We recently compiled a list of the 10 Best Stocks to Buy According to Bill Gates.In this article, we are going to take a look at where Waste Management, Inc. (NYSE:WM) stands against the other stocks.
Bill Gates is one of the most influential figures in the modern world. The software company he co-founded, best known for its Windows operating system, ranks among the most valuable companies globally, boasting a market capitalization of $3 trillion. This success has contributed to Gates becoming one of the wealthiest individuals, with his net worth recently estimated at $108 billion.
In 2000, Bill and Melinda Gates established the Bill & Melinda Gates Foundation, now one of the world's largest charitable organizations. The foundation focuses on public health, poverty reduction, education, and climate change. Since 1994, the Gateses have contributed over $50 billion to its initiatives, including more than $1.94 billion in grants for vaccine research during the COVID-19 pandemic.
According to a report by Business Insider, Bill Gates, Melinda French Gates, and Warren Buffett have collectively contributed around $100 billion to the Gates Foundation to date. During an interview with the BBC, the Microsoft co-founder and Gates Foundation chair disclosed the extent of his philanthropic efforts. According to a foundation fact sheet, Gates and French Gates, who are now divorced, donated a total of $59.5 billion between the organization's inception in 2000 and the end of 2023. Meanwhile, Buffett, the CEO of Berkshire Hathaway, has contributed an additional $39.3 billion.
The foundation has been a major financial backer of the National Institutes of Health (NIH) for malaria and tuberculosis vaccine research. It also played a pivotal role in launching Gavi, the Vaccine Alliance, which spearheads immunization efforts in low-income nations. Headquartered in Seattle, the foundation continues to expand its global impact. Following a $20 billion donation, Gates outlined plans to boost its annual spending by 50%, targeting $9 billion by 2026.
Bill Gates has dedicated years and billions of dollars to addressing climate change. His foundation has directed substantial funding toward climate technology solutions while consistently highlighting major sources of greenhouse gas emissions, particularly those from large energy and manufacturing companies that burn fossil fuels extensively. However, Gates believes that many people overlook one of the significant contributors to climate change: agriculture, particularly methane emissions from livestock and the impact of fertilizers.
Since 2015, Breakthrough Energy, the climate-focused investment firm he founded, has allocated $2.2 billion to more than 160 startups and initiatives, aiming to generate investor returns while reducing emissions. In addition to these investments through the firm, Gates has also pursued climate-focused ventures independently. Some of these startups focus on practical solutions, such as sealants to improve heating efficiency, while others explore more unconventional approaches, including burying plant waste to capture carbon dioxide from the atmosphere.
As of Q4 2024, The Gates Foundation, managed by Michael Larson, has a portfolio valued at over $42 billion. The tech and industrial goods sectors represented 29% and 26.3% of the portfolio, respectively. The finance sector made up over 21% of the fund’s portfolio. In view of this, we will take a look at the best stocks to buy according to Bill Gates.
Our Methodology
To make our list of the latest stocks in Bill Gates’ portfolio, we scanned through the Bill & Melinda Gates Foundation’s SEC filings for the fourth quarter and picked out the top ten stocks with the highest investment stakes.
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).
Is Waste Management Inc. (WM) the Best Water Stock to Buy According to Hedge Funds?
Aerial view of a Waste Management Transfer Station, highlighting the scale of its operations.
Waste Management, Inc. (NYSE:WM) is the leading provider of comprehensive waste management environmental services in North America. The company serves more than 20 million residential, commercial, industrial, and municipal customers through its Collection, Landfill, Transfer, Recycling, and Other lines of business.
Waste Management, Inc. (NYSE:WM) had an impressive Q4 2024 with revenue of around $5.9 billion, up 13% YoY, driven by a strong market demand, ongoing asset network expansions, and efficiencies in Collection and Disposal services. However, the company’s still adjusted EPS slipped by 2.3% to $1.70, affected by elevated operational costs. WMI showed a strong financial performance in 2024, as its operating cash flow grew more than 14% to $5.39 billion, and free cash flow before sustainability growth investments reached $3.27 billion, marking a 22.5% increase over 2023. The company returned $1.47 billion to its shareholders last year, including more than $1.2 billion in dividends. WMI recently raised its dividend by 10%, marking its 22nd straight annual dividend raise.
Waste Management, Inc. (NYSE:WM) continued to grow its portfolio with an impressive shopping spree in 2024. The company closed $800 million worth of acquisitions in the first three quarters of last year, before acquiring Stericycle (the largest medical waste management company in North America) for $7.2 billion in Q4, all while also funding $950 million in sustainability growth initiatives. The company is now expecting synergies worth $250 million from the Stericycle acquisition by 2027 and is confident it will deliver up to $100 million even in 2025.
Overall WM ranks 3rd on our list of the best stocks to buy according to Bill Gates. While we acknowledge the potential for WM 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. If you are looking for an AI stock that is more promising than WM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
