How Hedge Funds Are Positioned in Long-Term Care Providers

#3 Kindred Healthcare, Inc. (NYSE:KND)

– Investors with long positions (as of March 31): 24

– Aggregate value of investors’ holdings (as of March 31): $252.65 million

Apart from Press Ganey Holdings Inc, Kindred Healthcare, Inc. (NYSE:KND) is the only stock in this list that is trading in the green for 2016, albeit marginally by only 2.19%. The number of hedge funds covered by us with long positions in Kindred Healthcare, Inc. (NYSE:KND) remained unchanged during the first quarter, however, the aggregate value of their holdings in the company suffered a drop of almost 20% during the same period. Kindred Healthcare’s stock suffered a significant loss last month after a federal judge deemed the act of spending money to reimburse health insurers by the Obama administration as unconstitutional on May 12. Following better-than-expected first quarter numbers released by the company on May 5, analysts at Mizuho reiterated their ‘Neutral’ rating on the stock, but upped their price target to $13.50 from $9. Clint Carlson‘s Carlson Capital brought down its holding in Kindred Healthcare by 11% to 4.2 million shares during the first quarter.

#2 Envision Healthcare Holdings Inc (NYSE:EVHC)

– Investors with long positions (as of March 31): 32

– Aggregate value of investors’ holdings (as of March 31): $835.4 million

Moving on, Envision Healthcare Holdings Inc (NYSE:EVHC) was another stock whose ownership among funds covered by us remained unchanged, but the aggregate value of their holdings in it dropped during the first quarter, by $206 million. Funds that reduced their stake in Envision Healthcare Holdings Inc (NYSE:EVHC) during the first quarter included billionaire Andreas Halvorsen‘s Viking Global, which brought its holding down by 35% to 5.12 million shares. Though the shares of Envision Healthcare Holdings have gained around 6.50% so far in 2016, they have lost around 40% of their value since August last year, when they reached their lifetime high of $45.95. The 19 leading analysts on Wall Street who track the stock, currently have a consensus ‘Buy’ rating and an average price target of $31 on it, which represents a potential upside of around 25% from the stock’s current trading price.

#1 Brookdale Senior Living, Inc. (NYSE:BKD)

– Investors with long positions (as of March 31):  45

– Aggregate value of investors’ holdings (as of March 31): $1.15 billion

Despite the number of hedge funds covered by us with long positions in the company coming down by 12 and the aggregate value of their holdings in it dropping by $360 million during the first quarter, Brookdale Senior Living, Inc. (NYSE:BKD) continued to remain the most popular long-term care facility stock among funds we track at the end of that period. One of the main reasons behind the company losing its appeal to large investors has been its consistently declining stock price. After losing almost half of its market capitalization last year, Brookdale Senior Living, Inc. (NYSE:BKD)’s continued its downward trajectory in the first quarter of this year and even though it has recovered somewhat from those declines it is still trading down by 9.5% year-to-date. This decline in the stock has led several analysts to reduce their price target on the stock, including analysts at Barclays, who on June 1, lowered it to $21 from $28 while keeping their rating on the stock unchanged at ‘Equal Weight’. Clifford Fox’s‘ Columbus Circle Investors was one of the hedge funds that sold its entire stake in Brookdale Senior Living during the January-March period.

Disclosure: None