Abbott Laboratories (NYSE:ABT) was in 50 hedge funds' portfolio at the end of December. ABT investors should be aware of a decrease in support from the world's most elite money managers lately. There were 54 hedge funds in our database with ABT positions at the end of the previous quarter. An important piece of news came in this morning saying that Abbott Laboratories (NYSE:ABT) got a new Neutral rank at Credit Suisse.
In the eyes of most traders, hedge funds are viewed as underperforming, old financial tools of years past. While there are greater than 8000 funds with their doors open at present, we at Insider Monkey choose to focus on the moguls of this club, about 450 funds. It is estimated that this group has its hands on the majority of the hedge fund industry's total capital, and by keeping an eye on their best investments, we have found a few investment strategies that have historically outperformed the S&P 500 index. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we've started sharing our picks with our subscribers at the end of August 2012, we have topped the S&P 500 index by 24 percentage points in 7 months (explore the details and some picks here).
Equally as integral, positive insider trading sentiment is another way to parse down the stock market universe. As the old adage goes: there are many incentives for an executive to cut shares of his or her company, but only one, very simple reason why they would initiate a purchase. Several academic studies have demonstrated the impressive potential of this tactic if shareholders understand what to do (learn more here).
With these "truths" under our belt, we're going to take a gander at the latest action surrounding Abbott Laboratories (NYSE:ABT).
At the end of the fourth quarter, a total of 50 of the hedge funds we track were bullish in this stock, a change of -7% from the previous quarter. With the smart money's sentiment swirling, there exists a select group of noteworthy hedge fund managers who were boosting their stakes considerably.
According to our comprehensive database, Southeastern Asset Management, managed by Mason Hawkins, holds the most valuable position in Abbott Laboratories (NYSE:ABT). Southeastern Asset Management has a $455.5 million position in the stock, comprising 2% of its 13F portfolio. On Southeastern Asset Management's heels is Southeastern Asset Management, managed by Mason Hawkins, which held a $244.9 million position; the fund has 1.1% of its 13F portfolio invested in the stock. Some other peers that hold long positions include Ric Dillon's Diamond Hill Capital, Cliff Asness's AQR Capital Management and Phill Gross and Robert Atchinson's Adage Capital Management.
Seeing as Abbott Laboratories (NYSE:ABT) has witnessed bearish sentiment from the smart money, it's safe to say that there lies a certain "tier" of hedge funds that decided to sell off their positions entirely in Q4. Intriguingly, Ricky Sandler's Eminence Capital dropped the largest stake of the "upper crust" of funds we watch, comprising an estimated $81.3 million in stock., and Christopher Medlock James of Partner Fund Management was right behind this move, as the fund sold off about $61.3 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest fell by 4 funds in Q4.
Insider trading activity, especially when it's bullish, is best served when the company in focus has experienced transactions within the past half-year. Over the latest half-year time period, Abbott Laboratories (NYSE:ABT) has seen 1 unique insiders purchasing, and 11 insider sales (see the details of insider trades here).
Let's check out hedge fund and insider activity in other stocks similar to Abbott Laboratories (NYSE:ABT). These stocks are St. Jude Medical, Inc. (NYSE:STJ), Zimmer Holdings, Inc. (NYSE:ZMH), Intuitive Surgical, Inc. (NASDAQ:ISRG), Stryker Corporation (NYSE:SYK), and Medtronic, Inc. (NYSE:MDT). This group of stocks belong to the medical appliances & equipment industry and their market caps are closest to ABT's market cap.