How Did Hedge Funds’ Favourite Healthcare Stocks Perform during Q2?

#2. Pfizer Inc. (NYSE:PFE)

– Investors with long positions as of March 31: 119

– Aggregate value of investors’ holdings as of March 31: $8.37 Billion

– Q2 Return: 19.8%

The elite corner of the hedge fund industry tracked by Insider Monkey increased its exposure to Pfizer Inc. (NYSE:PFE) during the first three months of 2016, as the number of funds with long positions in the company jumped to 119 from 109 quarter-on-quarter. Those 119 funds accumulated 5% of the company’s total number of outstanding shares. The shares U.S. pharma company gained 19.8% during the April-to-June period, reflecting investor confidence in the future prospects of the company despite the collapse of the planned $160 billion tie-up between Pfizer and Allergan plc (NYSE:AGN) in early April. The multi-billion-dollar inversion deal was pulled after the U.S. Treasury presented new rules to curb companies from moving their headquarters overseas to benefit from lower taxes. In late June, Pfizer completed the $5.2 billion-acquisition of Anacor Pharmaceuticals Inc., a deal announced shortly after the failed Pfizer-Allergan merger. Anacor’s flagship asset, crisaborole, is under review by the U.S. FDA for the treatment of eczema. Keith Meister’s Corvex Capital was the owner of 17.54 million shares of Pfizer Inc. (NYSE:PFE) on March 31.

#1. Allergan plc (NYSE:AGN)

– Investors with long positions as of March 31: 170

– Aggregate value of investors’ holdings as of March 31: $20.11 Billion

– Q2 Return: -13.8%

Allergan plc (NYSE:AGN) was the most popular stock among the hedge funds followed by Insider Monkey at the end of the March quarter. The number of asset managers invested in the Botox maker increased to 170 from 159 during the first three months of 2016. Those managers hoarded up 19% of the company’s outstanding shares at the end of March. Allergan has lost one-fourth of its market value since the beginning of 2016, mainly owning to the failed mega-merger with Pfizer. The stock lost almost 14% during the second quarter. Meanwhile, the Dublin-domiciled company is close to complete the $40 billion-sale of its generic-drug business to Israel-based Teva Pharmaceutical Industries Ltd (ADR) (NYSE:TEVA). At closing, Allergan will receive $33.75 billion in cash and 100.3 million Teva ordinary shares. The maker of cosmetic Botox plans to engage in smaller M&A deals to boost growth in the foreseeable future. John Paulson’s Paulson & Co. owns 5.42 million shares of Allergan plc (NYSE:AGN) as of March 31.

Disclosure: None