Goldman Sachs’ List Of Stocks That Hedge & Mutual Funds Love & Hate: 28 Stocks On The Mutual and Hedge Funds Radar

23. Cencora (NYSE:COR)

Number of Hedge Fund Holders In Q2 2024: 47

Category: Shorted by HFs and overweight among mutual funds

Cencora (NYSE:COR) is one of the biggest pharmacy distributors in America. Its heft is evident by the fact that the firm’s trailing twelve month revenue sits at $283 billion while it ended its latest quarter with cash and equivalents of $3.3 billion. Cencora (NYSE:COR)’s business model means that it is reliant to a large extent on some of the biggest pharmacy chains in America for its business. Its contracts expire annually, and Cencora (NYSE:COR) is also dependent on the state of the US pharmacy industry as well as new drugs entering the market and patent expiration leading to generics. As an example, Cencora (NYSE:COR)’s shares fell by 6% in May after a weight loss drug shortage meant that it was deprived of high volumes that are necessary to drive margins. Conversely, the shares jumped by 7% in July after the firm bumped its adjusted 2024 EPS guidance to a midpoint of $13.60 from an earlier $13.45 on the back of rising specialty drug and biosimiliar sales. Therein also lie the key drivers of Cencora (NYSE:COR)’s stock.

Cencora (NYSE:COR)’s management commented on the specialty and biosimilar markets during the Q3 2024 earnings call:

“I am particularly proud of our specialty distribution and services offering. For close to three decades, we have been a leader and innovator in this space. Importantly, we continue to make forward-thinking investments that position us to capitalize on addressing the complexities these products pose in handling and distribution, and connect us with downstream providers where we are positioned to equip practices with offerings that advance the strength of their business.

As specialty continues to grow across all therapeutic areas, we are able to expand and develop the partnerships we have with customers, furthering our leading market position. Our leadership in specialty remains a key tenant of our long-term growth and strategy. We make forward-thinking investments in our infrastructure and emerging technologies to position Cencora as the best partner to address our customers’ current and future needs.”