Akre Capital’s 26 Stock Portfolio: Top 10 Holdings Analyzed

Founded in 1989, Akre Capital Management is an asset management firm located in Middleburg, Virginia, with about $15.9 billion in private funds, mutual funds, and separately managed account assets. Chuck Akre Jr., the founder, managing member, CEO, and CIO, is still at the firm’s helm, having delivered exceptional returns to his clients over the years.

Investors following the company’s 13F filings over the last three years (from mid-February 2018 through mid-February 2021) would have generated annualized total returns of 19.96%. For comparison, the S&P 500 ETF (SPY) generated annualized total returns of 12.50% over the same time period.

Akre Capital Management’s Investment Strategy & Philosophy

Chuck Akre describes the essence of the company’s investment approach as a “three-legged stool." This metaphoric three-legged stool represents what he and his colleagues are looking for in a potential investment. That is:

  1. An extraordinary business.
  2. Talented management.
  3. Great reinvestment opportunities and histories.

The company believes it differentiates itself from other fund managers in two main ways. The first is that Akre is looking to compound the capital it manages once it has identified that investing in these “extraordinary” businesses, as it defines them, is the best way to achieve its goal. The company is only thinking of selling shares when one or more of its legs of its stool is “broken or injured." Hence, the fund is not looking to trade or sell its shares based on price movement alone.

The second is that Akre likes to take the opportunity to exploit Wall St.’s obsession with quarterly misses and buy companies that trade at very attractive valuations based on their book value during the Street’s “penny-misses” selloffs.

These principles have remained true and have helped Akre and his team’s investments lead to superior returns. This is not only visible in our calculated 13F returns but also in the company’s mutual fund, which is publicly traded under the ticker (AKREX). Investors looking to let their funds compound under Mr. Akre’s long-term tested and superior leadership are better off investing in this fund instead of trying to copy the 13F’s individual holdings.

Source: Google Finance 

Akre Capital Management’s Portfolio & 10 Largest Public Equity Investments

Akre Capital Management’s public-equity holdings consist of 26 individual equities, mostly allocated in the Telecommunications, Industrial, Financials, and Consumer Discretionary sectors.

Source: Author, Company Filings

The portfolio is fairly diversified, with no stock exceeding 15% of its total weight, though the first 10 holdings do comprise around 77% of it. The fund made almost no changes from its previous quarter’s holdings.

Source: Author, Company Filings

Mastercard Incorporated (MA)

Akre’s largest holding is one-half of the dominating global payment processors duo. Along with Visa (V), they have been dominating the space. Benefiting from what is essentially a duopoly, Mastercard has been delivering exceptional returns for years as the company has been tapping fully into the going-cashless trend.

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Disclosure: Sure Dividend is published as an information service. It includes opinions as to buying, selling and holding various stocks and other securities.

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