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Tracking Jeremy Grantham's GMO Capital Portfolio - Q4 2022 Update

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This article is portion of a bid that provides an ongoing study of nan changes made to GMO’s 13F banal portfolio connected a quarterly basis. It is based connected GMO’s regulatory 13F Form revenge connected 2/13/2023. Jeremy Grantham’s 13F portfolio worth accrued ~8% from $17.33B to $18.77B this quarter. The portfolio is diversified pinch caller 13F reports showing good complete 500 different positions though astir of them are very small. There are 48 securities that are importantly ample (more than 0.5% of nan portfolio each) and they are nan attraction of this article. The largest 5 stakes are Microsoft Corporation, UnitedHealth, Johnson & Johnson, Apple, and U.S. Bancorp. They adhd up to ~15% of nan portfolio. Please sojourn our Tracking Jeremy Grantham’s GMO Portfolio bid to get an thought of their finance accuracy and our last report for nan fund’s moves during Q3 2022.

As of December 31, 2022, GMO’s 7-year plus people existent return forecast is for US Large Cap plus people to person a antagonistic 0.7% annualized return connected 1 extremity and Emerging Value plus people to person a affirmative 9.8% annualized return astatine nan different extreme. The patient presently has ~$70B nether management, a acold outcry from ~$120B that they had astatine nan peak. The assets are distributed among separately managed, institutional, and communal money accounts. Their emblem vessel communal money is GMO Benchmark-Free Allocation Fund (MUTF:GBMFX) which was incepted successful 2003.

Note 1: It was reported successful December 2020 that Jeremy Grantham has a ~4.8M stock liking successful QuantumScape (QS). The ~$12.5M finance was made 8 years agone arsenic portion of a bid of bets connected early-stage “green technology” companies.

Note 2: Jeremy Grantham has many times said nan US banal marketplace is successful a bubble since June 2020. The latest was a investigation note past August asking to hole for an “epic finale” to nan deflating of nan ace bubble. Their Q4 2022 missive had a somewhat affirmative hint stating, “lots of assets are cheaper than nan wide aggregates, and we would propose investors should beryllium looking to commencement moving into those now alternatively than hold to effort to clip nan marketplace bottom.”

Stake Increases:

Microsoft Corporation (MSFT): MSFT is presently nan apical position successful nan portfolio astatine 4.24%. It is simply a very semipermanent stake. The 2007-2008 play saw nan liking built from ~5.6M shares to complete 59M shares astatine prices betwixt $19 and $35. The position size peaked successful 2011 astatine ~68M shares. The adjacent 4 years saw nan liking sold down by ~80% astatine prices betwixt $28 and $56. Recent activity follows: nan 3 years done Q3 2020 saw a ~70% trading astatine prices betwixt ~$88 and ~$232. There was a ~9% trimming successful Q4 2021 while successful Q2 2022 location was a akin increase. The banal presently trades astatine ~$258. This 4th besides saw a ~6% liking increase.

U.S. Bancorp (USB): The 2.22% USB liking was purchased successful 2017 astatine prices betwixt $50 and $56 and nan banal presently trades beneath that scope astatine $48.60. Q1 2020 saw a ~50% liking summation astatine prices betwixt ~$29 and ~$55. Last respective quarters person seen only insignificant adjustments.

Amazon.com (AMZN): The 1.93% AMZN liking saw a immense ~130% liking summation this 4th astatine prices betwixt ~$82 and ~$121. The banal presently trades astatine $97.20.

Merck & Co. (MRK): MRK is simply a very semipermanent stake. In 2014, it was sold down to a very mini position astatine prices betwixt $50 and $62. The liking was rebuilt successful H1 2018 astatine prices betwixt $53 and $63. Q1 2020 saw a ~20% trading astatine prices betwixt ~$66 and ~$92. The 7 quarters done Q1 2022 had seen a ~30% liking summation astatine prices betwixt ~$69 and ~$88. There was a ~20% simplification adjacent 4th astatine prices betwixt ~$84 and ~$95. The banal presently trades astatine ~$110, and nan liking is astatine 1.86% of nan portfolio. This 4th saw a marginal increase.

Meta Platforms (META): META is simply a 1.84% of nan portfolio position purchased successful Q1 2018 astatine prices betwixt ~$160 and ~$190. The liking had seen incremental buying since. Last 3 quarters saw a ~125% liking summation astatine prices betwixt ~$90 and ~$235. The banal is now astatine ~$173.

Lam Research (LRCX): The 1.71% LRCX liking was built successful Q3 2020 astatine prices betwixt ~$294 and ~$385 and nan banal is now astatine ~$496. Last fewer quarters person seen insignificant buying.

Adobe (ADBE), Ameresco (AMRC), BorgWarner (BWA), Darling Ingredients (DAR), Exxon Mobil (XOM), Green Plains (GPRE), KLA Corp. (KLAC), Mosaic (MOS), Otis Worldwide (OTIS), Petroleo Brasileiro (PBR), Salesforce.com (CRM), SolarEdge Technologies (SEDG), STMicroelectronics (STM), Sunrun Inc. (RUN), and Visa Inc. (V): These mini (less than ~1.5% of nan portfolio each) stakes were accrued this quarter.

Stake Decreases:

UnitedHealth Group (UNH): The apical 3 ~3% of nan portfolio liking successful UNH was already a very ample ~18M stock position successful 2005. The position size peaked successful 2007 astatine complete 20.5M shares. The 5 years done 2019 had seen a ~75% trading astatine prices betwixt $102 and $296. That was followed pinch a ~25% simplification successful Q2 2022 astatine prices betwixt ~$452 and ~$546. The banal is now astatine ~$499. Last 2 quarters besides saw insignificant trimming. They are harvesting gains.

Johnson & Johnson (JNJ): JNJ is simply a very semipermanent stake. In their first 13F filing successful 2005, nan position was astatine ~170K shares. The sizing peaked astatine astir 26M shares successful 2009. The liking was sold down by ~40% successful 2014 astatine prices betwixt $88 and $109. 2016 saw different ~50% trading astatine prices betwixt $97 and $125. Recent activity follows. H2 2019 saw a 23% liking summation astatine prices betwixt $127 and $146. There was different one-third summation past 4th astatine prices betwixt ~$161 and ~$180. The banal presently trades astatine ~$160 and nan liking is astatine 2.76% of nan portfolio. This 4th saw a insignificant ~2% trimming.

Apple Inc. (AAPL): AAPL is simply a apical 5 2.22% semipermanent stake. It was a ample liking successful 2005 but was sold down adjacent year. The position was rebuilt successful 2007 but was again sold down adjacent year. Similar trading shape continued complete nan adjacent respective years. The 4 years done 2019 saw a ~75% simplification astatine prices betwixt ~$23 and ~$82. Q3 2020 saw different ~30% trading astatine prices betwixt ~$91 and ~$134. That was followed pinch a ~20% simplification past 4th astatine prices betwixt ~$137 and ~$175. The banal is now astatine ~$153. This 4th besides saw a ~6% trimming.

Oracle Corporation (ORCL): The ~2% ORCL position is simply a very semipermanent stake. The position was already astatine astir 14M shares successful 2007. The adjacent 2 years saw nan liking built to a overmuch larger 62M stock position astatine prices betwixt $15.50 and $24.50. Next fewer years saw trading astatine higher prices and by 2017 nan liking was backmost astatine 14M shares. The 5 quarters thru Q2 2019 saw different ~45% trading astatine prices betwixt $44 and $57. Q1 2020 besides saw a ~18% simplification astatine prices betwixt ~$40 and ~$56. The 3 quarters done Q2 2022 saw different ~30% trading astatine prices betwixt ~$64 and ~$104. The banal is presently astatine ~$87. Last 2 quarters person seen only insignificant adjustments.

TJX Companies (TJX): TJX is simply a ~2% of nan portfolio position that has been successful nan portfolio for good complete 15 years. The position has wavered. Last awesome activity was a ~25% liking summation successful H1 2020 astatine prices betwixt ~$37 and ~$63. The banal is now astatine ~$80. There was insignificant trimming successful nan past 2 quarters.

Coca-Cola (KO): KO is simply a 1.90% of nan portfolio stake. The position was already a ample 7M stock liking successful 2005. That original liking was built to 23.7M shares during nan 2007-2008 timeframe astatine value betwixt $20 and $32. The sizing peaked astatine almost 39M shares successful 2012. The adjacent 5 years saw nan position sold down by ~90% to a ~3.7M stock liking astatine prices betwixt $37 and $47. Recent activity follows. Q1 2020 saw a ~75% liking summation astatine prices betwixt $37.50 and $60. That was followed pinch a ~37% summation successful Q3 2020 astatine prices betwixt ~$44 and ~$51. Q2 2022 saw a akin simplification astatine prices betwixt ~$59 and ~$66. The banal is now astatine ~$60. There was insignificant trimming successful nan past 2 quarters.

Elevance Health (ELV): ELV position was first purchased successful 2014. The bulk of nan existent 1.87% portfolio liking was established successful 2017 astatine prices betwixt $144 and $232. There was a astir one-third trading successful H1 2022 astatine prices betwixt ~$428 and ~$530. The banal presently trades astatine ~$495. Last 2 quarters saw insignificant trimming.

Texas Instruments (TXN): TXN is simply a 1.93% of nan portfolio position. The mostly of nan liking was purchased successful Q3 & Q4 2016 astatine prices betwixt $63 and $75. There was a ~20% liking summation successful Q1 2022 astatine prices betwixt ~$163 and ~$191. The banal presently trades astatine ~$175. There was insignificant trimming successful nan past 3 quarters.

Alphabet Inc. (GOOGL): GOOG is simply a 1.88% position. The semipermanent liking was built during nan 2007-2014 timeframe astatine debased prices. The position size peaked successful 2014. Since then, nan liking was reduced astatine prices betwixt ~$25 and ~$150. The banal presently trades astatine ~$95. There was marginal trimming this quarter.

Accenture plc (ACN): ACN became a important portion of nan portfolio during nan 2013-2014 timeframe erstwhile astir 3.8M shares were purchased astatine prices betwixt $69 and $85. The adjacent 5 years had seen a mixed ~50% simplification done insignificant trading astir quarters. The 2 quarters done Q3 2021 saw different ~24% simplification astatine prices betwixt ~$295 and ~$415. The banal presently trades astatine ~$277 and nan liking is astatine 1.71% of nan portfolio. There was a ~9% trimming successful nan past 2 quarters.

Wells Fargo (WFC): The 1.64% WFC position was purchased successful Q3 2017 astatine prices betwixt $49.50 and $56. Q1 2020 saw a ~25% liking summation astatine prices betwixt ~$25 and ~$49. That was followed pinch a ~30% liking summation successful Q4 2020 astatine prices betwixt ~$21 and ~$30. There was a ~18% trading complete nan adjacent 2 quarters astatine prices betwixt ~$30 and ~$48. This 4th saw different ~27% simplification astatine prices betwixt ~$40 and ~$48. The banal is now astatine $47.49.

Intuitive Surgical (ISRG): ISRG is simply a 0.83% of nan portfolio position purchased successful Q2 2022 astatine prices betwixt ~$191 and ~$306. The banal presently trades astatine ~$239. Last 2 quarters person seen only insignificant adjustments.

AGCO Corp. (AGCO), Abbott Labs (ABT), American Express (AXP), BP p.l.c. (BP), Canadian Solar (CSIQ), Constellation Brands (STZ), Cigna (CI), Eli Lilly (LLY), Global Payments (GPN), Kosmos Energy (KOS), Medtronic (MDT), Quest Diagnostics (DGX), Teck Resources (TECK), Taiwan Semi (TSM), and UBS Group AG (UBS): These very mini (less than ~1.5% of nan portfolio each) positions were reduced this quarter.

Note: GMO has important ownership stakes successful nan pursuing businesses: Gyrodyne (GYRO), GrafTech (EAF), Clean Energy Fuels (CLNE), Canadian Solar (CSIQ), Aemetis (AMTX), and Adecoagro (AGRO).

Below is simply a spreadsheet that shows nan changes to Jeremy Grantham's GMO Capital 13F portfolio holdings arsenic of Q4 2022:

Jeremy Grantham - GMO Capital's Q4 2022 13F Report Q/Q Comparison

Jeremy Grantham - GMO Capital's Q4 2022 13F Report Q/Q Comparison (John Vincent (author))

Source: John Vincent. Data constructed from GMO Capital's 13F filings for Q3 2022 and Q4 2022.

Editor's Note: This article discusses 1 aliases much securities that do not waste and acquisition connected a awesome U.S. exchange. Please beryllium alert of nan risks associated pinch these stocks.

This article was written by

John Vincent floor plan picture

Focused connected cloning strategies by analyzing 13F reports of a curated group of astir 50 super-investors and generating Absolute Returns thru exploiting inefficiency, volatility, and momentum.

Disclosure: I/we person a beneficial agelong position successful nan shares of AAPL, AMZN, GOOGL, META either done banal ownership, options, aliases different derivatives. I wrote this article myself, and it expresses my ain opinions. I americium not receiving compensation for it (other than from Seeking Alpha). I person nary business narration pinch immoderate institution whose banal is mentioned successful this article.

Editor: Naga



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