. I have a Master’s in Finance from SMU, and I enjoy writing reports on financial trends and investor portfolios. Follow me on Twitter at @JamesLiGuru!

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