“It’s a larger than usual gap,” Kevin Kedra of Gabelli and Co. told Fortune in November. “But other than an act of Congress, which I don’t think will happen, the deal gets done.”
Now then, let’s take a gander at the new action encompassing Pfizer Inc. (NYSE:PFE) and see which funds are betting on big things (like a successful merger and domicile shift) for the drug behemoth.
What have hedge funds been doing with Pfizer Inc. (NYSE:PFE)?
At the end of the fourth quarter, a total of 109 of the hedge funds tracked by Insider Monkey were long this stock, an increase of 12% from the previous quarter. With hedgies’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Fisher Asset Management, managed by Ken Fisher, holds the largest position in Pfizer Inc. (NYSE:PFE). Fisher Asset Management has a $1.04 billion position in the stock, comprising 2% of its 13F portfolio. On Fisher Asset Management’s heels is Cliff Asness of AQR Capital Management, with a $563.2 million position; the fund has 1% of its 13F portfolio invested in the stock. Remaining members of the smart money with similar optimism comprise Rob Citrone’s Discovery Capital Management, Keith Meister’s Corvex Capital, and Lee Ainslie’s Maverick Capital.
Consequently, key money managers were breaking ground themselves. JANA Partners, managed by Barry Rosenstein, created the largest position in Pfizer Inc. (NYSE:PFE). JANA Partners had $296 million invested in the company at the end of the quarter. Jim Simons’ Renaissance Technologies also initiated a $257.8 million position during the quarter. The other funds with brand new PFE positions are Andreas Halvorsen’s Viking Global, Jason Karp’s Tourbillon Capital Partners, and Doug Silverman and Alexander Klabin’s Senator Investment Group.
Let’s go over hedge fund activity in other stocks similar to Pfizer Inc. (NYSE:PFE). These stocks are Wal-Mart Stores, Inc. (NYSE:WMT), Royal Dutch Shell plc (ADR) (NYSE:RDS), NIKE, Inc. (NYSE:NKE), and Verizon Communications Inc. (NYSE:VZ). All of these stocks’ market caps are closest to PFE’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| WMT | 49 | 6556548 | -12 |
| RDS | 28 | 872437 | -6 |
| NKE | 63 | 4479125 | 4 |
| VZ | 52 | 2453641 | -7 |
As you can see these stocks had an average of 48 hedge funds with bullish positions and the average amount invested in these stocks was $3.60 billion. That figure was $8.63 billion in PFE’s case. NIKE, Inc. (NYSE:NKE) is the most popular stock in this table. On the other hand Royal Dutch Shell plc (ADR) (NYSE:RDS) is the least popular one with only 28 bullish hedge fund positions. Compared to these stocks Pfizer Inc. (NYSE:PFE) is far more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers and that shares are likely trading at a pre-merger discount like Allergan’s, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
