Bill Gates has invested billions of dollars in stocks to fund the Seattle-based Bill & Melinda Gates Foundation Trust, widely regarded as the world’s largest private foundation, formed through the merger of the William H. Gates Foundation and the Gates Learning Foundation. According to the Trust, its aim is to address major humanitarian concerns such as poverty, a lack of opportunity, and infectious diseases. Over the past 30 years, Bill and Melinda have contributed an estimated $47.7 billion of their fortune to their foundation and predecessor. The foundation’s trust maintains a highly concentrated equities portfolio, reflecting the influence of Bill Gates and his longtime friend and former foundation trustee, Warren Buffett.
The Bill & Melinda Gates Foundation has set a record $8.74 billion budget for 2025, with intentions to increase yearly distributions to $9 billion the following year. Mark Suzman, the foundation’s CEO, stated that the record approval by its governing council is consistent with the foundation’s goal of a world “where everyone, everywhere, deserves the chance to live a healthy, productive life.”
Previously regarded as an aspect of science fiction, AI appears to have entered ordinary life and is now finding its way to consumers and businesses. Bill Gates predicts that by 2035, artificial intelligence will take over roles traditionally held by doctors, teachers, and other professionals, ushering in what he calls the era of “free intelligence.” According to Gates, this transition will result in rapid advancements in AI technology that will become firmly integrated into daily life, ranging from better healthcare solutions and more accurate diagnoses to broad access to AI tutors and virtual assistants.
However, while the potential is enormous, Gates admits that there are “understandable and valid” concerns about AI’s existing capabilities. In a 2023 blog post, he stated that even the most advanced AI systems make mistakes and can contribute to the spread of misinformation. Still, Gates is optimistic: if he were to establish a new firm today, he told CNBC Make It in September 2024, it would be an “AI-centric” startup.
For this list, we picked stocks from Bill & Melinda Gates Foundation Trust’s 13F portfolio as of the end of the fourth quarter of 2024. These equities are also popular among elite hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Caterpillar Inc. (CAT): Among the Dividend Stocks with Sustainable Payout Ratios
A construction crew operating a hydraulic shovel during a nighttime project.
Bill & Melinda Gates Foundation Trust’s Stake: $2.66 billion
Number of Hedge Fund Holders: 62
Caterpillar Inc. (NYSE:CAT), often referred to as CAT, is a leading American manufacturer of construction, mining, and engineering equipment. The company is a key player in the industry, having been recognized as the world’s largest maker of construction equipment.
On April 16, Morgan Stanley analyst Angel Castillo raised Caterpillar Inc. (NYSE:CAT) from Underweight to Equalweight, while also lowering the price target to $283 from $300. The upgrade follows a significant loss in Caterpillar’s share price since mid-October, with a drop of over 30% and a performance lag of around 20% behind the S&P 500. Castillo stated that, despite the lower price target, the change in the stock’s rating reflects the market’s assessment of Caterpillar’s near-term risks and long-term prospects. The analyst pointed out that the current share price more effectively reflects the downside risks to earnings, especially considering Morgan Stanley’s projections, which are around 10% lower than the consensus for the company’s 2025 earnings per share.
Caterpillar Inc. (NYSE:CAT) reported $16.2 billion in revenue in the fourth quarter of 2024, a 5% decrease from the same period last year. This dip was primarily caused by a $859 million fall in sales volume, which was driven by reduced dealer inventories and lower demand from end users. That said, Caterpillar Inc. (NYSE:CAT) maintained solid financial health in 2024, earning $12.0 billion in operating cash flow and ending the year with $6.9 billion in cash.
Overall CAT ranks 5th on our list of Bill & Melinda Gates Foundation Trust’s stock picks. While we acknowledge the potential for CAT as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than CAT but trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
