There are a few investors on the Street today who can boast of performing well during their investing career, so well, that they have managed to become billionaires today. At Insider Monkey we pay special attention to the portfolios of the funds managed by these billionaire investors and the moves they make every quarter. Since the first quarter of 2016 has just ended, we thought of analyzing the performance of those stocks during the first three months of the year. Read further, to know how the top five stocks that billionaires covered in our database were collectively bullish on have performed so far this year.
We track prominent investors and hedge funds because our research has shown that historically their stock picks delivered superior risk-adjusted returns. This is especially true in the small-cap space. The 15 most popular small-cap stocks among a select group of investors delivered a monthly alpha of 80 basis points between 1999 and 2012 (see the details here).
#5 Pfizer Inc. (NYSE:PFE)
– Billionaires with Long Positions (as of December 31): 19
– Value of Billionaires’ Holdings (as of December 31): $4.2 billion
Pfizer Inc. (NYSE:PFE) saw a marked increase in its popularity during the fourth quarter among billionaire investors from our database with its ownership among them climbing up by four and the aggregate value of their holdings in it jumping by over 50%. A large part of that increase in popularity can be attributed to Pfizer Inc. (NYSE:PFE)’s announcement in November that it would merge with Allergan plc Ordinary Shares (NYSE:AGN) in a $160 billion deal. While both the companies mutually agreed to terminate the merger recently, Pfizer’s stock jumped on the back of this announcement. Pfizer’s stock ended the first quarter down by 7.2%, but owing to the rally it has seen this month it is now trading flat for 2016. On April 6, Pfizer said that it had agreed to reimburse $150 million for the merger-related expenses and said that it would decide on whether to split the company’s innovative and established businesses by the end of this year. Billionaire Barry Rosenstein‘s JANA Partners was one of the hedge funds that initiated a stake in the company during the fourth quarter; it bought nearly 9.17 million shares.
#4 Microsoft Corporation (NASDAQ:MSFT)
– Billionaires with Long Positions (as of December 31): 20
– Value of Billionaires’ Holdings (as of December 31): $8.03 billion
The last quarter of 2015 was one of the best periods for Microsoft Corporation (NASDAQ:MSFT)’s stock in a long time and that translated well for the company’s popularity among billionaire investors long the stock, whose number inched up by two and the aggregate value of their holdings advanced $558 million. Despite cutting its stake in the company by one-fourth to 56.62 million shares, Jeffrey Ubben‘s ValueAct Capital remained Microsoft Corporation (NASDAQ:MSFT)’s largest shareholder among funds tracked by us at the end of December. Shares of Microsoft Corporation broke below the technically important $50 mark temporarily during the fourth quarter, but managed to end the quarter on a flat note. The company is expected to declare its results for the third quarter of fiscal 2016 next week and analysts currently expect EPS of $0.64 on revenue of $22.11 billion, versus EPS of $0.61 on revenue of $21.73 billion it reported for the same quarter last year. More than the financial numbers, the Street is eagerly waiting for the company to release the growth numbers of Office 365 and its cloud platform Azure.