5 Big Stocks Hedge Funds Love for 2016

Editors' pick: Originally published Feb. 23.

The biggest hedge funds were knocked around by the market volatility in the fourth quarter, with the top 10 largest funds losing $44 billion in the December period compared tthe third quarter of 2015.

The top 10 hedge funds had aggregated equity holdings of $159 billion at quarter's end and decreased the total number of stock positions held to 427 from 441, according to S&P Global Market Intelligence, a division of McGraw Hill Financial, in its quarterly hedge fund tracker. The report analyzed Securities and Exchange Commission 13F filings by the 10 largest hedge funds by asset size to spotlight big buying and selling trends.

That said, hedge funds were active in the quarter -- most notably by buying energy stocks. The top 10 largest hedge funds purchased a combined $1.47 billion in positions in the sector last quarter. Pioneer Natural Resources (PXD) and Williams Co. (WMB) were the two most bought energy stocks, even though the sector was the worst-performing in the fourth quarter, according to S&P Global.

The two stocks with the largest new positions in the third quarter by large hedge funds were Priceline (PCLN) and Apple (AAPL) . Hedge funds bought a combined $1.52 billion in Priceline and $1.2 billion in Apple of new equity positions.

In comparison, large hedge funds sold the most positions in the financial services sector, with a total sell off of $2.2 billion last quarter. The most-sold stock in the sector was Lloyds Banking Group (LYG) .

5 Big Stocks Hedge Funds Love for 2016

Check out the five stocks with the overall biggest investment by hedge fund managers in the fourth quarter. TheStreet highlights notable new or added positions on each of the five stocks. We've paired the list with commentary from Jim Cramer, if the stock is owned by his Action Alerts PLUS charitable trust portfolio.

 

 

 

 

5. Apple
5. Apple

Market Cap: $537 billion
Who Bought?: Tiger Global Management

Big hedge funds bought $1.21 billion in equity positions in the tech giant during the fourth quarter. That was mostly helped by Tiger Global taking a new position in Apple (AAPL) , purchasing 10.6 million shares in the fourth quarter. Tiger Global's stake is currently worth $1.03 billion, according to Bloomberg.

Of note, activist investor Carl Icahn shaved his stake in Apple, selling roughly 7 million shares last quarter. At Dec. 31, he still owned more than 45 million shares, according to Bloomberg.

Jim Cramer's Action Alerts PLUS charitable trust portfolio owns shares of Apple. Cramer recently said:

"I totally understand the difficulties that Tim Cook finds himself in given that many of us bought Apple's phones because we thought they were the most private and toughest to 'de-crypt.' You can't just cave to the government because the government will certainly use the precedent to de-crypt anyone it cares to go after. Those of us who are old enough to remember the Nixon enemies list and been friendly with people on it, know that you don't want the government deciding you're a bad actor. That said who the heck doesn't want to get a bead on any terrorist network operating in this country. That's why I think Cook's congressional solution makes the most sense."

Exclusive Look Inside:
You see Jim Cramer on TV. Now, see where he invests his money and why Apple is a core holding of his multi-million dollar portfolio.

Want to be alerted before Jim Cramer buys or sells AAPL? Learn more now.

 

4. Teva Pharmaceutical Industries
4. Teva Pharmaceutical Industries

Market Cap: $52 billion
Who Bought?: Viking Global Investors, Paulson & Co., Glenview Capital Management

Big hedge funds bought $1.27 billion in equity positions in the generic pharmaceuticals company.

Viking Global added 16.2 million shares in the fourth quarter. As Teva's (TEVA) third-largest shareholder, Viking's total position in the company, based on its Dec. 31 share count, is valued at $1.44 billion, according to Bloomberg.

As well, Paulson & Co. bought 2.4 million shares. Paulson is the company's fourth-largest shareholder with 20.4 million shares owned at Dec. 31. The stake is valued at $1.12 billion, according to Bloomberg.

Glenview added 1.76 million to its position last quarter. Bloomberg estimates Glenview's stake is valued at $342 million.

3. Valeant Pharmaceuticals
3. Valeant Pharmaceuticals

Market Cap: $26 billion
Who Bought?: Paulson & Co., Viking Global Investors

Big hedge funds bought $1.28 billion in equity positions in Valeant Pharmaceuticals (VRX) .

Paulson & Co. added 4.4 million shares to its position in Valeant. Paulson is the sixth largest investor in the pharmaceutical company, owning a nearly 4% stake in Valeant, with 13.3 million shares, currently valued at $1 billion, says Bloomberg

Viking Global bought 2.28 million shares last quarter. Its total stake in the company is approximately 7.8 million shares, valued at $592 million, according to Bloomberg. Viking Global is Valeant's 10th largest shareholder.

Of note, Valeant shares plummeted more than 10% on Monday after Wells Fargo issued a negative report on the company. Analyst David Maris told investors to sell the stock based on a series of risks to its earnings per share and liquidity, according to the Wall Street Journal.

2. Priceline Group
2. Priceline Group

Market Cap: $64 billion
Who Bought?: Tiger Global Management, Viking Global Investors

Big hedge funds bought $1.57 billion in equity positions of Priceline (PCLN) last quarter. Both Tiger Global and Viking Global each took new positions in the online travel company.

Tiger Global purchased roughly 758,000 shares. Its stake is worth $977 million, according to Bloomberg.

Viking Global purchased 394,000 shares. Its stake is worth $506 million, according to Bloomberg.

1. American International Group
1. American International Group

Market Cap: $62 billion 
Who Bought?: Icahn Capital, Glenview Capital Management

Despite hedge funds purging stocks in the financial sector, AIG (AIG) was the most bought stock in the fourth quarter, with $2.5 billion sunk into the stock thanks to Carl Icahn putting the pressure on the insurance giant.

In late October, the famous activist investor wrote a letter to AIG CEO Peter Hancock urging him to separate the conglomerate into three public companies, calling AIG "too big to succeed," according to CNBC.

Icahn purchased more than 40 million shares in the fourth quarter (he owns a total of 42 million shares of AIG). His stake in AIG is valued at $2.2 billion, according to Bloomberg.

 

Advertisement

If you liked this article you might like

Best Gains for Pioneer Natural Resources May Have Been Seen

Best Gains for Pioneer Natural Resources May Have Been Seen

Live From NAPE: Oil and Gas Drillers Excited About $60 Oil

Live From NAPE: Oil and Gas Drillers Excited About $60 Oil

3 Game-Changing Areas Where Warren Buffett Should Spend Berkshire's Tax Windfall

3 Game-Changing Areas Where Warren Buffett Should Spend Berkshire's Tax Windfall

Market's Animal Spirits Roar: Cramer's 'Mad Money' Recap (Thursday 1/11/18)

Market's Animal Spirits Roar: Cramer's 'Mad Money' Recap (Thursday 1/11/18)

Cramer: This Market Is Making Strange Bedfellows

Cramer: This Market Is Making Strange Bedfellows