After a rocky start to the year, the three major U.S. stock indexes have rebounded to post gains of between 4% and 5.3% in 2016. Along with the broader market’s rebound, several major stocks have managed to post strong returns this year, and it seems like the hedge funds in our database were anticipating these moves.
In the following article we’ll take a look at five stocks that the hedge funds in our database were collectively bullish on, and which have managed to outperform the market this year.
At Insider Monkey, we track more than 750 hedge funds, whose 13F filings we analyze as part of our small-cap strategy. Our research has shown that imitating a portfolio that includes the 15 most popular small-cap stocks among hedge funds can outperform the market by as much as 95 basis points per month on average (see more details here).
#5. Johnson & Johnson (NYSE:JNJ)
– Number of Hedge Fund Shareholders (as of June 30): 82
– Total Value of Hedge Funds’ Holdings (as of June 30): $5.58 billion
– Hedge Funds’ Holdings as Percent of Float (as of June 30): 1.7%
We’ll start with Johnson & Johnson (NYSE:JNJ), which was held by 82 hedge funds in our system on June 30, up by 6.5% quarter-over-quarter. Among the most bullish were Ken Fisher’s Fisher Asset Management, which disclosed ownership of 10.84 million shares worth $1.33 billion as of June 30, and Ken Griffin’s Citadel Advisors, which boosted the size of its holding by 64% during the second quarter, to 1.98 million shares.
Shares of Johnson & Johnson (NYSE:JNJ) have risen by 16.08% year-to-date, all while paying out an annualized dividend that yields more than 2.7%. However, the stock has lost almost 5% since the beginning of August. In late-September, shares tumbled even though the FDA approved the use of STELARA (ustekinumab) for the treatment of adults with certain cases of moderately-to-severely-active Crohn’s disease. STELARA is produced by Janssen Pharmaceuticals, a Johnson & Johnson subsidiary.
#4. Comcast Corporation (NASDAQ:CMCSA)
– Number of Hedge Fund Shareholders (as of June 30): 88
– Total Value of Hedge Funds’ Holdings (as of June 30): $9.68 billion
– Hedge Funds’ Holdings as Percent of Float (as of June 30): 6.1%
Next up is Comcast Corporation (NASDAQ:CMCSA), which counted the backing of several major hedge funds at the end of June, including Mehdi Mahmud’s First Eagle Investment Management, which held 26.21 million shares valued at $1.7 billion, and the Alex Snow-led Lansdowne Partners, which owned 24.48 million shares at the end of the second quarter.
Comcast Corporation (NASDAQ:CMCSA) shares have jumped by almost 15.82% year-to-date, helped by acquisitions, strong second-quarter results, and an expanding internet business, among other things. In late-September, the company announced that it was acquiring the remaining 24% stake in its Spectacor business, giving it full ownership of it. Former Chairman Ed Snider held the portion that was bought by Comcast.
On the second page of this article, we’ll check out three more stocks that hedge funds were buying in the second quarter that have proven to be great purchases.