Ask a Fool analyst: What are your top stock holdings heading into 2019?

Edward Sheldon looks at the top five holdings in his own portfolio.

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Quite often I get asked by friends what my top stock holdings are. They want to know which particular stocks I’m most bullish on. So today, I thought I’d take the opportunity to give Motley Fool readers a glimpse into my own portfolio and look at my top five holdings going into 2019. Here they are, ranked by position size.

Unilever

Unilever is currently my top holding. I haven’t owned the stock for that long, but I’ve been slowly building a stake in the company this year and I plan to keep increasing my position size when attractive opportunities arise. What do I like about Unilever? Well for starters, I like the consistency of the group’s revenues and profits. With an outstanding portfolio of well-known brands, it’s a ‘sleep-well-at-night’ type stock. Secondly, I like the group’s reach – it’s a truly global player, and it also has significant emerging markets exposure, which provides a growth story. Thirdly, it has an excellent dividend growth track record and the yield is healthy.

Legal & General

My second-largest holding is currently Legal & General. The main reason I like LGEN is that it’s a cash cow. Right now, its yield is over 7%, and I see that yield as sustainable in the medium term. I also like the fact that the company has a diversified business model (i.e. insurance, retirement solutions, and ETFs) which is based on a number of key global growth drivers.

Royal Dutch Shell

My next largest holding is Shell. One of the main reasons I own Shell is that I can rely on its dividends. The company hasn’t cut its divi since World War II, which shows that shareholders are a priority. Of course, the fact that the yield is a high 6.2% is another advantage. Like LGEN, it’s a cash cow.

DS Smith

My fourth-largest holding is packaging specialist DS Smith. The reason I’ve loaded up here is that I see the stock as a play on the online shopping boom. If you buy something online these days, it generally comes in a cardboard box, so I see a long-term growth story here. I also like the stock’s yield (currently over 5%) and the shares look great value at present, so I’ve added more to my portfolio recently.

Prudential

Finally, my fifth-largest holding is financial services firm Prudential. The key reason I’ve built up a solid position here is the firm’s exposure to Asia. There may be concerns over China/emerging market growth right now, but over the next few decades, I see the demand for financial products rising significantly across these regions. Given that PRU generates around 30% of its revenues from Asia, the firm looks well-placed to benefit. The company also has a good dividend growth track record.

So there you have it – my top five holdings right now. As you can see, there’s a strong focus on dividends, as I believe that they’re fundamental when it comes to generating long-term wealth from stocks. Of course, this is just a snapshot in time. My top five holdings could change in the near term as share prices fluctuate and I add to positions. Speaking of adding to positions, tomorrow I’ll be looking at five stocks I want to buy in 2019, so make sure you check out that article.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Edward Sheldon owns shares in Unilever, Legal & General, Royal Dutch Shell, DS Smith and Prudential. The Motley Fool UK owns shares of and has recommended Unilever. The Motley Fool UK has recommended DS Smith and Prudential. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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