GMO Q1 2026: Grantham's Quality Megacap Book

Grantham, Mayo, Van Otterloo & Co. — the Boston firm known as GMO and for co-founder Jeremy Grantham's bubble warnings — reported a $39.10B U.S. equity book for the quarter ended March 31, 2026 (Form 13F-HR, accession 0001072613-26-000397, filed 2026-05-14). The book sat essentially flat in value on the quarter, but its composition tells a more nuanced story than GMO's famously cautious commentary might suggest: the portfolio is anchored by high-quality megacaps and healthcare defensives, and the firm actually added to Microsoft (MSFT), raising it 17% to the top holding.

This is the through-line of a quality strategy. GMO's flagship discipline screens for high-profitability, low-debt businesses, and its largest positions reflect that: Microsoft, Alphabet, Johnson & Johnson (JNJ), Apple (AAPL), and Meta (META). These are megacaps, but they are also among the most profitable companies in the market — exactly the kind of quality GMO favors even when it is wary of valuations broadly.

The main active reduction was a 26% trim of semiconductor-equipment maker Lam Research (LRCX), a more cyclical name than the quality compounders it kept.

Quality megacaps plus healthcare defensives

Microsoft leads at 5.86%, followed by Alphabet's GOOGL shares at 5.08%, Johnson & Johnson at 4.56%, Apple at 4.51%, and Meta at 4.50%. The blend is telling: alongside the megacap-tech leaders sit defensive, high-quality names like J&J, Thermo Fisher (TMO) in healthcare, and U.S. Bancorp (USB).

The ten largest positions account for roughly 40% of the book, with the rest spread across a long tail. The mix of profitable megacaps and steady healthcare and financial names is a recognizably quality-tilted portfolio rather than a pure growth or pure value book.

The quarter's moves

The clearest active decisions were the 17% increase in Microsoft and the 26% trim of Lam Research, with smaller adds to Meta (+6%) and Broadcom (AVGO, +7%). Most other top positions — Alphabet, J&J, Apple, Thermo Fisher, U.S. Bancorp — were held roughly flat.

Adding to Microsoft while trimming a more cyclical chip-equipment name fits a quality manager's instinct to favor durable, cash-generative franchises over names tied to the semiconductor capital-spending cycle. It is a subtle tilt toward stability within an already quality-oriented book.

A steadily grown book

GMO's reported 13F value climbed steadily from around $30B in late 2024 to $39.10B in Q1 2026, then held flat on the latest quarter.

The smooth trajectory and flat latest quarter are consistent with a disciplined manager whose book reflects steady positioning rather than dramatic swings. The Microsoft add and Lam Research trim are the signals that give the quarter its character. Track the firm's quarter-over-quarter holdings on the GMO filer page.

FAQ

What is GMO (Grantham, Mayo, Van Otterloo)?

GMO is a Boston-based asset manager known for its quality and value disciplines and for co-founder Jeremy Grantham. It reported a $39.10B U.S. equity 13F book for the quarter ended March 31, 2026.

What are GMO's largest holdings in Q1 2026?

Its five largest positions are Microsoft (5.86%), Alphabet's GOOGL shares (5.08%), Johnson & Johnson (4.56%), Apple (4.51%), and Meta (4.50%) — a mix of quality megacaps and defensives.

What did GMO buy and sell in Q1 2026?

GMO raised Microsoft by 17% to its top holding and added to Meta and Broadcom, while trimming semiconductor-equipment maker Lam Research by 26%.

Does GMO's 13F match its cautious reputation?

The book leans on high-quality megacaps and healthcare defensives rather than avoiding stocks entirely — consistent with GMO's quality discipline, which favors profitable, low-debt businesses even amid broad valuation caution.