Editor’s Note: Related tickers: Aon PLC (NYSE:AON), Marsh & McLennan Companies, Inc. (NYSE:MMC), CVS Caremark Corporation (NYSE:CVS), Microsoft Corporation (NASDAQ:MSFT), Google Inc (NASDAQ:GOOG), Covidien plc (NYSE:COV), Thermo Fisher Scientific Inc. (NYSE:TMO)
Hedge funds are required to file 13F forms with the Securities and Exchange Commission after the end of each calendar quarter. One of the funds we track is First Pacific Advisors, managed by Robert Rodriguez and Steven Romick. We will review the five largest equity holdings of First Pacific, via its first quarter 13F. The original filing can be found here, and it’s important to note that piggybackers can have success if they know where to look; discover how to piggyback hedge funds here.
Let’s get started
The next largest holding listed in the 13F is CVS Caremark Corporation (NYSE:CVS), in which the fund has a $402.8 million stake. The fund’s stake is7,325,600 shares, an increase of 103,100 shares from the end of December. The prior value of the stake was about $349.2 million. CVS Caremark Corporation (NYSE:CVS) is trading at a forward P/E of 13.2x and has a year-to-date return of slightly below 13%. More than 30 hedge funds from our database held shares of CVS Caremark Corporation (NYSE:CVS) at the end of last year.
The best of the rest
Next up is Microsoft Corporation (NASDAQ:MSFT). The 13F states that the fund owns 12,961,300 shares of the company, worth $370.8 million. In the previous round of 13F filings, the fund held a stake of 12,425,100 shares worth $332.1 million. Microsoft Corporation (NASDAQ:MSFT) is held by 95 of the hedge funds we track. Among companies from the technology sector, Microsoft Corporation (NASDAQ:MSFT) has the second highest market cap, totaling $275.84 billion. Google Inc (NASDAQ:GOOG) holds the first position, with a market cap of $291.14 billion.
First Pacific has also disclosed owning 5,348,800 shares of Covidien plc (NYSE:COV), down from 5,399,500 shares held at the end of last year. The value of the equity stake advanced to $362.9 million, from $311.8 million. Covidien sharessport a year-to-date return of above 15%. According to our database, over 30 hedge funds were invested in Covidien plc (NYSE:COV) at the end of 2012. In the second quarter of its fiscal 2013, Covidien plc (NYSE:COV) reported diluted GAAP EPS from continuing operations of $0.93, versus $1.01 a year earlier.
The fund also holds 3,865,800 shares of Thermo Fisher Scientific Inc. (NYSE:TMO), worth $295.7 million. In the prior quarter the fund reported 3,720,600 shares, worth $237.3 million. The stock of Thermo Fisher Scientific Inc. (NYSE:TMO) has a forward P/E of 14.2x and a year-to-date return above 32.6%. In the previous round of 13F filings, 40 hedge funds from our database disclosed ownership in the company.
Final thoughts
First Pacific Advisors has revealed quite a diversified top five in this recent 13F. The hedge fund increased the value of its equity portfolio to $9.2 billion, from $8.3 billion heading into 2013.Continue preparing for 13F-filing season here.
In short, Thermo Fisher Scientific Inc. (NYSE:TMO) and Covidien plc (NYSE:COV) offer value plays in the bioscience/healthcare space, while Microsoft Corporation (NASDAQ:MSFT)’s attractiveness really lies in its ability to continue its momentum in the face of “PC death” fears. Aon PLC (NYSE:AON) and CVS Caremark Corporation (NYSE:CVS) are also solid investments that trade at undervalued multiples; we’d keep our eye on this five over the next quarter.
Disclosure: none
