Three Healthcare Stocks Hedge Funds Are Snapping Up

A former understudy of the legendary Julian Robertson, Andreas Halvorsen decided to sail on his own in 1999, founding Viking Global with two other former Tiger Management-colleagues. His stock picking talent has made him the manager of one of the largest hedge funds around, with Viking Global’s public equity portfolio being valued at more than $26.4 billion at the end of June. Halvorsen is betting big on Walgreens Boots Alliance Inc (NASDAQ:WBA), having stockpiled more than 24.6 million shares, up by 69% during the second quarter, and is also very optimistic about the prospects of Google, now known as Alphabet Inc (NASDAQ:GOOGL). Viking Global reported ownership of 2.73 million Class A shares, up by 67% over the second quarter.

While hedge funds we track control 19.8% of Laboratory Corp. of America Holdings (NYSE:LH)’ common stock, the company lost some of its appeal to them during the second quarter. The number of funds invested dropped to 52, from 59 at the end of March, while the value of their holdings decreased by 2.54% to $2.4 billion by the end of June. Larry Robbins did not follow the trend and initiated a stake in the company during the quarter, acquiring more than 3.98 million shares, which makes his fund the largest shareholder in our database. John W. Rogers is also bullish, having boosted his stake by 7% to 1.5 million shares, according to Ariel Investments’ latest quarterly report. The stock is trading at a trailing P/E ratio of 24.xx, which is nearly half the industry average of 39.30.

John Levin started Levin Capital Strategies a decade ago, seeking to use his skills in fundamental analysis to invest in large-cap stocks. His equity portfolio has grown steadily and was valued at roughly $6.76 billion at the end of the second quarter. His top ten stock picks include two financial giants: Discover Financial Services (NYSE:DFS) and Citigroup Inc (NYSE:C), the latter of which is also his biggest bet. In its latest 13F filing, Levin Capital reported ownership of 5.6 million Citigroup shares, down by 3% during the quarter, and 2.82 million shares of Discover Financial, double the amount reported at the end of March.

Hedge funds have mixed feelings towards Affymetrix, Inc. (NASDAQ:AFFX), as the number of funds in our database with long positions increased during the second quarter to 22, from 18 at the end of March, while the value of their holding was reduced by 1.1% to $156 million. Still, they control a significant 18.5% of the company’s common stock. Samuel Isaly is bullish on Affymetrix, having boosted his stake by 3% during the second quarter, taking it to 7.51 million shares. Although Affymetrix, Inc. (NASDAQ:AFFX) staged a rally at the start of 2015, it was short-lived and shares have plummeted by 14% to yesterday’s closing price of $8.34 per share. The stock carries a trailing P/E ratio of 34, which is in line with the industry average of 31.90. Second quarter revenues came in at $88.97 million, up by 4% year-over-year, while earnings were at $0.08 per share. For the current quarter Wall Street expects revenues to fall to $87.7 million, while earnings are expected to stay the same.

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