How do you pick the next stock to invest in? One way would be to spend hours of research browsing through thousands of publicly-traded companies. However, an easier way is to look at the stocks that smart money investors are collectively bullish on. Hedge funds and other institutional investors usually invest large amounts of capital and have to conduct due diligence while choosing their next pick. They don’t always get it right, but, on average, their stock picks historically generated strong returns after adjusting for known risk factors. With this in mind, let’s take a look at the recent hedge fund activity surrounding Perrigo Company plc (NYSE:PRGO).
Is Perrigo Company plc (NYSE:PRGO) a buy? Hedge funds are getting less optimistic. The number of bullish hedge fund bets was cut by 20 recently. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as General Growth Properties Inc (NYSE:GGP), Franklin Resources, Inc. (NYSE:BEN), and Baker Hughes Incorporated (NYSE:BHI) to gather more data points.
According to most traders, hedge funds are viewed as underperforming, old investment vehicles of yesteryear. While there are more than 8,000 funds trading today, our researchers choose to focus on the aristocrats of this group, around 700 funds. Most estimates calculate that this group of people control most of all hedge funds’ total asset base, and by tracking their inimitable investments, Insider Monkey has spotted many investment strategies that have historically outperformed the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy outstripped the S&P 500 index by 12 percentage points per annum for a decade in their back tests.
With all of this in mind, let’s take a peek at the fresh action regarding Perrigo Company plc (NYSE:PRGO).
What does the smart money think about Perrigo Company plc (NYSE:PRGO)?
Heading into Q4, a total of 63 of the hedge funds tracked by Insider Monkey held long positions in this stock, a 24% slide from one quarter earlier. With hedgies’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were upping their stakes significantly (or had already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, OZ Management, managed by Daniel S. Och, holds the biggest position in Perrigo Company plc (NYSE:PRGO). OZ Management has a $554.5 million position in the stock, comprising 1.9% of its 13F portfolio. Sitting in the 2 spot is James Dinan of York Capital Management, with a $482.8 million position; the billionaire has 6.4% of his firm’s 13F portfolio invested in the stock. Remaining peers that hold long positions include Eric Mindich’s Eton Park Capital, John Paulson’s Paulson & Co, and Jonathon Jacobson’s Highfields Capital Management.