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FMR LLC, also known as Fidelity Investments, is one of the largest institutional investors in the equity market. Therefore, it is worth investigating Fidelity's top equities, especially because there are significant differences as compared to its closest competitor, Vanguard Group. Fidelity is a truly global investment titan, with $1.5 trillion of assets under management. Fidelity's largest equity mutual fund, Contra fund has around $70 billion net asset value with an expense ratio of 0.92%. The most actively managed equity fund, Magellan, has about $20 billion in assets with a slightly lower expense ratio of 0.75%. With over 20 million investors through individual and institutional accounts, Fidelity is one of the most prominent institutions on the Wall Street.

As of the Q2 2011, Fidelity had a diversified portfolio of equities. Technology stocks constitute 21.26% of the holdings, followed by services (16.83%) and financial stocks (13.95%). Energy companies constitute 12.47% of the portfolio. According to Edgar Online, Fidelity increased its ownership of 1,388 stocks, while opening 218 new positions in the last quarter. I have examined the boldest 7 stock buys from a fundamental perspective, adding my O-Metrix Grading System where possible:

Company Name

Ticker

Shares Held

% Change

% of TSO*

O-Metrix Score

Covidien

(NYSE:COV)

32.36 million

New

6.56%

5.10

MasterCard

(NYSE:MA)

4.67 million

101%

3.87%

5.09

Amgen

(NASDAQ:AMGN)

39.86 million

48.57%

4.31%

3.55

CF Industrial

(NYSE:CF)

7.32 million

107.51%

10.21%

5.36

Mosaic

(NYSE:MOS)

13.26 million

224.17%

4.81%

4.08

Amazon.com

(NASDAQ:AMZN)

17.27 million

18.30%

3.80%

1.84

Accenture

(NYSE:ACN)

33.72 million

41.86%

5.23%

4.38

*TSO: Total Share Ownership by the Fidelity Funds. Data obtained from Finviz/Morningstar and is current as of August 24.

Covidien is a medical instrument manufacturer headquartered in Ireland with additional offices in Colorado and Massachusetts. Fidelity initiated a new purchase of 32.36 million shares in the last quarter. Total share ownership stands at 6.56%. Covidien is a highly profitable company with a gross margin of 56.47% and a net profit margin of 16.22%. Although the stock lost 7.1% in the last quarter, the year-to-date return is 13.45%. It is trading with a trailing P/E ratio of 14.1, and a forward P/E ratio of 11.93. The company offers a yield of 1.56%. Based on an annualized EPS growth estimate of 11.67%, it has a PEG ratio of 1.21 and an O-Metrix score of 5.1.

MasterCard is in a high momentum since January. The stock returned 18.53% in the last quarter. The year-to-date return is 45.35%. Fidelity owns 4.67 million shares and increased its holdings by 101% in the last quarter. Total share ownership stands at 3.87%. MasterCard is a highly profitable company with an operating margin of 50.65% and a net profit margin of 34.87%. It is trading with a trailing P/E ratio of 20.16, and a forward P/E ratio of 15.61. The yield of 0.18% is negligible. Based on an annualized EPS growth estimate of 18.11%, it has a PEG ratio of 1.11 and an O-Metrix score of 5.09.

Amgen is a biotechnology company headquartered in Thousand Oaks, California. The stock lost 9.34% in the last quarter. Fidelity owns 39.86 million shares and increased its holdings by 48.57% in the last quarter. Total share ownership stands at 4.31%. Amgen is a highly profitable company with a gross margin of 84.53% and a net profit margin of 29.72%. It is trading with a trailing P/E ratio of 11.28, and a forward P/E ratio of 9.67. Analysts have a mean target price of $64, implying almost 18% upside potential. Based on an annualized EPS growth estimate of 7.44%, it has a PEG ratio of 1.52 and an O-Metrix score of 3.55.

CF Industries Holdings is a major agricultural chemical producer headquartered in Deerfield, Illinois. The stock has been an outperformer, returning 16.48% in the last quarter and 30.31% since January. Fidelity owns 7.32 million shares and increased its holdings by 107.51% in the last quarter. Total share ownership stands at 10.21%. It is one company that Fidelity is wildly bullish about. CF Industries is a highly profitable company with a gross margin of 39.88% and a net profit margin of 22.11%. It is trading with a low trailing P/E ratio of 12.43 and a lower forward P/E ratio of 9.61. Analysts have a mean target price of $185, implying about 9% upside potential. Based on an annualized EPS growth estimate of 10.93%, it has a PEG ratio of 1.14 and an O-Metrix score of 5.36.

Mosaic lost 6.5% in the last month and 11.49% since January. Fidelity owns 13.26 million shares and increased its holdings by 224.17% in the last quarter. Total share ownership stands at 4.81%. Vanguard is also bullish on Mosaic, increasing its holdings by 70.21% in the last quarter with a total share ownership of 2.60%. Similar to CF Industries, Mosaic has attractive ratios. It is priced with a low trailing P/E ratio of 11.98, and a forward P/E ratio of 10.74. Dividend yield is 0.3%. Analysts mean target price of $83.32 implies 26% upside potential. Based on an annualized EPS growth estimate of 9%, it has a PEG ratio of 1.33 and an O-Metrix score of 4.08.

Amazon.com lost 9.55% in the last month, but has returned 7.63% since January. Fidelity owns 17.27 million shares and increased its holdings by 18.30% in the last quarter. Total share ownership stands at 3.8%. As of Aug. 24, Amazon was trading at $193, significantly higher than my fair-value range of $73.94 - $91.04. Its price to book ratio of 11.33 is well-above the market. It is a very risky company to invest in. While the gross margin of 22.45% is OK, the net profit margin of 2.55% is a red flag. Those holding Amazon stock for the long term may want to consider selling the stock and realizing their profits. Even with an annualized EPS growth estimate of 26.44%, the stock has a PEG ratio of 3.23 and an F-Grade O-Metrix score of 1.84.

Accenture is a diversified management consulting company headquartered in Dublin. It also offers technology and outsourcing services around the globe. Fidelity owns 33.72 million shares and increased its holdings by 41.86% in the last quarter. Total share ownership stands at 5.23%. The stock was doing fine until July. However, it collapsed from $64 to $47 in the recent sell-off panic, then bounced back to $51. The year-to-date return is 6%. As of Aug. 24, the stock was trading with a P/E ratio of 16.18 and a forward P/E ratio of 13.52. It offers a yield of 1.77%. Analysts estimate an annualized EPS growth of 11.23% in the next 5 years. Based on these estimates, Accenture has a PEG ratio of 1.44 and an O-Metrix score of 4.38.

Find more information on O-Metrix Grading System here.

Source: 7 Bold Buys For Fidelity Mutual Funds