International Business Machines Corp. (IBM) Moves A Step Ahead In Processor Innovation With New 7nm Chip

What have hedge funds been doing with International Business Machines Corp. (NYSE:IBM)?

Heading into the second quarter, a total of 53 of the hedge funds tracked by Insider Monkey held long positions in this stock, a decline of 9% from one quarter earlier. With hedgies’ capital changing hands, there exists a few notable hedge fund managers who were boosting their stakes meaningfully.

When looking at the hedgies followed by Insider Monkey, Warren Buffett’s Berkshire Hathaway had the most valuable position in International Business Machines Corp. (NYSE:IBM), worth close to $12.77 billion, holding 79.57 million shares, corresponding to 11.9% of its total 13F portfolio. Sitting at the number two spot is Kenneth Mario Garschina of Mason Capital Management, with a $401.3 million position of call options underlying 2.5 million shares; 6.7% of its 13F portfolio is allocated to the position. Some other hedge funds that hold long positions encompass David E. Shaw’s D E Shaw, Prem Watsa’s Fairfax Financial Holdings, and Phill Gross and Robert Atchinson’s Adage Capital Management.

Because International Business Machines Corp. (NYSE:IBM) has witnessed declining sentiment from the aggregate hedge fund industry, it’s easy to see that there was a specific group of fund managers who were dropping their full holdings last quarter. It’s worth mentioning that Jim Simons’ Renaissance Technologies dropped the largest investment of all the hedgies monitored by Insider Monkey, totaling about $108 million in stock, while Glenn Russell Dubin of Highbridge Capital Management was right behind this move, dumping about $66.2 million worth of shares. These transactions are intriguing to say the least, as aggregate hedge fund interest was cut by five funds last quarter.

IBM has realigned its focus towards big data analytics, cloud services, and enterprise customers. With this breakthrough in chip manufacturing on its side, and the continued backing of investing gurus like Warren Buffett and Prem Watsa, we recommend a buy on IBM.

Disclosure: None