A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended December 31st, so let’s proceed with the discussion of the hedge fund sentiment on Abbott Laboratories (NYSE:ABT).
Is ABT stock a buy or sell? Abbott Laboratories (NYSE:ABT) investors should be aware of an increase in enthusiasm from smart money lately. Abbott Laboratories (NYSE:ABT) was in 64 hedge funds’ portfolios at the end of December. The all time high for this statistic is 67. Our calculations also showed that ABT isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).
So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017 (see the details here).
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. Recently Oregon became the first state to legalize psychedelic mushrooms which are shown to have promising results in treating depression, addiction, and PTSD in early stage academic studies. So, we are checking out this psychedelic drug stock idea right now. We go through lists like the 10 best biotech stocks to invest in to pick the next stock that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage (or at the end of this article). Keeping this in mind let’s review the recent hedge fund action regarding Abbott Laboratories (NYSE:ABT).
Do Hedge Funds Think ABT Is A Good Stock To Buy Now?
At the end of the fourth quarter, a total of 64 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 3% from the previous quarter. On the other hand, there were a total of 62 hedge funds with a bullish position in ABT a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, GQG Partners was the largest shareholder of Abbott Laboratories (NYSE:ABT), with a stake worth $1563.6 million reported as of the end of December. Trailing GQG Partners was Fisher Asset Management, which amassed a stake valued at $819.6 million. Diamond Hill Capital, Adage Capital Management, and AQR Capital Management were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position GQG Partners allocated the biggest weight to Abbott Laboratories (NYSE:ABT), around 5.36% of its 13F portfolio. Coe Capital Management is also relatively very bullish on the stock, setting aside 3.58 percent of its 13F equity portfolio to ABT.
With a general bullishness amongst the heavyweights, key hedge funds were leading the bulls’ herd. Tudor Investment Corp, managed by Paul Tudor Jones, established the largest position in Abbott Laboratories (NYSE:ABT). Tudor Investment Corp had $7.3 million invested in the company at the end of the quarter. Mark R. Freeman’s Socorro Asset Management also initiated a $4.2 million position during the quarter. The other funds with brand new ABT positions are Matthew Hulsizer’s PEAK6 Capital Management, Matthew Tewksbury’s Stevens Capital Management, and Alex von Furstenberg and Mal Serure’s Arrow Capital Management.
Let’s check out hedge fund activity in other stocks similar to Abbott Laboratories (NYSE:ABT). These stocks are Oracle Corporation (NASDAQ:ORCL), AbbVie Inc (NYSE:ABBV), Cisco Systems, Inc. (NASDAQ:CSCO), Thermo Fisher Scientific Inc. (NYSE:TMO), Broadcom Inc (NASDAQ:AVGO), Exxon Mobil Corporation (NYSE:XOM), and Accenture Plc (NYSE:ACN). This group of stocks’ market values are closest to ABT’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ORCL | 52 | 2450210 | -4 |
| ABBV | 83 | 6965013 | 1 |
| CSCO | 60 | 4974309 | 1 |
| TMO | 89 | 5470797 | 9 |
| AVGO | 59 | 3342445 | 0 |
| XOM | 63 | 2208617 | 11 |
| ACN | 50 | 2133706 | 4 |
| Average | 65.1 | 3935014 | 3.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 65.1 hedge funds with bullish positions and the average amount invested in these stocks was $3935 million. That figure was $4303 million in ABT’s case. Thermo Fisher Scientific Inc. (NYSE:TMO) is the most popular stock in this table. On the other hand Accenture Plc (NYSE:ACN) is the least popular one with only 50 bullish hedge fund positions. Abbott Laboratories (NYSE:ABT) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for ABT is 53.6. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 5.3% in 2021 through March 19th and still beat the market by 0.8 percentage points. A small number of hedge funds were also right about betting on ABT as the stock returned 10.3% since the end of the fourth quarter (through 3/19) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.
