In this article, we present the list of the 5 biotech stocks hedge funds are talking about. You can read our analysis of the biotech industry and see some more related stocks by clicking 10 Biotech Stocks Hedge Funds Are Talking About.
5. Bristol-Myers Squibb Company (NYSE:BMY)
Number of Hedge Fund Holders: 66
Wedgewood Partners recently released its Q4 2020 Investor Letter, a copy of which you can download here. The Fund returned 12.2% for the fourth quarter of 2020. Meanwhile, the benchmark S&P 500 Index and the Russell 1000 Growth Index gained 12.2% and 11.4%, respectively. You should check out Wedgewood Partners’ top 5 stock picks for investors to buy right now, which could be the biggest winners of 2021.
In the Q4 2020 Investor Letter, Wedgewood Partners highlighted a few stocks and Bristol Myers Squibb Co (NYSE:BMY) is one of them. Bristol Myers Squibb Co (NYSE:BMY) is a pharmaceutical company. In the last twelve months, Bristol Myers Squibb Co (NYSE:BMY) stock gained 13.54% and on March 7, 2022, it had a closing price of $68.77. Here is what Wedgewood Partners said:
“Bristol-Myers Squibb recently reported accelerating sales as much of the medical services industry returned to work. The Company continues to expect double-digit earnings growth over the next few years, driven by existing drugs, in addition to a broad pipeline of new drugs and indications. While the market remains fixated on a couple of patent expirations that could occur over the next several years, we think this is well-known at this point, yet the market still undervalues a couple of key acquisitions the Company has made in the past few years, particularly Celgene, which was acquired for a song.”
4. Merck & Co., Inc. (NYSE:MRK)
Number of Hedge Fund Holders: 80
Miller Howard Investments, an investment management firm, published its third-quarter 2021 investor letter – a copy of which can be downloaded here. A quarterly return of 3.5% (yield) was recorded by the fund for the third quarter of 2021, compared to the 1.5% for the S&P 500 for the same period. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.
Miller Howard Investments, in its Q3 2021 investor letter, mentioned Merck & Co., Inc. (NYSE: MRK) and discussed its stance on the firm. Merck & Co., Inc. is a Kenilworth, New Jersey-based pharmaceutical company with a $196.4 billion market capitalization. MRK delivered a 1.42% return since the beginning of the year, while its 12-month returns are up by 9.96%. The stock closed at $77.73 per share on March 7, 2022.
Here is what Miller Howard Investments has to say about Merck & Co., Inc. in its Q3 2021 investor letter:
“While optimistic about a recovery, we continue to balance our cyclical holdings with dividend-payers in stable, less economically-sensitive industries. We hold three pharmaceutical companies, (which includes) Merck (MRK). All three have strong cash flows and balance sheets, making their high dividends reasonably safe. The investment controversy surrounding these pharma companies is whether they can develop or acquire new products to replace their current blockbuster drugs. The low valuations on these stocks reflects what we believe to be undue pessimism by investors on the prospects for new drugs.”
3. Pfizer Inc. (NYSE:PFE)
Number of Hedge Fund Holders: 83
Saturna Capital, an investment management firm, published its “Amana Funds” third-quarter 2021 investor letter – a copy of which can be downloaded here. For the third quarter of 2021, the Amana Income Fund Investor Shares returned -2.54% and the Institutional Shares returned -2.50%. The Amana Growth Fund Investor Shares returned 0.95%, ahead of the 0.58% return of the S&P 500 Index, as well as the NASDAQ Composite return of -0.22% for the same period. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.
Saturna Capital Amana Funds, in its Q3 2021 investor letter, mentioned Pfizer Inc. (NYSE: PFE) and discussed its stance on the firm. Pfizer Inc. (NYSE:PFE) is a New York, New York-based pharmaceutical industry company with a $269.8 billion market capitalization. PFE delivered a -18.75% return since the beginning of the year, while its 12-month returns are up by 39.27%. The stock closed at $47.98 per share on March 7, 2022.
Here is what Saturna Capital Amana Funds has to say about Pfizer Inc. in its Q3 2021 investor letter:
“The Fund’s strongest performer during the quarter was pharmaceutical manufacturer Pfizer. The company submitted trial data to the FDA for use of its COVID-19 vaccine for younger children, and it is widely expected that the FDA will approve it. Health authorities also began recommending booster shots of the Pfizer vaccine for select populations, further increasing demand for vaccinations.”
2. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 83
Distillate Capital, an investment management firm, published its second-quarter 2021 investor letter – a copy of which can be downloaded here. Distillate Capital’s U.S. and International Fundamental Stability & Value strategies gained 5.73% and 4.48% on a total return basis for the quarter, respectively. The U.S. portfolio lagged its S&P 500 benchmark by around 2.8% in the quarter, which offset most of the relative gain from the first quarter such that the first-half performance of the strategy is now 10 basis points ahead of that benchmark. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.
In the Q2 2021 investor letter of Distillate Capital, the fund mentioned Johnson & Johnson (NYSE: JNJ) and discussed its stance on the firm. Johnson & Johnson is a New Brunswick, New Jersey-based medical device company with a $452.7 billion market capitalization. JNJ delivered a 0.67% return since the beginning of the year, extending its 12-month returns to 9.20%. The stock closed at $172.21 per share on March 7, 2022.
Here is what Distillate Capital has to say about Johnson & Johnson in its Q2 2021 investor letter:
“The largest additions in the rebalance, Johnson & Johnson was around 50 and 40 basis points incrementally. J&J underperformed in the quarter while its normalized free cash flows held steady and so its position size was topped off to match the stable cash flows.”
1. Thermo Fisher Scientific Inc. (NYSE:TMO)
Number of Hedge Fund Holders: 95
L1 Capital, an investment management firm, published its ‘L1 Capital International Fund’ third quarter 2021 investor letter – a copy of which can be downloaded here. A quarterly net return of 3.7% was recorded by the fund in the second quarter of 2021, compared to the benchmark return of 3.9% You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.
L1 Capital, in its Q3 2021 investor letter, mentioned Thermo Fisher Scientific Inc. (NYSE: TMO) and discussed its stance on the firm. Thermo Fisher Scientific Inc. is a Waltham, Massachusetts-based scientific instrumentation, reagents and consumables, and software services provisioner with a $209.1 billion market capitalization. TMO delivered a -19.86% return since the beginning of the year, while its 12-month returns are up by 19.33%. The stock closed at $534.75 per share on March 7, 2022.
Here is what L1 Capital has to say about Thermo Fisher Scientific Inc. in its Q3 2021 investor letter:
“Included in these adjustments, in early July 2021, we divested our remaining small investment in Thermo Fisher Scientific (Thermo Fisher), the world leader in the provision of equipment, consumables, and services to the Life Sciences industry. Thermo Fisher has benefited from elevated demand for its products and services associated with COVID-19 and we sold our residual investment at a gain of more than 70% compared to our average investment cost. Thermo Fisher subsequently held an Investor Day and positively surprised many people, including us, with very strong medium-term growth targets, notwithstanding a headwind from normalisation of COVID-19-related business. Thermo Fisher is a high-quality business and remains on our ‘Bench’ for potential reinvestment.”
You can also take a peek at the 10 Cryptocurrencies to Watch Amid Russia’s Attack on Ukraine and 10 Stocks to Buy Now According to Hari Hariharan’s NWI Management.
