It’s often a good idea to look back at a hedge fund’s performance, not just from the point of view of its returns, but also to take a deeper look at some recommendations the hedge fund manager made in the past, the analysis that they provided to explain their position. That’s why we have taken Glenview Capital, which has been one of the best-performing hedge funds, which returned 301% between 2001 and 2010 and was up by 21% in the first 10 months of 2017, and looked at some of the recommendations that the fund’s founder and CEO Larry Robbins made a couple of years ago. In this article, we are going to discuss two stocks that Mr. Robbins pitched at the 2014 Sohn Canada conference: Thermo Fisher Scientific Inc. (NYSE:TMO) and Endo International PLC (NASDAQ:ENDP), as well as two stocks that Glenview discussed in its letters to investors: Laboratory Corp. of America Holdings (NYSE:LH) and Allergan plc (NYSE:AGN).
When tracking individual hedge funds and scanning their filings with the Securities and Exchange Commission, you can get many interesting investment ideas. However, you will often have a hard time imitating these funds due to the size of their portfolios. Of course, you can take a closer look at each one of their stock picks and analyze them in order to find their potential, but it’s a lot of work. That’s why reading hedge fund letter to investors is useful, because often hedge funds discuss their bets and present, at least partially, their reasoning behind some of their moves. At Insider Monkey, we publish hedge fund investor letters and you can read them as soon as they are out by signing up on our website and adding the funds you are interested in to your watchlist in order to receive email notifications with various updates.
We follow Glenview Capital alongside more than 600 other hedge funds, as part of our flagship small-cap strategy. Every quarter we analyze these funds’ 13F portfolios and determine the best performing funds based on their stock picks. In order to generate alpha, we identify the best stocks that these funds are collectively bullish on. Since its inception in May 2014, our flagship strategy has returned over 90%, beating the S&P 500 ETF (SPY) by around 36 percentage points. We share the stock picks from our strategy in our quarterly premium newsletters that you can access by signing up here.
Glenview Capital holds a diversified equity portfolio, but in the last decade it has been heavily investing in healthcare stocks, which amass over 40% of its 13F portfolio. Healthcare stocks are also those that Mr. Robbins usually discusses either in his letters to Glenview investors or at the Ira Sohn Conferences. For example, in 2012, he discussed hospital stocks and in 2014 he presented his thesis on managed care. At the conference that took place earlier this year, he presented his bullish thesis on the Express Scripts Holding Co (NASDAQ:ESRX) and CIGNA Corporation (NYSE:CI), and CVS Health Corp (NYSE:CVS) and Aetna Inc (NYSE:AET) mergers and McKesson Corporation (NYSE:MCK). However, we are going now to take a look at some of the stocks that he pitched at past conferences and see how they performed in the meantime.