10 Stocks of Mr. Wonderful in the market crash

One of the things I like to do is review the stock portfolios of some of the most famous investors out there by taking their top 10 largest holdings, and ranking them from best to worst, and giving my quick opinion on each one of those stocks. As we go through the list. 

In today's article, we're going to be looking at Mr. Wonderful's stock portfolio investor that I've been wanting to review for a long time. Now, of course, this is kevin o leary famous for being one of the rich investors on the popular TV show Shark Tank, which I've also been a big fan of myself. 

And the interesting thing is that when looking at those holdings, in the last quarter, Mr. Wonderful actually increased those positions. So he's actively buying the stocks this year, even at a time when the stock market is essentially crashing.

And I'm very intrigued by that alone and we'll count down from 10 to one and it's going to be from the smallest position to the largest. 

Okay, so as of the last quarter, his investment firm or shares, Investment Advisors held a stock portfolio worth well over a billion dollars. And all of this information is coming from stock zoa.com For reference.

#10. Number

Stock number 10 is going to be the UnitedHealth Group ($UNH) at 1.7% of the portfolio and worth over $20 million. Now, this is a giant healthcare insurance company that I actually used to be interested in myself mostly for the dividend. But I hold off on buying the stock just because of all the political pressure to offer free health care, especially in America.

Which would obviously hurt their business in a big way. So I kind of just hold off on it myself. However, that hasn't happened, at least not yet. And as a result, both their sales and profits have still been growing consistently for years reaching a monstrous close to $300 billion of revenue last year alone, with growth still expected to be in the double-digit percentage this year of over 11% year over year. 

Now that really strong performance so has sent the stock skyrocketing by close to 200% over the past five years and is still sitting near a 52-week high at a time when the rest of the market is mostly crashing, I got to say I really liked their business. And I think it's an incredibly well-run company that I would enjoy investing in. 

But at these levels of valuation is a little rich compared to the sector and the dividend is a little low at just 1.3% yield. And because of the growing risk to their business and free health care, I'm personally just not that interested in buying the stock right now. And that's I'll have to rank them somewhere around the middle at the number 6 for now. 

#9. Number

The stock number nine, we've got McDonald's ($MCD) at about 2% of the portfolio and worth close to $25 million. And because of their convenient and low-priced options, McDonald's has been a fast food that staples for decades, which has allowed them to generate steady financials over the years. 

And 2020 was of course a dip year because of all the lockdowns. But they did quickly recover from that the following year to both record-breaking sales and profits. They're also doing a great job of adapting to Digital Trends with their mobile ordering options and are even expanding internationally as well. In fact, US sales only grew by around 3% last quarter.

But international sales surged by over 20%. However, because of the recent decision to exit out of the Russian market, their sales are expected to be about flat this year before returning to low single-digit growth next year. And despite that weakness, the stock is still holding up pretty well given that it's only about $20 away from an all-time high. 

Unfortunately, though, that means that the dividend yield is a little small at just around 2%. While the valuation is very high at over 100% more expensive than the sector. I feel very similarly about McDonald's as they do about UnitedHealth.

But I think United is a better value if it can avoid heavy damage from a healthcare revolution. So I'll put McDonald's just barely behind them. And number seven, for now.

#8. Number

We've got a stock that I have always been interested in owning myself but just always kind of felt that it was a little too expensive and that is Lockheed Martin ($LMT) at over 2% of the portfolio and worth over $27 million. And they're of course famous for being a giant military and defense company.

Which is along with competing very heavily in several markets like cybersecurity, aerospace, weapons, and aviation. You know have really a lot of them there. Now, the products can all range from developing naval ships to armored vehicles and helicopters and fighter jets, you've got rocket missiles, and you even have space shuttles and satellites.

As a business. They've also been able to generate strong sales and profits over the years, especially with all the craziness going on in the world that has helped them reach a new record high in sales last year. However, coming off of such a large performance and given the current state of the economy where we're currently facing a possible recession.

Orders for their high-priced products may need to take a breather, and the sales are expected to be about flat over these next couple of years. While their profits by EPS are also expected to grow at around half the rate over the next five years compared to the previous five. 

The result of all this is that Lockheed has turned into a super volatile stock over the years and timing when the right time to buy it can be a real challenge. In the five-year chart, investors in LMT, though will argue that it's easy to hold long-term because you get a very strong business.

With a reliable dividend that carries some excellent growth metrics on it while currently yielding around 2.6%. Personally, though, my buying target is if the yield climbs above 3%, because we've seen that happen several times in recent years, so I know it can get there. 

But just because the business is so strong and likely to perform well over the long term considering that the world will always invest heavily in weapons and defense, especially with all the rising tension with other major powers like Russia and China.

I just think that this is still a better long-term option over UnitedHealth and McDonald's, so I'll rank them in the number five spot for now.

#7. Number

We've got stock number seven, that's going to be a stock that I've always enjoyed tracking, and that is Home Depot($HD) at close to 2.5% of the portfolio and worth over $30 million. And what I personally like about Home Depot, myself is just how strong of a business they have in retail Home Improvement while also doing a great job of expanding into online sales as well, which I think is very surprising. 

They've already become the fifth most market share in America, of all online retail which is very impressive. And because of the pandemic and resulting lockdowns, they saw a giant surge in sales to a record high of over $150 billion as people stayed home and worked on various projects.

Which gave HD growth of over 20% in fiscal 2021 and 14% in 2022, although that's finally slowing back down to the low single digits these next two years because of prior strong performance as well as the weakening macroeconomy. On the bright side, though, that's causing the stock to crash by over 30% from its highs already and is now sitting close to a 52-week low. 

Now my gut tells me that right now is probably a good price to buy the stock for the long term, especially as a dividend growth stock because it's got some excellent growth metrics on that dividend. But the reason why I still hold off on it myself is because the yield is still a little low and less than 3%. 

And the valuation continues to be high, even after the dip as they're currently still trading over 50% More expensive than the sector. So for me, I think it's very similar to Lockheed Martin, but I like Home Depot's financials and the dividend growth just a tiny bit more. So I will put HD and number four, just barely ahead of Lockheed.

#6. Number

Stock number six, we've got the first stock on the list that I actually own myself too. So I'm a little excited talking about this one. But that is the giant pharmaceutical biotech company known as Pfizer ($PFE), at close to 2.5% and worth over $30 million dollars. 

And really the reasons why I own Pfizer is not only because of their dominant business that nearly doubled both their sales and profits last year, thanks to their pepperoni V shot while still having a huge pipeline of nearly 100 different products coming in the future. 

And a number of new acquisitions like an Arena for $7 billion, Revival for half a billion, and Biohaven for a whopping $12 billion. But they also pay a very nice dividend with over a 3% yield. Yet it still has a very low payout ratio of only around 30% and a growth history of over a decade in a row. 

And despite the stock trading somewhat close to its highs, the valuation is actually really low at around 50% cheaper than the sector. It's definitely my favorite stock on the list so far. And because I do also own it myself. I'm just going to have to put them in the number one spot for now until we see what else is on the list. 

#5. Number

At number five, we've got another one that I'm currently invested in with Apple($AAPL) at 2.5% of his portfolio and worth $32 million now Apple is super easy to explain. It's got one of the stickiest businesses in the world thanks to their various products and services like phones, watches, computers, tablets, headphones, and more. 

And these things get you hooked on the ecosystem, and it keeps you coming back to upgrade and add new products and services. The result is gigantic sales and profits with over $350 billion in sales and almost 100 billion of net income just last year alone, which is helping fuel investment back into their own stock with share buybacks.

Which is leading to higher EPS growth over the next five years than the previous five. They also have one of the best balance sheets in the world with over $200 billion of cash and investments, while also paying a little small dividend of about 0.6%. But one that also has a very tiny payout ratio of less than 15%. 

So I would say it's very safe. Apple stock is almost always a buy, in my opinion, if you are thinking about the long-term kind of reliability and stability of the company in the business. But that is especially the case, I would say right now since they are going through a rare dip of over 20%. 

And while I prefer the dividend from Pfizer, I still think that Apple is generally the safer option just because of how massively large they are. So I'm gonna move Pfizer down to number two, and I'll have to put the apple in its place and number one. 

#4. Number

Stock number four, we've got another stock that I actually own myself and I gotta say I'm starting to really like Mr. Wonderful's investing style because he seems to like a lot of the same dividend stocks that I like. But coming in at number four, that's going to be the telecommunications and Internet giants Verizon ($VZ) at close to 3% of the portfolio, and worth $35 million. 

And like Apple, this is another one that is very easy to explain why someone would want to own it, because there's simply the highest quality of their respective market. Not only does Verizon have more wireless phone subscribers and ATT and T Mobile, not only do they have more fiber Internet subscribers but they also have the highest customer service satisfaction as well. 

As a result, they've been able to generate 10s of billions of dollars of cash flow over the years, which helps them feel a giant dividend of over 5%, which is probably still safe, even at these really high levels, thanks to the low payout ratio of below 50%. And the large growth history.

I would say to have nearly two decades that tells me management is you know probably committed to paying that dividend over the long term. And while the stock can be pretty volatile at times right now is probably a good buying opportunity considering that the valuation is around 40% cheaper than the sector Not to mention that the dividend yield rarely climbs above 5%. 

And it is currently sitting at a higher level right now than any other average throughout its entire history. So my gut tells me that the stock will have to climb higher over the long term to balance all of that out. The only thing that I don't like about Verizon is that they are super low growth in their financials, so your gains may have to come in large part from the dividend. 

Honestly, I feel that they are exactly tied with Pfizer in terms of attractiveness, but because Verizon does have that mouthwatering dividend of 5% Right now, I'm gonna just barely squeezed them ahead of Pfizer into the number two spot and I'll very reluctantly slide Pfizer down number three even though again, I feel that they really should be tied.

#3. Number

We're now breaking into the final three stocks. These are the top three largest holdings of Mr. Wonderful and coming in at number three. That's going to be Procter and Gamble($PG) at over 3% of the portfolio and worth over $40 million. Now PG is the owner of a ton of popular household brands.

Like Tide, Gain, Charmin, Pampers, Gillette, Downy, Vicks, NyQuil, Febreeze, Crest, Oral B, and Duracell, they even own IMEs dog food and the list goes on and on. And the result is that they have very strong financials that are stable even through economic downturns, which has allowed them to grow their dividend for an unbelievable over six decades in a row. 

However, my issue with them is that the yield is a little low and less than 3%. The business is low growth in the low single-digit percentage for revenue. And despite the stock rarely ever dipping by any large amount, it's only up by less than 70% in the past five years, yet it still trades around 20 to 40% more expensive than the sector.

It's a good long-term dividend stock if you want stability with a business that can easily survive economic downturns, but it's not as exciting as some of the other stocks on the list. So I'm gonna have to place them just barely ahead of UnitedHealth at the number six spot and move United down to number seven and McDonald's down to number eight in a row. 

#2. Number

The top two now, stock number two is going to be Johnson and Johnson ticker symbol j&j at 3.5% of the portfolio and valued at $44 million. Now, like PG j&j also has a very strong business with incredibly strong brands,

like Johnson's lotions and powders of vino, Benadryl, Listerine, Tylenol, Band Aid and many more, really a huge mix of popular household brands with lots of pharmaceutical and healthcare-related products too.

However, because of historical lawsuits coupled with disappointing sales and performance of their pepperoni V shot, this stock has been suppressed over the years and is only up about 35% In the past five years.

The good news though, is that it's left the valuation cheaper than the sector with a dividend yield of around 2.5% that has been grown by almost six decades in a row and has a solid payout ratio below 50%. 

The financials are always strong to breaking new records last year, around 100 billion in sales and 20 billion in profits, and are still managing to grow by low single-digit percentages in future years. For me, though, it's just not high growth enough to invest in However, I still like them a little bit more than Procter and Gamble.

Because they have about the same dividend with also a very strong business, but they have a much cheaper valuation. So I'll put them slightly higher, and number six.

#1. Number

The the last stock on the list. This is the absolute largest of the portfolio. And the funny thing is that this is also my personal largest stock in my portfolio as well. But that is of course, Microsoft ($MSFT) at over 4% of the portfolio, and worth close to $60 million. And just a quick correction for this, he actually decreased his position in this stock by 2% last quarter.

While all the other stocks were an increase of around 5%. So it was the only stock of the top 10 that we've talked about so far, that he actually decreased it a little. And what's funny is that this is actually my favorite stock out of all of them. So I'm surprised that he decreased it, I would have increased it. 

Because in my opinion, Microsoft has the best business of the bunch with dominance in so many markets like business software, with Office operating systems with Windows networking, with LinkedIn coding with GitHub gaming with Xbox, and of course cloud computing, artificial intelligence, and machine learning with Azure. 

They also have unbelievable financials with about $170 billion in sales, and over 60 billion in profits just last year alone, yet they are still somehow managing to grow sales by close to 20% this year, and another 14% next year as well. That is unbelievable. The dividend is tiny, at only about 1%. 

But it's got some excellent growth metrics on it. And because the stock is currently going through one of the rarest dips you'll ever see in it with a drop of close to 30%. I just think that the stock is worth owning for the long term even at today's prices. I admit I'm biased because I've always loved Microsoft stock but they got to take the number one spot for me.

But, my official ranking for Mr. Wonderful in the top 10 largest stocks goes as follows. Number one, we've got Microsoft number two apple and number three, we put Verizon number four, we've got Pfizer, number five, we've got Home Depot number six, we've got Lockheed Martin number seven, we've got j&j Number eight we've got Procter and Gamble number nine, we've got UnitedHealth. And number 10. We've got McDonald's.