Here’s How Billionaire Bill Ackman’s Top Picks Performed In the Fourth Quarter

#1 Valeant Pharmaceuticals Intl Inc (NYSE:VRX)

Shares held (as of September 30): 19.47 million
Total Value (as of September 30): $3.47 billion
Percent of Portfolio (as of September 30): 24.90%

With its stock falling from $178.38 at the end of September to $101.65 at the end of December, Valeant Pharmaceuticals Intl Inc (NYSE:VRX) was the worst performer in Ackman’s portfolio in the fourth quarter. Valeant’s troubles began on the back of price regulation concerns, and they became worse after Citron Research published a scathing report revealing Valeant’s questionable dealings with mail order pharmacy Philidor. Ackman nevertheless remains optimistic on the company, noting that other drug makers have had to pay large fines for questionable dealings also. He also considers that the stock’s decline increased the company’s intrinsic value, as Valeant conducted a series of small acquisitions.

“The result of these transactions and the related synergies increased our estimates for cash earnings to about $15.90 per share for 2016 and larger amounts in later years, substantially increasing our estimate of Valeant’s intrinsic value,” Ackman stated.

Therefore, Valeant does have a lot of inherent value, and many hedge funds outside of Pershing Square are also bullish on the stock. According to our data, 88 elite funds were long Valeant at the end of the third quarter, down from 98 funds at the end of the second quarter. Jeffrey Ubben’s ValueAct Capital owned 14.99 million shares at the end of September.

Disclosure: none