We can judge whether Mallinckrodt PLC (NYSE:MNK) is a good investment right now by following the lead of some of the best investors in the world and piggybacking their ideas. There’s no better way to get these firms’ immense resources and analytical capabilities working for us than to follow their lead into their best ideas. While not all of these picks will be winners, research shows that these picks historically outperformed the market when we factor in known risk factors.
Is Mallinckrodt PLC (NYSE:MNK) a buy, sell, or hold? The best stock pickers are taking a pessimistic view. The number of long hedge fund positions were trimmed by 3 in recent months. Mallinckrodt PLC (NYSE:MNK) was in 40 hedge funds’ portfolios at the end of the third quarter of 2015. There were 43 hedge funds in our database with Mallinckrodt PLC (NYSE:MNK) positions at the end of the previous quarter. At the end of this article, we will also compare Mallinckrodt PLC (NYSE:MNK) to other stocks, including Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL), Alleghany Corporation (NYSE:Y), and Global Payments Inc (NYSE:GPN) to get a better sense of its popularity.
If you’d ask most market participants, hedge funds are assumed to be underperforming, old financial tools of yesteryear. While there are more than 8000 funds trading at the moment, our experts look at the elite of this club, around 700 funds. These investment experts handle the lion’s share of all hedge funds’ total asset base, and by observing their highest performing picks, Insider Monkey has deciphered various investment strategies that have historically outperformed the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy outpaced the S&P 500 index by 12 percentage points per year for a decade in their back tests.
With all of this in mind, we’re going to review the fresh action regarding Mallinckrodt PLC (NYSE:MNK).
What have hedge funds been doing with Mallinckrodt PLC (NYSE:MNK)?
At the end of the third quarter, a total of 40 of the hedge funds tracked by Insider Monkey were long this stock, a decline of 7% from one quarter earlier. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were upping their stakes substantially (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, John Paulson’s Paulson & Co has the largest position in Mallinckrodt PLC (NYSE:MNK), worth close to $421.6 million, amounting to 2.2% of its total 13F portfolio. On Paulson & Co’s heels is Viking Global, led by Andreas Halvorsen, holding a $250.1 million position; 1% of its 13F portfolio is allocated to the company. Remaining peers that are bullish consist of Phill Gross and Robert Atchinson’s Adage Capital Management, Neal C. Bradsher’s Broadwood Capital, and D E Shaw.