Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Hedge Funds Have Never Been This Bullish On Abbott Laboratories (ABT)

A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended September 30, so let’s proceed with the discussion of the hedge fund sentiment on Abbott Laboratories (NYSE:ABT).

Is Abbott Laboratories (NYSE:ABT) the right pick for your portfolio? The smart money is in an optimistic mood. The number of bullish hedge fund bets moved up by 11 in recent months. Our calculations also showed that ABT isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings). ABT was in 58 hedge funds’ portfolios at the end of September. There were 47 hedge funds in our database with ABT holdings at the end of the previous quarter.
5 Most Popular Stocks Among Hedge Funds
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.

According to most stock holders, hedge funds are seen as slow, old investment vehicles of years past. While there are over 8000 funds in operation at present, We choose to focus on the upper echelon of this group, approximately 750 funds. It is estimated that this group of investors shepherd the majority of all hedge funds’ total capital, and by watching their matchless investments, Insider Monkey has come up with a few investment strategies that have historically exceeded the S&P 500 index. Insider Monkey’s flagship short hedge fund strategy surpassed the S&P 500 short ETFs by around 20 percentage points annually since its inception in May 2014. Our portfolio of short stocks lost 27.8% since February 2017 (through November 21st) even though the market was up more than 39% during the same period. We just shared a list of 7 short targets in our latest quarterly update .

Phill Gross of Adage Capital Management

Phill Gross of Adage Capital Management

Unlike the largest US hedge funds that are convinced Dow will soar past 40,000 or the world’s most bearish hedge fund that’s more convinced than ever that a crash is coming, our long-short investment strategy doesn’t rely on bull or bear markets to deliver double digit returns. We only rely on the best performing hedge funds‘ buy/sell signals. Let’s check out the fresh hedge fund action encompassing Abbott Laboratories (NYSE:ABT).

Hedge fund activity in Abbott Laboratories (NYSE:ABT)

Heading into the fourth quarter of 2019, a total of 58 of the hedge funds tracked by Insider Monkey were long this stock, a change of 23% from the previous quarter. On the other hand, there were a total of 53 hedge funds with a bullish position in ABT a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).

No of Hedge Funds with ABT Positions

The largest stake in Abbott Laboratories (NYSE:ABT) was held by GQG Partners, which reported holding $577.5 million worth of stock at the end of September. It was followed by Diamond Hill Capital with a $536.5 million position. Other investors bullish on the company included Adage Capital Management, AQR Capital Management, and Sirios Capital Management. In terms of the portfolio weights assigned to each position GQG Partners allocated the biggest weight to Abbott Laboratories (NYSE:ABT), around 5.87% of its portfolio. Sirios Capital Management is also relatively very bullish on the stock, designating 5.39 percent of its 13F equity portfolio to ABT.

As one would reasonably expect, specific money managers were leading the bulls’ herd. Millennium Management, managed by Israel Englander, assembled the largest position in Abbott Laboratories (NYSE:ABT). Millennium Management had $23 million invested in the company at the end of the quarter. Kris Jenner, Gordon Bussard, Graham McPhail’s Rock Springs Capital Management also made a $10.3 million investment in the stock during the quarter. The following funds were also among the new ABT investors: Benjamin A. Smith’s Laurion Capital Management, Matthew Tewksbury’s Stevens Capital Management, and Lee Ainslie’s Maverick Capital.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Abbott Laboratories (NYSE:ABT) but similarly valued. We will take a look at NIKE, Inc. (NYSE:NKE), Medtronic plc (NYSE:MDT), SAP SE (NYSE:SAP), and TOTAL S.A. (NYSE:TOT). This group of stocks’ market values are similar to ABT’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
NKE 63 2304473 12
MDT 50 2120499 1
SAP 18 1578895 1
TOT 17 1094583 4
Average 37 1774613 4.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 37 hedge funds with bullish positions and the average amount invested in these stocks was $1775 million. That figure was $2063 million in ABT’s case. NIKE, Inc. (NYSE:NKE) is the most popular stock in this table. On the other hand TOTAL S.A. (NYSE:TOT) is the least popular one with only 17 bullish hedge fund positions. Abbott Laboratories (NYSE:ABT) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Unfortunately ABT wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on ABT were disappointed as the stock returned 2.5% during the fourth quarter (through the end of November) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.

Disclosure: None. This article was originally published at Insider Monkey.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.