Wealthy Individual Ditches Stocks in Nvidia, Apple, and Microsoft, Choosing Instead to Invest in Dividend Shares Instead
Billionaire investor Stanley Druckenmiller is steering away from big tech giants like Nvidia, Microsoft, and Apple, and instead, is focusing on dividend and value-oriented stocks, particularly within the healthcare and pharmaceutical sectors.
According to recent reports, Druckenmiller holds a significant position in Natera Inc (NTRA), a company focused on precision medicine, with a value of $481 million, representing 15.72% of his portfolio. He has also notably increased his stake in Teva Pharmaceutical Industries (TEVA), worth $228 million, accounting for 7.47% of his portfolio, due to its stronger dividend-oriented profile.
In addition to healthcare and pharma stocks, Druckenmiller is also investing in high-quality industrials such as Taiwan Semiconductor Manufacturing (TSMC), a dominant chip foundry with significant market power and likely dividend potential.
Druckenmiller's move away from high-growth big tech stocks is further evidenced by his exit from Nvidia and Palantir. However, he has increased his stake in TSMC, a semiconductor company with substantial growth potential.
Druckenmiller, known for his timing, made his first investment in Nvidia when ChatGPT was introduced. Despite this, he has recently reduced his position in Nvidia by around 88%, as well as decreasing his holdings in Microsoft by over 60% and Apple nearly 80%.
In a surprising turn, Druckenmiller has also invested in the tobacco industry, purchasing 890,000 shares of Philip Morris International. The tobacco company, which currently has a dividend yield of 4.5%, operates in a market with pricing power and has 150 million consumers worldwide, including the famous cigarette brand Marlboro.
Philip Morris has a consistent track record of increasing its dividend every year since its IPO in 2008, with an annual growth rate of seven percent. The company also offers smoke-free alternatives like IQOS, which it sells in 90 out of 180 markets.
Druckenmiller has also shown interest in the energy sector, buying over 2.8 million shares of Kinder Morgan, a company responsible for 40% of the natural gas consumed in the U.S. Kinder Morgan offers additional growth potential through its LNG export facilities and can particularly benefit from falling interest rates due to the strong demand for housing.
The stock of Kinder Morgan is up over 20% year-to-date and has a dividend yield of over five percent. While a P/E ratio of 38 may not seem cheap, the average over the past ten years is 45.
Druckenmiller manages his money through Duquesne Family Office, which manages a fortune of nearly $3 billion. This shift in investment strategy towards real dividend champions suggests a new direction for the billionaire investor.
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