In this piece, we will take a look at the ten healthcare stocks to buy according to Lee Ainslie’s Maverick Capital.
Lee Ainslie is a hedge fund investor who is in charge of the investment fund Maverick Capital. Mr. Ainslie founded Maverick Capital in 1993 when he was just 28 years old. Over the years he has seen the hedge fund’s portfolio grow to billions of dollars, making it into one of the largest of its kind in the world.
Prior to creating Maverick Capital, Mr. Ainslie worked at the hedge fund Tiger Management which is based out of New York and had a portfolio worth $36 billion in 2019. The executive has a Bachelor’s in systems engineering from the University of Virginia and a Master’s in Business Administration (MBA) from the University of North Carolina
Mr. Ainslie’s interest in the financial world was developed at an early age when he helped his father, the head of a high school, with tracking students’ investments as part of a project by an investing club. This would see the now hedge fund executive develop a software that would track students’ investments and keep note of their performance. The club would also educate Mr. Ainslie on the basics of investment, familiarizing him with concepts such as market capitalization and the price to earnings (P/E) ratio.
Maverick Capital, which sticks to its age old mantra of “our objective is to preserve and grow capital”, has a portfolio that was worth $9.9 billion as of the end of the third quarter of this year. Hundreds of companies form a part of this portfolio, and they cover several industries such as industrials, financial payments, healthcare, social media, and technology. Some of the well known companies in Mr. Ainslie’s portfolio are Amazon.com, Inc. (NASDAQ:AMZN), Microsoft Corporation (NASDAQ:MSFT), and Meta Platforms, Inc. (NASDAQ:FB). By March 2021, the fund’s returns had surged to cross 40%.
Lee Ainslie of Maverick Capital
Our Methodology
In order to find out which healthcare stocks are on Mr. Ainslie’s mind, we looked through Maverick Capital’s 13F filings for the third quarter of this year.
With this context in mind, let’s now discuss our list of the 10 healthcare stocks to buy according to Lee Ainslie’s Maverick Capital.
10 Healthcare Stocks to Buy According to Lee Ainslie’s Maverick Capital
10. LivaNova PLC (NASDAQ:LIVN)
Maverick Capital’s Stake Value: $42 million
Percentage of Maverick Capital’s 13F Portfolio: 0.42%
Number of Hedge Fund Holders: 32
LivaNova PLC (NASDAQ:LIVN) is a cardiovascular and neuromodulation device designer and manufacturer that is headquartered in the United Kingdom. The company’s products allow its customers to conduct heart valve repair and nerve stimulation therapy, among other uses.
Mr. Ainslie’s Maverick Capital owned 535,690 LivaNova PLC shares as the third quarter of this year ended. These were worth $42 million and represented 0.42% of its portfolio. A Q3 2021 Insider Monkey survey of 867 hedge funds revealed that 32 owned the company’s shares.
For its fiscal Q3, LivaNova PLC reported $253 million in revenue and $0.68 in non-GAAP EPS, beating analyst estimates for both. Goldman Sachs set a $108 price target for the company in December 2021, outlining that the company’s under development drugs and their revenue are not factored into its share price.
LivaNova PLC’s largest investor is Natixis Global Asset Management’s Harris Associates who owns 3.8 million shares worth $302 million.
Diamond Hill Capital mentioned LivaNova in its Q3 2021 investor letter outlining that:
“Our health care holdings were negative in aggregate, but outpaced index peers, which boosted relative performance along with our below-benchmark positioning On an individual holdings’ basis, we exited global medical technology company LivaNova as shares approached our estimate of intrinsic value.”
LivaNova PLC is one of Mr. Ainslie’s favorite stocks, just like Microsoft Corporation, Amazon.com, Inc., and Meta Platforms, Inc.
9. Rocket Pharmaceuticals, Inc. (NASDAQ:RCKT)
Maverick Capital’s Stake Value: $49 million
Percentage of Maverick Capital’s 13F Portfolio: 0.5%
Number of Hedge Fund Holders: 17
Rocket Pharmaceuticals, Inc. (NASDAQ:RCKT) is an American company that focuses on developing gene therapies through biotechnology for children with serious diseases. Its products aim to treat bone marrow defects, immune system problems, anemia, and infantile osteoporosis.
Rocket Pharmaceuticals, Inc. had a GAAP EPS of -$0.79 in its fiscal Q3, which missed analyst estimates. Chardan raised its price target on the stock to $60 from $56 in December 2021, stating that the drug company’s product test results continue to impress.
Maverick Capital’s stake in the company equaled $49 million and made up 0.5% of its portfolio as of the end of Q3 2021. 17 of the 867 hedge funds tracked by Insider Monkey for the same period held the company’s shares.
Kevin C. Tang’s Tang Capital Management is Rocket Pharmaceuticals, Inc.’s largest investor. It has a $75 million stake through 2.5 million shares.
8. Curis, Inc. (NASDAQ:CRIS)
Maverick Capital’s Stake Value: $59 million
Percentage of Maverick Capital’s 13F Portfolio: 0.59%
Number of Hedge Fund Holders: 21
Curis, Inc. (NASDAQ:CRIS) is a biotechnology firm focused on developing cancer treatments. Its treatments aim to target several types of lymphomas and solid tumors.
As Q3 2021 came to an end, Mr. Ainslie’s hedge fund owned 7.5 million Curis, Inc. shares which were worth $59 million and represented 0.59% of its portfolio. During the same time period, 21 of the 867 hedge funds polled by Insider Monkey owned the company’s shares.
Curis, Inc. had a strong third fiscal quarter when it posted $3 million in revenue and -$0.12 in GAAP EPS, beating analyst estimates for both.
Curis, Inc.’s largest investor after Mr. Ainslie is Phill Gross and Robert Atchinson’s Adage Capital Management, who owns 3.9 million shares worth $30 million.
7. 1Life Healthcare, Inc. (NASDAQ:ONEM)
Maverick Capital’s Stake Value: $74 million
Percentage of Maverick Capital’s 13F Portfolio: 0.74%
Number of Hedge Fund Holders: 34
1Life Healthcare, Inc. (NASDAQ:ONEM) is a healthcare platform provider which allows its members to access digital health services. It also provides them with in-office care under medical insurance.
Maverick Capital owned 3.6 million 1Life Healthcare, Inc. shares during the third quarter of this year. This allowed it to have a $74 million stake which made up for 0.74% of its portfolio. Insider Monkey’s Q3 2021 survey of 867 hedge funds revealed that 34 owned the company’s shares.
1Life Healthcare, Inc.’s largest investor is Chase Coleman, and Feroz Dewan’s Tiger Global Management LLC who owns 10 million shares worth $217 million.
1Life Healthcare, Inc. raked in $151 million in revenue and -$0.51 in GAAP EPS in its fiscal Q3, beating analyst revenue estimates and missing them for EPS. Its price target was reduced to $32 from $39 in December 2021 by Credit Suisse who shared that the company’s new reporting structure influenced the decision.
LRT Capital Management mentioned 1Life Healthcare, Inc. in its Q3 2021 investor letter. It stated that:
“Mercadolibre, Inc. (MELI) – the LatAm eCommerce, shipping, and payments company, is now trading at a very attractive valuation – its lowest P/S ratio ever. The concerns here have to do with the recession in Brazil and slowing economic growth throughout the region.”
6. Humana Inc. (NYSE:HUM)
Maverick Capital’s Stake Value: $97.8 million
Percentage of Maverick Capital’s 13F Portfolio: 0.98%
Number of Hedge Fund Holders: 60
Humana Inc. (NYSE:HUM) is an American company headquartered in Kentucky which provides several healthcare services. These include prescription medicines, Medicaid benefits, health insurance, and military services.
For its fiscal Q3, Humana Inc. brought in $20 billion in revenue, which missed analyst estimates. However, the company beat estimates for non-GAAP EPS by posting $4.83 in the segment. Morgan Stanley reduced the healthcare provider’s price target to $530 from $559 in December 2021, justifying the decision by stating that Humana Inc.’s Medicare catalysts might not materialize.
Mr. Ainslie’s Maverick Capital held 251,466 Humana Inc. shares during Q3 2021 in a stake that was worth $97.8 million and represented 0.98% of its portfolio. During the same time period, 60 of the 867 hedge funds polled by Insider Monkey owned the company’s shares.
Humana Inc.’s largest investor is Natixis Global Asset Management’s Harris Associates who owns 4.3 million shares worth $1.7 billion.
Humana Inc. meets Amazon.com, Inc., Meta Platforms, Inc., and Microsoft Corporation in the list of David Ainslie’s top stock picks.
5. Nektar Therapeutics (NASDAQ:NKTR)
Maverick Capital’s Stake Value: $104 million
Percentage of Maverick Capital’s 13F Portfolio: 1.05%
Number of Hedge Fund Holders: 23
Nektar Therapeutics (NASDAQ:NKTR) is an American biotechnology company that is developing products for several diseases. Its products aim to target several types of cancers such as those of the liver, bladder, and urethra. Additionally, it is also developing a treatment for the COVID-19 coronavirus.
Nektar Therapeutics substantially missed its revenue estimates for fiscal Q3, by posting $24.9 million in the segment. However, the company’s GAAP EPS of -$0.70 beat analyst estimates by $0.10. BTIG slashed its price target for the firm to $54 from $80 in November 2021 following the earnings report, explaining that reduced revenue estimates from a treatment trial influenced the decision.
Mr. Ainslie’s Maverick Capital owned 5.8 million Nektar Therapeutics shares as the third quarter of this year came to an end. These were worth $104 million and represented 1.05% of its investment portfolio. Insider Monkey’s Q3 2021 poll of 867 hedge funds revealed that 23 owned a stake in the firm.
Nektar Therapeutics’s largest investor after Maverick Capital is Stephen Dubois’ Camber Capital Management who owns 3.7 million shares worth $67 million.
4. TG Therapeutics, Inc. (NASDAQ:TGTX)
Maverick Capital’s Stake Value: $109 million
Percentage of Maverick Capital’s 13F Portfolio: 1.11%
Number of Hedge Fund Holders: 23
TG Therapeutics, Inc. (NASDAQ:TGTX) is a biopharmaceutical company whose products cover several types of leukemias and autoimmune diseases.
Maverick Capital owned a $109 million stake in TG Therapeutics, Inc. during 2021’s third quarter. This was through holding 3.2 million shares and it represented 1.11% of the firm’s portfolio. An Insider Monkey survey of 867 hedge funds for the same time period revealed that 23 funds owned the company’s shares.
For its fiscal Q3, TG Therapeutics, Inc. sorely disappointed analysts as it missed estimates for revenue by a mile and failed to meet them for GAAP EPS as well. The company’s $2 million revenue for the quarter missed estimates by $0.94 million. In December 2021, Evercore ISI reduced the company’s price target to $36 from $55, citing worries about a potential Food and Drug Administration (FDA) advisory committee concerns for the company’s drug.
Peter Kolchinsky’s RA Capital Management is TG Therapeutics, Inc.’s largest investor. It has a $136 million stake in the company through 4 million shares.
3. Atara Biotherapeutics, Inc. (NASDAQ:ATRA)
Maverick Capital’s Stake Value: $140 million
Percentage of Maverick Capital’s 13F Portfolio: 1.41%
Number of Hedge Fund Holders: 17
Atara Biotherapeutics, Inc. (NASDAQ:ATRA) is developing treatments for patients suffering from cancer, immune system, and viral diseases. Its medicines target solid tumors, hematologic malignancies, and multiple sclerosis, among others.
Atara Biotherapeutics, Inc. raked in $5 million in revenue and -$0.90 in GAAP EPS for its fiscal Q3, beating analyst estimates for both. Stifel reduced its price target to $27 from $30 in October 2021.
Mr. Ainslie’s hedge fund had a stake of $140 million in Atara Biotherapeutics, Inc. through holding 7.8 million shares. It represented 1.41% of its portfolio during Q3 2021. During the same time period, 17 of the 867 hedge funds polled by Insider Monkey also held a stake in the medical firm.
Atara Biotherapeutics, Inc.’s largest investor is Seth Klarman’s Baupost Group who owns 8.4 million shares worth $151 million.
2. Seer, Inc. (NASDAQ:SEER)
Maverick Capital’s Stake Value: $187 million
Percentage of Maverick Capital’s 13F Portfolio: 1.88%
Number of Hedge Fund Holders: 11
Seer, Inc. (NASDAQ:SEER) is a backend life sciences company that aims to let its customers extract information from biological systems. Its products cover several areas such as proteomics which is the large-scale study of proteins and their constituent structures.
As Q3 2021 came to an end, Maverick Capital owned 5.4 million Seer, Inc. shares in a $187 million stake constituting 1.88% of its portfolio. Insider Monkey’s survey of 867 hedge funds for the third quarter of this year revealed that 11 funds held a stake in the company.
Seer, Inc.’s revenue and GAAP EPS for its fiscal Q3 stood at $2 million and -$0.30, respectively, as it only beat revenue estimates.
Seer, Inc.’s largest investor after Maverick Capital is Efrem Kamen’s Pura Vida Investments who owns 857,306 shares worth $29 million.
1. Centene Corporation (NYSE:CNC)
Maverick Capital’s Stake Value: $256 million
Percentage of Maverick Capital’s 13F Portfolio: 2.58%
Number of Hedge Fund Holders: 50
Centene Corporation (NYSE:CNC) is an American healthcare company that provides services to uninsured and underinsured individuals globally. Its services cover Medicaid users and its health plans cover several types of coverage such as therapy, dental care, vision care, and primary and specialty physicals.
Centene Corporation had a strong third fiscal quarter which saw it beat revenue and non-GAAP EPS analyst estimates by posting $32.4 billion and $1.26 in the metrics, respectively. Deutsche Bank raised the company’s price target to $84 from $80 in December 2021, appreciating the company’s recent corporate governance policies.
Mr. Ainslie’s hedge fund owned 4 million Centene Corporation shares for the third quarter of this year. This stake was worth $256 million and represented 2.58% of its portfolio. Insider Monkey’s Q3 2021 survey of 867 hedge funds revealed that 50 owned the company’s shares.
Andreas Halvorsen’s Viking Global is Centene Corporation’s largest investor through a $615 million stake bought through 9.8 million shares.
You can also take a peek at the 10 Best Robinhood Stocks Under $20 and Harvard University Stock Portfolio: 8 Latest Stock Picks.
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This article is originally published at Insider Monkey.
