We recently published a list of Renaissance Technologies Portfolio: Top 10 Stock Picks. In this article, we are going to take a look at where Gilead Sciences, Inc. (NASDAQ:GILD) stands against other Renaissance Technologies portfolio’s top stock picks.
The American quant hedge fund Renaissance Technologies is known for using statistical and mathematical tools to drive its investment programs. It was founded in 1982 by Jim Simons, a mathematician who worked as a code breaker for the US National Security Agency during the Cold War. As of December 31, Renaissance Technologies had a portfolio valued at over $67.5 billion.
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Simons was among the pioneers of quantitative investing. He had an estimated net worth of $31.4 billion at the time of his death in May last year, making him the 51st richest person in the world at the time. His use of mathematical models and algorithms to drive long-term investment returns earned him a legacy that rivaled the likes of Warren Buffett and George Soros.
The Renaissance founder stepped down from active hedge fund management in 2010 and resigned as its executive chairman in 2021. The firm is now headed by Peter Brown, who has a strong educational background in mathematics and computer sciences. His father, Henry B.R. Brown invented the Reserve Primary Fund in 1970, the first money market fund to be established.
Brown is committed to using mathematical models to discover and unlock the value of stocks in the market. 2024 was a strong year for Renaissance Technologies. According to a report on Business Insider, the two funds that are open to investors—Renaissance Institutional Equities Fund (RIEF) and Renaissance Institutional Diversified Alpha (RIDA)—delivered double-digit returns of 22.7% and 15.6%, respectively.
Its signature Medallion fund performed even better, with a 30% gain, outperforming the broader market by nearly seven percentage points. Medallion was closed to outside investors in 1993 and has since then only been available to past and current employees, and their families. The fund generated average annual returns of 66% for three decades between 1988 and 2018, resulting in over $100 billion in profits during the period. This earned Medallion the reputation of being one of the most successful investment portfolios of all time.
On February 13, Renaissance Technologies filed a portfolio update, reflecting its holdings for the fourth quarter of 2024. The 13F SEC filings revealed significant changes in the portfolio, including a substantial reduction of stake in a leading technology conglomerate and increased investments in Asia-based artificial intelligence companies during the quarter.
Our Methodology:
We scanned Renaissance Technologies’ 13F portfolio, as of December 31, 2024. From there, we picked the top 10 stocks according to their stake value and ranked them in ascending order.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 363.5% since May 2014, beating its benchmark by 208 percentage points (see more details here).
A physician and a patient having a discussion in a hospital about biopharmaceutical medicines.
Gilead Sciences, Inc. (NASDAQ:GILD)
Stake Value as of Q4 2024: $492,308,361
Gilead Sciences, Inc. (NASDAQ:GILD) is a biopharmaceutical company engaged in the development of medicines to prevent and treat various life-threatening diseases, including HIV, viral hepatitis, and cancer. It is among the top stocks from the Renaissance Technologies portfolio, with the hedge fund having investments valued at over $492.3 million in the company.
On February 18, the company announced that the FDA had accepted its new drug application submission for its HIV prevention treatment, Lenacapavir, with a target action date of June 19, 2025, to review the applications. If approved, this would be the first-ever twice-yearly HIV prevention choice. Analysts expect the drug to reach peak annual sales of $3 billion to $4 billion.
During its Q4 2024 earnings call on February 11, Gilead Sciences, Inc. (NASDAQ:GILD) reported an 8% year-over-year growth in its base business product sales for 2024. Full-year revenue stood at $28.8 billion, up 6% from last year, driven by higher sales in HIV, liver disease, and oncology. Non-GAAP diluted EPS was logged at $4.62, down from $6.72 in 2023, due to an increase in income tax expense and higher acquired IPR&D expenses from the CymaBay acquisition.
In February last year, Gilead Sciences, Inc. (NASDAQ:GILD) expanded its liver portfolio with the $4.3 billion acquisition of CymaBay Therapeutics, Inc., a leading pharmaceutical company focused on treatments of patients with liver and other chronic diseases. The addition of Seladelpar to treat primary biliary cholangitis (PBC) complements the company’s existing liver portfolio and aligns with its quest to bring transformational medicines to patients.
Gilead Sciences, Inc. (NASDAQ:GILD) is committed to strong shareholder returns and recently declared a 2.6% increase in its quarterly cash dividend, beginning Q1 2025. Wall Street analysts are bullish on the stock, with a consensus Buy rating. Investor sentiment continues to improve as well. According to Insider Monkey’s database for Q4 2024, 74 hedge funds held a stake in the company, up from 59 at the end of the third quarter.
Overall, GILD ranks 10th on our list of Renaissance Technologies portfolio’s top stock picks. While we acknowledge the potential of software companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than GILD but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
