Hedge Funds’ Favorite Medical Care Stocks

#3 Universal Health Services, Inc. (NYSE:UHS)

 – Investors with long positions (as of March 31): 38

– Aggregate value of investors’ holdings (as of March 31): $1.09 billion

Moving on, hedge funds covered by us long Universal Health Services, Inc. (NYSE:UHS) increased by two and the aggregate value of their holdings in the company jumped by $148 million during the first quarter. Billionaire Cliff Asness‘ AQR Capital Management was among the funds that increased its stake in the company during that period, by 19% to 1.04 million shares. Aided by the strong quarterly numbers the company reported recently, Universal Health Services, Inc. (NYSE:UHS)’s stock is currently trading with gains of 12.8% in 2016. While analysts had expected the company to report $1.87 on revenue of $2.41 billion, Universal Health Services declared EPS of $1.98 on revenue of $2.62 billion for the first quarter. Following the earnings release, on May 28, analysts at Mizuho reiterated their ‘Buy’ rating on the stock while upping their price target on it to $150 from $140.

#2 HCA Holdings Inc (NYSE:HCA)

– Investors with long positions (as of March 31): 68

– Aggregate value of investors’ holdings (as of March 31): $4.29 billion

In terms of the number of the number of hedge funds covered by us with ownership in a company, HCA Holdings Inc (NYSE:HCA)  was the top medical care stock at the end of first quarter. During that period, the ownership of the company among funds covered by us inched up by one and the aggregate value of their holdings in the company jumped up by $471 million. Shares of the largest hospital chain operator (by revenue) in the country have appreciated by around 17% so far this year, but are still trading down 18.16% from their lifetime high of $95.49, which they made last year. On May 3, HCA Holdings Inc (NYSE:HCA) reported its fiscal 2016 first quarter earnings, declaring EPS of $1.71 on revenue of $10.26 billion versus analysts’ projection of EPS of $1.49 on revenue of $10.24 billion. Richard Perry‘s Perry Capital reduced its stake in HCA Holdings Inc by 10% to 2.77 million shares during the first quarter.

#1 DaVita HealthCare Partners Inc (NYSE:DVA)

– Investors with long positions (as of March 31): 37

– Aggregate value of investors’ holdings (as of March 31): $4.3 billion

Though the ownership of DaVita HealthCare Partners Inc (NYSE:DVA) among funds covered by us came down by one during the first quarter, the aggregate value of their holdings in the company went up by $270 million during the same period. The 37 funds covered by us that reported owning a stake in the company, accounted for 28.40% of its float the end of first quarter. However, a major chunk of that float was owned by only one hedge fund – Warren Buffett‘s Berkshire Hathaway. At the end of first quarter, Berkshire Hathaway continued to own 38.56 million or nearly 10% of all outstanding shares of DaVita HealthCare Partners Inc (NYSE:DVA). Shares of the kidney care services provider are currently trading up over 9% year-to-date, but most analysts feel that it will be hard for it to appreciate further. The stock currently sports an average rating of ‘Hold’ and an average price target of $78.10 from the 14 leading analysts on the Street who track it.

Disclosure: None