The Gates Portfolio: A Cartography of Value

by

It is written in the Libro de los Fundamentos, a text of dubious provenance attributed to the cartographer Ulric Nebenzahl, that wealth, when sufficiently concentrated, begins to resemble not a sum, but a singularity. The estate of William Gates, once a titan of the digital realm, now operates as a peculiar kind of archive, a repository not of data, but of capital, meticulously allocated. We observe, through the fractured lens of quarterly reports, a portfolio not merely diversified, but condensed – a reduction of the infinite possibilities of the market into a handful of chosen emblems.

The Gates Foundation, a labyrinthine structure dedicated to ameliorating the world’s afflictions, does not, as one might expect, scatter its resources like seeds upon the wind. Rather, it concentrates them, as a scholar might collect fragments of a lost text, seeking to reconstruct a coherent narrative. Approximately 59% of its marketable equities—a figure that invites contemplation—are held in but three concerns. This is not a strategy of hedging against risk, but a deliberate embrace of a limited, yet carefully chosen, universe.

Berkshire Hathaway: The Mirror and the Maze

First, there is Berkshire Hathaway, an entity that defies easy categorization. It is, simultaneously, an insurance company, a holding company, and a reflection of its founder, Warren Buffett. The annual donation of shares by Buffett to the Gates Foundation is not an act of charity, but a continuation of a long-standing intellectual game, a mirroring of fortunes across the vast expanse of the market. Last year’s contribution—9.4 million Class B shares—is but one iteration in an endless recursion. The Foundation holds 21.8 million shares, worth approximately $11 billion—a sum that feels less like a quantity and more like a coordinate in a higher-dimensional space.

The transition of leadership to Greg Abel is, in the grand scheme of things, irrelevant. The underlying structure, the network of businesses, the accumulation of capital—these are the enduring realities. Abel, like a new librarian inheriting a vast collection, will merely catalog and maintain, not fundamentally alter, the existing order. The valuation—1.55 times book value—is a matter of convention, a human attempt to impose order on a chaotic system. The true value, like the ultimate meaning of a dream, remains elusive.

WM: The Repository of Discard

Next, we have WM, formerly Waste Management, a company that deals in the inevitable detritus of human existence. It is a paradox that the Foundation, dedicated to alleviating suffering, should invest in a company that profits from waste. Yet, there is a strange logic to this. WM controls a vast portfolio of landfills—260 locations—which function as a kind of archive of our discarded desires. It is a closed system, immune to competition, a self-contained universe of refuse. The 28.9 million shares held by the Foundation—worth $6.6 billion—represent not merely an investment, but a recognition of the inescapable reality of entropy.

The company’s adjusted operating margin of 31.5%—a figure that borders on the uncanny—suggests a level of efficiency that is almost unnatural. The integration of Stericycle—renamed WM Healthcare Solutions—is a further consolidation of power, a tightening of the grip on the flow of waste. The company’s disappointing 2026 outlook is merely a temporary fluctuation, a ripple in the otherwise placid surface of the market.

Canadian National Railway: The Lines of Convergence

Finally, there is Canadian National Railway, a network of tracks that crisscrosses the continent, connecting disparate points in a web of commerce. The 44.6 million shares received from Gates’ personal portfolio in 2022—now worth $5.1 billion—represent a recognition of the fundamental importance of infrastructure. The railway is a line of convergence, a conduit for the flow of goods and resources. It is a physical manifestation of the interconnectedness of the modern world.

The company’s flat revenue outlook for 2026 is merely a reflection of the inherent limitations of the physical world. The share repurchase program—up to 24 million shares—is a symbolic gesture, a redistribution of wealth within a closed system. The enterprise value-to-EBITDA ratio of below 12 suggests a degree of undervaluation, a hidden potential waiting to be unlocked.

The lesson, if one can be drawn from this cartography of value, is not that owning a small number of companies is inherently superior to owning many. It is that the selection of those companies—the choice of which universes to inhabit—is paramount. The Gates Foundation, like a meticulous collector, has chosen wisely, creating a portfolio that is not merely profitable, but profoundly symbolic. It is a reflection of the world as it is, and a subtle suggestion of the world as it might be.

Read More

2026-02-08 19:53