5 Stocks to Sell Now According to Billionaire Larry Robbins

02. AmerisourceBergen Corporation (NYSE:ABC)

Number of Hedge Fund Holders as of Q2 2022: 36

AmerisourceBergen Corporation (NYSE:ABC) is a Conshohocken, Pennsylvania-based drug wholesale company. AmerisourceBergen Corporation (NYSE:ABC) posted solid Q2 results in August with an EPS normalized actual of $2.62, exceeding the analyst estimates of $2.56. The revenue of $60.06 billion also outperformed the forecasts by $1.04 billion. Glenview Capital dumped its entire stake in AmerisourceBergen Corporation (NYSE:ABC) during Q2, selling 752,648 of its shares, having a value of $116.442 million.

Heartland Advisors, in its Q3 2021 investor letter, mentioned AmerisourceBergen Corporation (NYSE:ABC) and discussed its stance on the firm. Here is what the fund said:

“The ABCs of quality.AmerisourceBergen Corp. (ABC), a leading national pharmaceutical distributor, provides an example of our approach. The company has been quietly bolstering its business model during the past few years to include animal health products for the European market and an expanded line of higher-margin, value-added services that reach beyond drug distribution. During these efforts, valuations for the company have been under pressure due to liability issues stemming from opioid litigation as well as concerns about increased scrutiny of drug prices by politicians.

Our team has been following these developments and believes the strides management has made on the business side are not being fully recognized by the market. As more clarity has emerged related to opioid litigation, we’ve increased the portfolio’s stake in AmerisourceBergen and believe the investment provides the portfolio with additional exposure to a high-quality business that is well positioned to grow despite operating in a mature industry.”

On August 4, following the release of quarterly results, Credit Suisse analyst A.J. Rice cut his price target for AmerisourceBergen Corporation (NYSE:ABC) from $180 to $175 and maintained an Outperform rating on the shares. According to the analyst, the company had sales growth outperformance in the U.S. Healthcare segment, which was partially fueled by a contract-holding mail order customer who expanded market share and boosted the company’s mail order volume. Despite the fact that mail order margins are lower than typical, Rice notes that the strength helps drive profit and cash flow.