Is Gilead Sciences Worthy of Your Portfolio?

Smart money investors have mixed feelings about Gilead Sciences, Inc. (NASDAQ:GILD). At Insider Monkey we analyze hundreds of 13F filings of different hedge funds and other institutional investors and determine their collective sentiment towards thousands of stocks. This, in turn, allows us to develop investment strategies that generate market-beating returns using only one metric to pick stocks. For example, our latest strategy  identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 39.7% gains over the past 12 months and outperformed the 24.1% gain enjoyed by the S&P 500 ETFs. Our enhanced small-cap hedge fund strategy returned more than 45% over the last 12 months and outperformed SPY by more than 30 percentage points over the last 4.5 years (see more details).

In Gilead Sciences, Inc. (NASDAQ:GILD)’s case, there were 85 funds holding its shares at the end of 2016, down by two over the fourth quarter. The aggregate value of those funds’ holdings declined to $3.30 billion from $3.47 billion during the quarter and represented 3.50% of the company’s outstanding stock at the end of 2016. Even though the number of funds long the stock is significant, Gilead is far from being one of the most popular stocks. Nevertheless, among healthcare stocks, Gilead is the second most popular after Allergan plc (NYSE:AGN).

Among the largest shareholders of Gilead Sciences, Inc. (NASDAQ:GILD) are quant funds: Jim Simons’ Renaissance Technologies and D. E. Shaw. During the fourth quarter both funds boosted their stakes in the company: Renaissance by 171% to 5.27 million shares and D. E. Shaw by 280% to 4.63 million shares.

One of the most followed investors, Julian Robertson of Tiger Management, has been a long-term Gilead Sciences, Inc. (NASDAQ:GILD) bull, who has expressed his fondness of the company on several occasions. Last year, Robertson said that the company had to do more with its cash, particularly in the M&A space. However, Robertson also pointed out that he has “a little bit given up” on the company because it didn’t put all its cash to work. At the end of 2016, Tiger Management held 38,511 shares of Gilead Sciences, Inc. (NASDAQ:GILD) and the fund has been owning a stake since 2013.

Disclosure: None