Most Popular Canadian Stocks Among Hedge Funds

#3 Magna International Inc. (USA) (NYSE:MGA)

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

– Aggregate value of investors’ holdings (as of March 31): $660.33 million

Despite its stock ending the first quarter with a gain of 6.6%, the ownership of Magna International Inc. (USA) (NYSE:MGA) among funds covered by us decreased by six and the aggregate value of their holdings in it declined by almost 50% during that time. Legendary trader Paul Tudor Jones’ Tudor Investment Corp was one of the hedge funds that sold its entire stake in the company during the first quarter. Over the past year, shares of the automotive supplier have lost 27.73% of their value. However, this decline has helped in increasing the annual dividend yield of the stock, which currently stands at 2.57%. Most analysts feel that trading at a trailing price-to-earnings multiple of 8.58 and a price-to-book multiple of 1.65, Magna International Inc. (USA) (NYSE:MGA)’s stock is extremely cheap right now. On May 7, analysts at RBC Capital reiterated their ‘Outperform’ rating on the stock, while upping their price target on it to $76 from $72, which represents a potential upside of 83% from the stock’s current trading price.

#2 Canadian Pacific Railway Limited (USA) (NYSE:CP)

– Investors with long positions (as of March 31) : 36

– Aggregate value of investors’ holdings (as of March 31): $3.03 billion

The decline in commodity prices last year took a heavy toll on Canadian Pacific Railway Limited (USA)(NYSE:CP)’s stock, which ended 2015 down by over 30%. Nevertheless, the stock is performing well this year and it looks like several hedge funds were already anticipating this move. That’s because the number of hedge funds covered by us long Canadian Pacific Railway Limited (USA) (NYSE:CP) rose by seven during the first quarter, even though the aggregate value of their holdings in it remain largely unchanged. Funds that initiated a stake in Canadian Pacific Railway Limited during the first quarter included Dmitry Balyasny‘s Balyasny Asset Management, which purchased 435,486 shares of the company. Last week, Canadian Pacific released its second-quarter results, which included EPS of CAD 2.05 ($1.55), beating estimates by CAD 0.01, while the revenue of CAD 1.45 billion slid by over 12% on the year and missed the estimates by CAD 20 million.

#1 Valeant Pharmaceuticals Intl Inc (NYSE:VRX)

– Investors with long positions (as of March 31) : 71

– Aggregate value of investors’ holdings (as of March 31): $3.14 billion

Despite its ownership among hedge funds covered by us declining by 12 and the aggregate value of their holdings in it falling by a whopping $9.14 billion, troubled pharmaceutical company Valeant Pharmaceuticals Intl Inc (NYSE:VRX) still remained the most popular Canadian stock at the end of that period among funds we cover. The company has lost 77% so far in 2016 and there seems to be no bottom for its stock at present as it trades around the $23 level. Even after this humongous fall in the stock, one of the company’s major backer Pershing Square hasn’t lost its conviction on the stock and in a recent conference call reiterated its bullish position. During the first quarter, Pershing  increased its stake in the company by 31% to almost 21.6 million shares. On June 7, Valeant Pharmaceuticals Intl Inc (NYSE:VRX) came out with its first quarter numbers, declaring EPS of $1.27 on revenue of $2.37 billion versus analysts’ expectation of EPS of $1.37 on revenue of $2.34 billion.

Disclosure: None