According to Forbes’ real-time billionaires list, Bill Gates is the ninth-richest person in the world, with an impressive net worth of $132.9 billion. Ranking behind the likes of Elon Musk, Bernard Arnault, Jeff Bezos, Larry Ellison, Mark Zuckerberg and others, Bill Gates certainly remains a prominent investor that many follow, for various reasons.

The Microsoft (NASDAQ:MSFT) founder has diversified his portfolio away from Microsoft stock over the years, investing his capital a number of different ways. There’s Strategic Investments, run as part of his Bill & Melinda Gates Foundation, which seeks to grow the capital available in the fund to target philanthropic efforts. Then there’s Cascade Investments, a private holding company where more of his capital is diversified and held in a private family office format. And, of course, there’s Bill Gates’ Microsoft holdings, which have continued to grow in value over time, with Microsoft currently sitting as the second most valuable company in the market.

Aside from Microsoft, let’s dive into a few of Bill Gates’ other investments, and whether they may suit your investment criteria.

Key Points About This Article:

• Bill Gates is among the most prominent tech billionaires in the world, in the top 10 rankings in terms of net worth globally.
• The Microsoft founder has continued to diversify his investments over time, and here are three of his top holdings investors may want to pay closer attention to.
• If you’re looking for some stocks with huge potential, make sure to grab a free copy of our brand-new “The Next NVIDIA” report. It features a software stock we’re confident has 10X potential.

Waste Management (WM)

Waste Management (NYSE:WM) stands out as a top stock in Bill Gates’ portfolio, showing its ability to thrive in uncertain times with the company providing a strong 2024 outlook. As a major waste management services firm (as its name clearly suggests), the company offers garbage collection, disposal, and recycling services across North America. The company’s recent growth has been buoyed by acquisitions over time, consolidating the relatively fragmented waste collection business across the continent. One of the company’s more recent deals is a $7.2 billion acquisition of Stericycle, which is expected to boost cash flow in FY25.

The company’s latest results were impressive, with Waste Management boasting 5.5% revenue growth (to $5.4 billion) and a record 30% EBITDA margin. Waste Management’s solid performance and strategic moves make it a strong choice amid market volatility.

Waste Management has continued to focus on core initiatives to boost margins through strategic differentiation and cost control. Leveraging its extensive assets and enhancing digital platforms, the company aims for long-term growth and maintaining its competitive edge, while continuing to improve service quality.

Valued at a $83.5 billion market capitalization, the company excels in waste collection, recycling, and resource recovery across North America. Based in Houston, the company operates landfill gas-to-energy facilities and transfer stations. Over the past year, WM’s shares surged 26.7%, outpacing the S&P 500’s 21.7% and the Vaneck Environmental Services ETF’s 8.1%. 

Canadian National Railway (CNI)

Canadian National Railway (NYSE:CNI) is a top blue-chip stock Bill Gates has continued to add over the years I’ve personally found intriguing. Other investors such as Warren Buffett have long focused on railroads for their cyclicality and exposure to very broad macroeconomic trends. In a sense, betting on a railroad operator to grow is making a bet that an overall economy will continue to grow over time. That’s an easy bet for a very long-term investor to make. 

The company is currently favored among many defensive investors due to Canadian National Railways’ defensive business model and consistently conservative earnings outlook. The stock has dipped of late. But the company’s resilience and increasingly favorable financial conditions suggest this holding should remain a solid long-term investment for Gates, and those looking to follow in his footsteps. 

Canadian National Railway has sustained earnings growth amid declining freight volumes and higher interest rates, with FY23 EPS rising 15% year-over-year. CN reported a 7% revenue increase in Q2 2024 and targets 10% to 15% EPS growth through 2026. That reflects some strong pricing power that other major companies simply don’t have. 

Caterpillar (CAT)

Caterpillar’s (NYSE:CAT) stock rose 4% late last month following its mixed Q2 results. Despite missing revenue estimates at $16.70 billion and sales volumes coming in lower than expected, demand for the company’s large excavators and higher prices drove strong EPS of $5.99, exceeding expectations. The company benefits from the $1 trillion federal infrastructure spending bill, boosting its performance. Over the past year, CAT stock has gained 17%, as investors continue to pile into on-shoring trades. 

Caterpillar’s profits have surged with spending remaining strong in the construction, mining, energy, and transportation sectors. Of course, these tailwinds can turn into headwinds on a dime, and this is yet another highly-cyclical stock that could be poised for downside in a recession. But for now, the company’s outlook remains strong. In 2022, Caterpillar’s management team projected operating margins and free cash flow (FCF) of $4-$8 billion. By Q4 2023, they increased the margin range by 1% and raised the FCF estimate to $5-$10 billion. Over time, long-term bulls may continue to benefit from additional guidance raises, as the company provides impressive quarterly earnings on a rather consistent basis. 

That said, Caterpillar’s latest results were mixed, with 2024 revenue expected to be slightly below 2023’s $67 billion. However, the company anticipates operating margins will exceed previous targets. Analysts project $66 billion in revenue for 2024, suggesting a 19% profit increase compared to earlier projections. The improved margin outlook could lead to higher future expectations for margins and free cash flow over time. 

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