<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Spiros Segalas (Trades, Portfolio), manager of the Harbor Capital Appreciation Fund, disclosed this week that his fund’s top five buys for the second quarter were Tencent Holdings Ltd. (HKSE:00700), American Tower Corp. (NYSE:AMT), Eli Lilly and Co. (NYSE:LLY), Netflix Inc. (NASDAQ:NFLX) and Goldman Sachs Group Inc. (NYSE:GS).” data-reactid=”12″>Spiros Segalas (Trades, Portfolio), manager of the Harbor Capital Appreciation Fund, disclosed this week that his fund’s top five buys for the second quarter were Tencent Holdings Ltd. (HKSE:00700), American Tower Corp. (NYSE:AMT), Eli Lilly and Co. (NYSE:LLY), Netflix Inc. (NASDAQ:NFLX) and Goldman Sachs Group Inc. (NYSE:GS).
The Chicago-based fund seeks steady investment growth primarily through investments in the common stock of U.S. companies with a market cap of at least $1 billion. Through rigorous research and visits with top management, Harbor Capital invests in companies with strong balance sheets, sales momentum, high profitability, unique market positions and capable management.
Harbor Capital’s $30.17 billion equity portfolio contains 56 stocks as of April 30. The portfolio’s top three sectors in terms of weight are technology, consumer cyclical and communication services, representing 34.44%, 22.42% and 15.22% of the equity portfolio.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Tencent” data-reactid=”34″>Tencent
Harbor Capital purchased 7,989,126 shares of Tencent, giving the stake 1.39% weight in the equity portfolio. Shares averaged 321.10 Hong Kong dollars ($41.43) during the quarter.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The Shenzhen, Guangdong-based company operates a wide range of internet services, including social media platform WeChat, online games and utilities. GuruFocus ranks Tencent's profitability 9 out of 10 on several positive investing signs, which include a five-star business predictability rank and profit margins that are outperforming over 85% of global competitors.” data-reactid=”49″>The Shenzhen, Guangdong-based company operates a wide range of internet services, including social media platform WeChat, online games and utilities. GuruFocus ranks Tencent’s profitability 9 out of 10 on several positive investing signs, which include a five-star business predictability rank and profit margins that are outperforming over 85% of global competitors.
Other gurus with holdings in Tencent include Bestinfond (Trades, Portfolio), the Matthews China Fund (Trades, Portfolio) and the Matthews Pacific Tiger Fund (Trades, Portfolio).
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="American Tower” data-reactid=”73″>American Tower
The fund added 1,532,862 shares of American Tower, increasing the position 2,265.10% and the equity portfolio 1.21%. Shares averaged $236.58 during the quarter.
The Boston-based real estate investment trust owns and operates over 180,000 cell towers around the globe. GuruFocus ranks American Tower’s profitability 9 out of 10, driven by a high Piotroski F-score of 7, a 4.5-star business predictability rank and a return on equity that outperforms 98.46% of global competitors.
The fund added 2,115,646 shares of Eli Lilly, increasing the holding 89.77% and the equity portfolio 1.08%. Shares averaged $141.78 during the quarter.
The Indianapolis-based company manufactures pharmaceutical products for the treatment of cancer, osteoporosis, diabetes and other maladies. GuruFocus ranks Eli Lilly’s profitability 8 out of 10: Although the company’s positive investing signs include expanding operating margins and strong returns on equity, its three-year revenue growth rate underperforms 52.09% of global competitors.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Netflix” data-reactid=”127″>Netflix
Harbor Capital added 593,406 shares of Netflix, increasing the position 21.6% and the equity portfolio 0.83%. Shares averaged $375.47 during the quarter.
GuruFocus ranks the Los Gatos, California-based streaming giant’s profitability 8 out of 10 on several positive investing signs, which include a 4.5-star predictability rank, a return on assets that outperforms over 83% of global competitors and an operating margin that has increased approximately 18% per year on average over the past five years.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Goldman Sachs” data-reactid=”152″>Goldman Sachs
The fund added 1,306,650 shares of Goldman Sachs, increasing the stake 542.94% and the equity portfolio 0.79%. Shares averaged $190.68 during the quarter.
GuruFocus ranks the New York-based investment bank’s financial strength 2 out of 10 on the back of equity-to-debt and debt-to-equity ratios underperforming over 89% of global competitors, suggesting high financial leverage. Despite this, net profit margins and returns on equity are outperforming over 64% of global peers.
Disclosure: No positions.
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