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McKesson (MCK) Has Risen 14% in Last One Year, Underperforms Market

If you are looking for the best ideas for your portfolio you may want to consider some of Broyhill Asset Management’s top stock picks. Broyhill Asset Management, an investment management firm, is bullish on Mckesson Corp (NYSE:MCK) stock. In its Q2 2019 investor letter – you can download a copy here – the firm discussed its investment thesis on Mckesson Corp (NYSE:MCK) stock. Mckesson Corp (NYSE:MCK) is a health care company.

On August 23, 2019, Broyhill Asset Management had released its Q2 2019 investor letter. Mckesson Corp (NYSE:MCK) stock has posted a return of 14.4% in the trailing one year period, underperforming the S&P 500 Index which returned 15.5% in the same period. This suggests that the investment firm was wrong in its decision. On a year-to-date basis, Mckesson Corp (NYSE:MCK) stock has risen by 8.0%.

Let’s take a look at comments made by Broyhill Asset Management about Mckesson Corp (NYSE:MCK) stock in the Q2 2019 investor letter.

“As discussed in our year-end letter, shares of McKesson (MCK) have been under pressure because overly pessimistic investors focused on the company’s potential opioid liabilities as well as rising political uncertainty. These risks have certainly not disappeared, but continued earnings growth and free cash flow generation have been enough to convince investors that the sky is not falling, sending shares 22% higher, year to date. Since healthcare stocks are currently trading at historically depressed multiples of depressed earnings, our investments in the industry are already discounting an extremely negative future. As such, any outcome that falls short of a worst-case scenario should drive valuations meaningfully higher.”

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In Q2 2020, the number of bullish hedge fund positions on Mckesson Corp (NYSE:MCK) stock decreased by about 3% from the previous quarter (see the chart here), so a number of other hedge fund managers don’t seem to agree with Mckesson’s growth potential. Our calculations showed that Mckesson Corp (NYSE:MCK) isn’t ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 185% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 109 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. You can subscribe to our free enewsletter below to receive our stories in your inbox:

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