Glenview Capital, led by Larry Robbins, has recently published its 13F filing with the SEC, disclosing an equity portfolio worth $25.25 billion. The largest stakes of Glenview Capital are concentrated in the health care sector and represent around 46% of the portfolio. Glenview Capital was founded in 2000 in New York City and since then is has grown in managed equity funds by more than 20 times. The investment style of the company is mostly tied to the category of “growth at a reasonable price” equities and focuses on companies in industries that are stable, predictable and steady, with recurring revenue streams or entrenched market positions. Among the top picks of the fund one can find Thermo Fisher Scientific Inc (NYSE:TMO), AbbVie Inc (NYSE:ABBV), and Tenet Healthcare Corp (NYSE:THC). In this article we are going to take a closer look at how these companies performed over the past few months and consider how other money managers are trading them.
Professional investors like Robbins spend considerable time and money conducting due diligence on each company they invest in, which makes them the perfect investors to emulate. However, we also know that the returns of hedge funds on the whole have not been good for several years, underperforming the market. We analyzed the historical stock picks of these investors and our research revealed that the small-cap picks of these funds performed far better than their large-cap picks, which is where most of their money is invested and why their performances as a whole have been poor. Why pay fees to invest in both the best and worst ideas of a particular hedge fund when you can simply mimic the best ideas of the best fund managers on your own? A portfolio consisting of the 15 most popular small-cap stock picks among the funds we track has returned more than 118% and beaten the market by more than 60 percentage points since the end of August 2012 (see the details).
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During the second quarter Glenview Capital raised its stake in Thermo Fisher Scientific Inc (NYSE:TMO) by 34% to 9.26 million shares valued at $1.20 million. Thermo Fisher is a $53.84 billion American multinational provider of diagnostic and research instruments created in 2006 by the merger of Thermo Electron and Fisher Scientific. Its stock has gained 7% year-to-date and sports a dividend yield of 0.44%. For the second quarter, the company’s EPS of $1.84 and revenue of $4.27 billion, trumped the estimates by $0.06 and $100 million respectively. At the end of July, Leerink Swann boosted its target price for Thermo Fisher Scientific Inc (NYSE:TMO) to $149 from $141, reiterating ‘Outperform’ rating. At the end of June, Boykin Curry’s Eagle Capital Management held 4.43 million shares of Thermo Fisher Scientific Inc (NYSE:TMO) valued at some $575.05 million.
Glenview Capital also held around 17.86 million shares of AbbVie Inc (NYSE:ABBV) valued at $1.20 billion at the end of June. AbbVie Inc (NYSE:ABBV) is a global, research-based biopharmaceutical company. The company has been successfully increasing the dividends over the past 25 years and currently has a dividend yield of 2.96% dividend yield and a forward P/E ratio of 13.6. Furthermore, the mean estimations of analysts suggest around 12% of potential upside from the current price. Julian Baker and Felix Baker’s Baker Bros. Advisors is among the largest shareholders of AbbVie Inc (NYSE:ABBV) owning some 14.37 million shares valued at $965.76 million.
In Tenet Healthcare Corp (NYSE:THC), Glenview disclosed a $856.18 million stake, which contained 14.79 million shares, up by 7% on the quarter. However, last week, the investor reported the acquisition of 697,900 shares, which raised its holding to 15.49 million shares. Tenet is a multinational investor-owned healthcare services company based in Dallas, Texas. Its stock has inched up by 1% year-to-date, fueled by the recent Supreme Court decision in favor of the Affordable Care Act, which would keep subsidies intact and limit the risk of a spike of bad debt expenses of Tenet Healthcare. During the day of the ruling, the stock surged by 10%, but since then they have retreated to almost the same levels, offering investors a good buying opportunity. Among the other funds that we track, another shareholder of Tenet Healthcare Corp (NYSE:THC) is Israel Englander’s Millennium Management holding around 1.69 million shares worth $98.30 million.
Disclosure: None.
