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Are Fidelity's Recent Stock Buys And Sells Retirement Account Hot Sauce?

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Want to put Fidelity Investments' world-class research resources to work for your retirement accounts and your taxable portfolios? Of course you do.

Knowing how the Boston-based asset management giant has deployed the assets of shareholders in its stock mutual funds and balanced funds can help you make decisions about your own buys and sells.

For example, in the fourth quarter Fidelity trimmed its exposure to several big technology bellwether stocks. Not all Fidelity funds may act in lockstep, but overall the fund complex lightened its net share count in Facebook ( FB ) by 5.1%, according to Todd Rosenbluth, director of ETF & mutual fund research for CFRA, an independent research firm.

Facebook is ranked No. 4 on IBD's Internet-Content industry group, thanks in part to a strong 91 Composite Rating from IBD and 87% average earnings per share growth over the past three quarters. 99 is the highest possible rating, which is on a scale from 1-99.

[ibdchart symbol="fb" type="daily" size="threequarter" position="leftchart" ]

Fidelity's Facebook holding is now at its lightest quarter-end level since the end of 2013, Rosenbluth says in a new report for MarketScope Advisor.

Facebook has rallied 16% since the beginning in a year to an all-time high. Subsequent disclosures by Fidelity will reveal whether it's been a buyer of Facebook shares in the current period.

The fund complex also trimmed its net share count in Google-owner Alphabet's C-class shares ( GOOG ) by 5.6% and its A-class shares ( GOOGL ) by 1.4%. Alphabet has rallied 6% so far this year. It faded after clearing the 816.78 buy point of a flat base on Jan. 23. It's retaken the buy point.

Graphics chipmaker Nvidia ( NVDA ) was a third tech big name to be trimmed by Fidelity. Fidelity also trimmed ( CRM ), a provider of customer relationship management software.

IBD'S TAKE:Nvidia ranks No. 1 in IBD's Electronics-Semiconductor Fabless industry group, buoyed by a solid-gold 99 Comp Rating and six straight quarters of EPS growth acceleration. For details, check the stock's vital signs at IBD's Stock Checkup .

Still, tech remained Fidelity's biggest sector, accounting for 26% of the fund family's shareholders' money. That was an increase from Sept. 30's 24% and June 30's 23% weighting.

And many Fidelity funds, including some of its largest, remained owners of stock in which the overall complex made net trims.

For instance, now-$35.3 billion Fidelity Growth Company Fund (FDGRX) held Alphabet, Facebook, Microsoft, Nvidia and in its top 10 at year-end.

Tech-Sector Buys

And there were several tech names in which Fidelity made net increases in its share counts during Q4.

Fidelity boosted its share count in software giant Microsoft (MSFT) by 9.3% to 148 million shares. That was the highest share count since the end of 2014, Rosenbluth wrote.

That was the highest share count since the end of 2014, Rosenbluth wrote.

"A few other stocks that had double-digit percentage share increases include Autodesk (ADSK)," Rosenbluth told IBD, referring to the developer of computer-aided design software applications.


Financials were Fidelity's second-largest sector, with 15% of shareholders' assets. That increase took place as Fidelity increased its exposure to some big U.S. banks.

Bank of America (BAC), JPMorgan Chase (JPM) and Wells Fargo (WFC) all saw double-digit percentage share count growth, Rosenbluth wrote. He added, "CFRA thinks investor optimism for banks improved amid expectations for higher interest rates and regulatory reform."

President Trump and Congress are widely expected to lighten the regulatory restrictions on some banks.

In addition, Fidelity made a double-digit percentage increase in its share count in Capital One Financial (COF).

The $414.3 million Fidelity Blue Chip Value (FBCVX) held Alphabet, JPMorgan Chase and Wells Fargo in its top 10 at year end.


Fidelity had a 9% weight in industrials as of the end of Q4. Fidelity managers made a 53% net addition to their share count in aerospace and defense contractor Northrop Grumman (NOC) in the quarter. They added 6.7% to their shares in General Electric (GE).


Comcast (CMCSA) and Verizon (VZ) were two stocks in which Fidelity managers made double-digit share increases.

Tech was not the only space in which Fidelity funds made cuts. Fidelity managers made double-digit decreases to telecom titan AT&T (T), energy explorer and producer Chevron (CVX), medical products maker Medtronic (MDT) and to athletic apparel, footwear and equipment maker Nike (NKE).

Each of those decreases appears vindicated at this early point following the quarter. Comp Ratings for each of those stocks current range from an anemic 27 for Chevron to Nike's 59.

All of Rosenbluth's data applies to Fidelity's 232 stock and balanced funds (mixtures of stocks and bonds), which together hold nearly $1 trillion in shareholder assets, according to Morningtstar Inc.

Fidelity runs an additional 70 funds that hold bonds or commodities, accounting for an additional $233 billion in shareholder money.


P-s-s-st! Here's What Fidelity Has Been Buying And Selling

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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