- By James Li
During GuruFocus' annual model portfolio rebalance for 2021, the new stocks added to the Most Weighted Model Portfolio were Adaptive Biotechnologies Corp. (NASDAQ:ADPT), AerCap Holdings NV (NYSE:AER), Alibaba Group Holding Ltd. (NYSE:BABA), The Walt Disney Co. (NYSE:DIS), PG&E Corp. (NYSE:PCG) and Trinity Industries Inc. (NYSE:TRN).
Dow closes off intraday high as investors monitor election results and protests
On Wednesday, the Dow Jones Industrial Average closed at new record of 30,829.40, up 437.80 points from Tuesday's close of 30,391.60 despite hitting a new record intraday high of 30,934.99.
The 30-stock index soared Wednesday morning on the heels of the Georgia Senate runoff races leaning toward Democrat candidates. CNBC added that while a Democrat-controlled Senate could result in higher corporate taxes and regulations, the same outcome could facilitate the passing of additional coronavirus stimulus packages. Despite this, stocks sank in afternoon trading amid election result protests taking place at the U.S. Capitol.
Most Weighted Portfolio among top-performing model strategies in 2020
As such, investors may find opportunities in stocks that have the largest combined equity portfolio weights among gurus. Premium members can access the Aggregated Portfolio of Gurus, which tracks the number of gurus owning shares and the combined weights.
While the Most Broadly Held model portfolio ranks stocks on the number of gurus owning shares with combined weight acting as a tiebreaker, the Most Weighted model portfolio considers just the combined weight. Six stocks were added to the Most Weighted model portfolio during the 2021 rebalance.
The Most Weighted model portfolio purchased 152.24 shares of Adaptive Biotechnologies. Shares traded around $56.53 on Wednesday.
The Seattle-based commercial-stage biotech company aims to advance the field of immune-driven medicine by harnessing the inherent biology of the adaptive immune system. According to GuruFocus, the company's cash-to-debt ratio of 18.02 outperforms more than half of global competitors, suggesting good financial strength.
Gurus with large holdings in Adaptive Biotechnologies include Andreas Halvorsen (Trades, Portfolio)'s Viking Global and Julian Robertson (Trades, Portfolio)'s Tiger Management.
The model portfolio purchased 197.49 shares of AerCap. Shares traded around $46.24 on Wednesday; the stock is modestly undervalued based on its price-to-GF Value ratio of 0.78.
The Dublin-based company leases and finances commercial aircraft and engines. GuruFocus ranks the company's profitability 8 out of 10 on several positive investing signs, which include a 4.5-star business predictability rank and an operating margin that has increased approximately 0.8% per year on average over the past five years and is outperforming over 98% of global competitors.
Gurus with large holdings in AerCap include Donald Smith & Co. and David Einhorn (Trades, Portfolio)'s Greenlight Capital Re Ltd. (NASDAQ:GLRE).
The model portfolio purchased 38.68 shares of Alibaba. Shares traded around $235.64 on Wednesday; the stock is modestly undervalued with a price-to-GF Value ratio of 0.74.
GuruFocus ranks the Chinese e-commerce giant's profitability 9 out of 10 on several positive investing signs, which include profit margins and three-year revenue and earnings growth rates outperforming over 90% of global competitors.
Gurus with large holdings in Alibaba include PRIMECAP Management (Trades, Portfolio) and Ken Fisher (Trades, Portfolio)'s Fisher Investments.
The model portfolio purchased 49.69 shares of Walt Disney. Shares traded around $180.78 on Wednesday; the stock is significantly overvalued based on a price-to-GF Value ratio of 1.63.
GuruFocus ranks the Burbank, California-based entertainment giant's profitability 7 out of 10 on the back of operating margins outperforming 64.49% of global competitors.
The model portfolio purchased 722.5 shares of PG&E. Shares traded around $12.41 on Wednesday.
GuruFocus ranks the San Francisco-based utility company's financial strength 3 out of 10 on several warning signs, which include a low Piotroski F-score of 2, a weak Altman Z-score of 0.05 and a Beneish M-score that signals possible earnings manipulation.
The model portfolio purchased 341.13 shares of Trinity Industries. Shares traded around $28.12 on Wednesday; the stock is modestly overvalued based on a price-to-GF Value ratio of 1.19.
GuruFocus ranks the Dallas-based transportation company's profitability 6 out of 10: Operating margins are outperforming over 76.27% of global competitors despite three-year revenue and earnings growth rates underperforming over half of global transportation companies.
Disclosure: The author has no positions in the stocks mentioned but may initiate positions over the next 2-3 days.
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This article first appeared on GuruFocus.