The 5 Most Diversified Stocks That Hedge Funds Love

4. Danaher Corporation (NYSE:DHR)

Number of Hedge Fund Shareholders: 83

Danaher Corporation (NYSE:DHR) has four segments that supply products and services across a range of diverse industries, including the medical and life sciences fields, water and environmental protection, and dental care.

While Covid-19 proved to be a boon for the company, its non-Covid vaccine/therapies revenue is also growing at a double-digit rate. The majority of Danaher’s revenue is recurring, which should insulate the company from the effects of a recession. Danaher is expected to generate $7.15 billion in revenue during Q3.

Hedge fund ownership of Danaher Corporation (NYSE:DHR) soared between the end of 2018 and the end of 2021, rising by 78% while the stock tripled in value. There’s been a slight dip in the number of funds long DHR this year and the stock is off 18% in 2022. Ken Fisher’s Fisher Asset Management and Dan Loeb’s Third Point own large stakes in Danaher as of June 30.

The Weitz Investment Partners III Opportunity Fund built a new stake in Danaher Corporation (NYSE:DHR) during Q2 and praised the company’s free cash flow and strong track record of successful acquisitions in the fund’s Q2 2022 investor letter:

“Consistent with that approach, portfolio activity among our long holdings tilted toward purchases. We added to almost half our holdings by varying degrees, and we were pleased to initiate new positions in Danaher (NYSE:DHR). Danaher is a provider of instruments and diagnostic tools to medical, life science, and other desirable end-markets worldwide. The business generate significant free cash flow, possess strong competitive positions, and have excellent management teams with demonstrated acquisition records.”