10 Stocks That Fidelity Funds Are Buying

BOSTON ( TheStreet) -- The managers of Fidelity's biggest mutual funds have been cautious this year, judging from portfolio changes in the past few months. They mostly nibbled at stocks that the Boston-based fund firm already owns.

Fidelity's fund managers are known for sharing their best investment ideas with one another so it's not unusual for new buys, or sells, to ripple through portfolios company-wide, which can affect the markets. But, this year, it looks like most of the big guys are standing pat.

Fidelity manages 323 equity mutual funds with $635 billion in assets, making it one of the country's largest money managers.

To get an idea of its girth and potential market impact, Fidelity is the biggest shareholder of iPhone and iPad maker Apple ( AAPL), with 49 million shares at the end of 2011, or 5.3% of Apple's outstanding shares. That's about 1 percentage point more than the stake of the next-largest shareholder, Vanguard Group.

So a sampling of Fidelity's biggest funds' recent behavior can give a taste of what its market-moving funds are up to. In this exercise, I reviewed the top 100 stock holdings of five of the biggest, actively managed funds, four with quarterly changes through the end of February and the other, the Fidelity Low-Priced Stock Fund ( FLPSX), as of the end of January.

The Fidelity fund managers' largest purchases were additions to existing positions in software and services giant Microsoft ( MSFT) (the company now owns just over 1% of its shares), wireless chipmaker Qualcomm ( QCOM) (it's the second-largest shareholder, with 3.8% of its shares), and cable-TV operator and entertainment conglomerate Comcast ( CMCSA) (1.6% of its shares).

The $61 billion large-cap Fidelity Contrafund ( FCNTX ), up 14.4% this year, initiated two new positions: credit-card processor American Express ( AXP) and (new to this fund) Comcast, but those companies have been held by other funds within the Fidelity family off and on for some time.

The biggest additions in the top 25 holdings of the 414-stock portfolio were of banker Wells Fargo ( WFC), at 3.5 million shares, which makes it the seventh-biggest holding at 2% of the portfolio, and Qualcomm, with a purchase of 1.8 million shares. Qualcomm is now its 15th-largest holding at just over 15 million shares.

Fidelity also bought 5.5 million shares of Microsoft building its stake to 14.6 million shares and doubled down on U.S. Bancorp ( USB) with a stake that is now at just under 9 million shares.

Contrafund manager William Danoff soured on gold stocks this year, trimming stakes in Newcrest Mining ( NCM ), Goldcorp ( G) and Eldorado Gold ( GLD).

The fund also cut back its Gilead Sciences ( GILD) stake by almost 50%, although it still holds 7 million shares of the drug developer.

The $26 billion Low-Priced Stock Fund, with 931 stocks and up 11.6% this year, also made a big buy of Microsoft, adding 7.2 million shares to what was already the fund's second-largest position. It also bought 7.2 million shares of Staples ( SPLS), building its stake in the office-products chain to 22 million shares.

Fidelity is Staples' biggest shareholder, with just over 4% of its shares.

The $12 billion Fidelity Blue-Chip Growth Fund ( FBGRX), up 17.5% this year, had no new purchases among its top holdings, but added 2 million Microsoft shares to bring its stake to over 7 million, and picked up 46,000 shares of Qualcomm.

Other big purchases of Blue-Chip Growth, on a relative basis, was 1.4 million shares of data-storage firm Netapp ( NTAP), 1.4 million shares of Comcast, and 1.1 million shares of Ingersoll-Rand ( IR), to bring its stake in the industrial machinery maker to 1.7 million shares.

The $8 billion, 513-stock Fidelity Dividend Growth Fund ( FDGFX), up 13% this year, also bulked up on Microsoft, adding 1.1 million shares to a stake of 2.6 million and upped its holding in Ardea Biosciences ( RDEA) by about 60% to 1.1 million shares. It had no new positions in its top 100 holdings.

The $952 million Fidelity Large Cap Stock Fund ( FLCSX), up 12.8% this year, made no real significant portfolio changes in its top 100 holdings in the 222-stock portfolio.

The following is a synopsis of 10 of the companies that Fidelity funds have added recently, in inverse order of share-price return this year:

10. U.S. Bancorp ( USB)

Company profile: U.S. Bancorp, with a market value of $60 billion, is the fifth-largest bank, by assets in the U.S., with assets of $340 billion.

Dividend Yield: 2.49%

Investor takeaway: Its shares are up 15% this year and have a three-year, average annual return of 22%. Analysts give its shares seven "buy" ratings, six "buy/holds," 17 "holds," one "weak hold," and one "sell," according to a survey of analysts by S&P.

9. Staples ( SPLS)

Company profile: Staples, with a market value of $11 billion, is the leading operator of office-products superstores with about 2,300 units in the U.S. and internationally.

Dividend Yield: 2.74%

Investor takeaway: Its shares are up 15% this year and have a three-year, average annual loss of 7%. Analysts give its shares seven "buy" ratings, five "buy/holds," seven "holds," and two "weak holds," according to a survey of analysts by S&P.

8. NetApp ( NTAP)

Company profile: NetApp, with a market value of $16 billion, is a provider of storage hardware, software and services to a variety of enterprise customers.

Dividend Yield: N/A

Investor takeaway: Its shares are up 18% this year and have a three-year, average annual return of 36%. Analysts give its shares 12 "buy" ratings, six "buy/holds," 16 "holds," and one "weak hold," according to a survey of analysts by S&P.

7. Microsoft ( MSFT)

Company profile: Microsoft, with a market value of $255 billion, developed and sells the Windows PC operating system and the Office suite of productivity software, among other products. The company faces a challenge in the impending move to cloud computing by most users because Web-based applications will be managed there, a threat to the Windows PC operating system.

Dividend Yield: 2.57%

Investor takeaway: Its shares are up 20.5% this year and have a three-year, average annual return of 19%. Analysts give its shares 14 "buy" ratings, eight "buy/holds," and 13 "holds," according to a survey of analysts by S&P. Company-wide, Fidelity owns just over 1% of Microsoft's shares, making it the eighth-largest shareholder.

6. Wells Fargo ( WFC)

Company profile: Wells Fargo, with a market value of $278 billion, is a bank holding company that provides banking, insurance, investment, mortgage and consumer-finance services throughout North America.

Dividend Yield: 2.61%

Investor takeaway: Its shares are up 22% this year and have a three-year, average annual return of 21%. Analysts give its shares 14 "buy" ratings, nine "buy/holds," eight "holds," and one "sell," according to a survey of analysts by S&P.

5. Qualcomm ( QCOM)

Company profile: Qualcomm, with a market value of $113 billion, is a developer of products and services based on its advanced wireless broadband technology.

Dividend Yield: 1.49%

Investor takeaway: Its shares are up 22% this year and have a three-year, average annual return of 18%. Analysts give its shares 21 "buy" ratings, 16 "buy/holds," six "holds," one "weak hold," and one "sell," according to a survey of analysts by S&P.

4. American Express ( AXP)

Company profile: Amex, with a market value of $70 billion, is a giant in the credit card business. Because of its closed-loop network, Amex essentially owns the entire value chain and, as a result, retains the full economic value that's being created by its service.

Dividend Yield: 1.38%

Investor takeaway: Its shares are up 22% this year and have a three-year, average annual return of 47%. Analysts give its shares 11 "buy" ratings, four "buy/holds," 11 "holds," and two "weak holds," according to a survey of analysts by S&P.

3. Comcast ( CMCSA)

Company profile: Comcast, with a market value of $78 billion, merged with NBC Universal last year and the combination is a media and entertainment conglomerate that has diversified interests in cable, broadcasting, film and theme parks.

Dividend Yield: 2.22%

Investor takeaway: Its shares are up 24% this year and have a three-year, average annual return of 28%. Analysts give its shares 15 "buy" ratings, eight "buy/holds," and seven "holds," according to a survey of analysts by S&P.

2. Ardea Biosciences ( RDEA)

Company profile: Ardea, with a market value of $743 million, engages in the research and development of pharmaceutical products for the treatment of HIV, cancer and inflammatory diseases.

Dividend Yield: N/A

Investor takeaway: Its shares are up 26% this year and have a three-year, average annual return of 29%. Analysts give its shares 11 "buy" ratings, two "buy/holds," and two "holds," according to a survey of analysts by S&P.

1. Ingersoll-Rand ( IR)

Company profile: Ingersoll-Rand, with a market value of $13 billion, manufactures a wide range of industrial and commercial products for uses in climate control, industrial technology and security.

Dividend Yield: 1.56%

Investor takeaway: Its shares are up 32% this year and have a three-year, average annual return of 35%. Analysts give its shares nine "buy" ratings, three "buy/holds," and 12 "holds," according to a survey of analysts by S&P.

>>To see these stocks in action, visit the 10 Stocks That Fidelity Funds Are Buying portfolio on Stockpickr.
Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.

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