Cryder Capital Boosts Bets On Alphabet (GOOG), Credit Cards, Health Stocks

Ferdinand Groos‘ Cryder Capital Partners LLP is a London-based investment firm founded in 2011. The fund invests almost exclusively in technology and healthcare stocks, and had a 13F portfolio valued at $170.62 million on September 30, up from just $124.64 million on June 30. 45% of that value was invested in health stocks, with 42% being invested in the tech sector.

Given the jump in 13F portfolio value, it’s unsurprising that Cryder Capital boosted its holdings in various stocks during the September quarter. We’ll take a look at those moves in this article, which include Alphabet Inc. (NASDAQ:GOOG), Mastercard Inc (NYSE:MA), Visa Inc. (NYSE:V), Thermo Fisher Scientific Inc. (NYSE:TMO), and HCA Holdings Inc (NYSE:HCA).

We follow over 700 hedge funds and other institutional investors and by analyzing their quarterly 13F filings, we identify stocks that they are collectively bullish on and develop investment strategies based on this data. One strategy that outperformed the market over the last year involves selecting the 100 best-performing funds and identifying the 30 mid-cap stocks that they are collectively the most bullish on. Over the past year, this strategy generated returns of 18%, topping the 8% gain registered by S&P 500 ETFs.

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Cryder Capital had positions in both classes of Alphabet Inc. (NASDAQ:GOOG)‘s stock on September 30. During the quarter ended September 30, the investment fund boosted its holding in the company’s class C shares by 20% to 13,859 shares, while also lifting its holding in the company’s class A shares by 20%, to 16,460. Alphabet is the most popular stock among the funds in our database as of September 30, with 200 unique funds being long one or both classes of the company’s shares. Alphabet was recently named one of the top 10 stocks for 2017 by Barron’s, along with Apple, Disney, Merck, and others.

Cryder Capital also boosted its holding in Mastercard Inc (NYSE:MA) by 20% to 125,668 shares during the September quarter. The fund held $12.79 million worth of Mastercard’s stock at the end of the quarter, with the position accounting for 7.50% of the value of its 13F portfolio. Among the funds we track, 84 funds held $7.48 billion worth of Mastercard’s stock in aggregate at the end of September. Mastercard just announced that it will raise its quarterly dividend payment by 16% to $0.22, which will push its yield closer to 1%. The company has also authorized the repurchase of up to $4 billion worth of shares.

We’ll check out three more of the fund’s stock picks on the next page.

Cryder Capital also has 7.50% of its 13F portfolio value invested in Mastercard’s rival Visa Inc. (NYSE:V). The fund holds 154,638 shares of the company valued at $12.79 million at the end of September. While Cryder appears to value the two credit card rivals evenly, Barron’s recently pointed to Visa as being the more attractive of the duo in terms of valuation, with double-digit growth potential. The hedge funds in our system appear to agree with Barron’s, as 115 of them were long Visa on September 30, a total of 31 more than were long Mastercard.

Cryder Capital boosted its Thermo Fisher Scientific Inc. (NYSE:TMO) holding by 31% during the September quarter, to 164,704 shares valued at $26.20 million. The company recently updated its earning guidance for its fiscal year 2016, with it expecting its full-year EPS to be in the range of $8.19 to $8.30, up from the previous guidance range of $8.07 to $8.20. Thermo Fisher expects its robust acquisition strategy to be its main growth driver. The company maintained its revenue guidance for the fiscal year. 46 hedge funds in our database have long positions in Thermo Fisher Scientific as of September 30, down from 57 a quarter earlier. James Dondero‘s Highland Capital was one of the funds to sell off the stock in Q3, unloading all 27,300 shares of it which the fund had owned on June 30.

Lastly is HCA Holdings Inc (NYSE:HCA), in which Cryder buffed its position by 32% during the September quarter, ending the period with 314,531 shares worth $23.78 million. Following the surprise Presidential victory of Donald Trump, the stock saw a steep decline, as HCA Holdings is a healthcare provider which benefits from Obamacare, which could be dismantled under the Trump regime. Some hedge funds appear to have been fearful of a Trump win in Q3, as the number of funds in our system long HCA declined to 62 as of September 30 from 72 on June 30. Shares of HCA are down by over 10% since Trump’s win, but are still 5% in the green in 2016.

Disclosure: None