Here is What Hedge Funds Think About Bristol Myers Squibb Co. (BMY)

You probably know from experience that there is not as much information on small-cap companies as there is on large companies. Of course, this makes it really hard and difficult for individual investors to make proper and accurate analysis of certain small-cap companies. However, well-known and successful hedge fund investors like Carl Icahn and George Soros hold the necessary resources and abilities to conduct an extensive stock analysis on small-cap stocks, which enable them to make millions of dollars by identifying potential winners within the small-cap galaxy of stocks. This represents the main reason why Insider Monkey takes notice of the hedge fund activity in these overlooked stocks.

Bristol Myers Squibb Co. (NYSE:BMY) was in 62 hedge funds’ portfolios at the end of the third quarter of 2015. BMY investors should be aware of an increase in activity from the world’s largest hedge funds lately. There were 48 hedge funds in our database with BMY positions at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity, but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as China Life Insurance Company Ltd. (ADR) (NYSE:LFC), Medtronic, Inc. (NYSE:MDT), and McDonald’s Corporation (NYSE:MCD) to gather more data points.

In today’s marketplace there are dozens of metrics investors use to value their stock investments. Two of the less known metrics are hedge fund and insider trading indicators. We have shown that, historically, those who follow the best picks of the elite hedge fund managers can outclass the broader indices by a superb margin (see the details here).

Now, we’re going to view the recent action encompassing Bristol Myers Squibb Co. (NYSE:BMY).

What does the smart money think about Bristol Myers Squibb Co. (NYSE:BMY)?

Heading into Q4, a total of 62 of the hedge funds tracked by Insider Monkey were bullish on this stock, an increase of 29% from the second quarter. With hedgies’ sentiment swirling, there exists a few noteworthy hedge fund managers who were boosting their holdings substantially (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Samuel Isaly’s OrbiMed Advisors has the most valuable position in Bristol Myers Squibb Co. (NYSE:BMY), worth close to $513.2 million, corresponding to 5.2% of its total 13F portfolio. The second most bullish fund manager is Ken Griffin of Citadel Investment Group, with a $417.5 million position; the fund has 0.4% of its 13F portfolio invested in the stock. Other peers that are bullish contain Phill Gross and Robert Atchinson’s Adage Capital Management, Clifford Fox’s Columbus Circle Investors and Christopher James’s Partner Fund Management.

As aggregate interest increased, key hedge funds were breaking ground themselves. Balyasny Asset Management, managed by Dmitry Balyasny, initiated the biggest position in Bristol Myers Squibb Co. (NYSE:BMY). The fund had $72.1 million invested in the company at the end of the quarter. John Burbank’s Passport Capital also initiated a $23.8 million position during the quarter. The other funds with brand new BMY positions are Sanford J. Colen’s Apex Capital and Ken Greenberg and David Kim’s Ghost Tree Capital.

Let’s go over hedge fund activity in other stocks similar to Bristol Myers Squibb Co. (NYSE:BMY). We will take a look at China Life Insurance Company Ltd. (ADR) (NYSE:LFC), Medtronic, Inc. (NYSE:MDT), McDonald’s Corporation (NYSE:MCD), and Eli Lilly & Co. (NYSE:LLY). This group of stocks’ market caps are closest to BMY’s market cap.

As you can see these stocks had an average of 47 hedge funds with bullish positions and the average amount invested in these stocks was $2.64 billion. That figure was $2.53 billion in BMY’s case. McDonald’s Corporation (NYSE:MCD) is the most popular stock in this table, while China Life Insurance Company Ltd. (ADR) (NYSE:LFC) is at the other end of the specter with only 9 bullish hedge fund positions. Bristol Myers Squibb Co. (NYSE:BMY) is not the most popular stock in this group, but hedge fund interest is still above average. Although this is a slightly positive signal, we’d rather spend our time researching stocks that hedge funds are piling on. In this regard MCD might be a better candidate to consider a long position.