WalletHub just released its list of the "most bought" and "most sold" stocks from 400 top hedge fund firms. With markets broiling this summer, regular investors might appreciate a peek at the stocks the big money managers are holding - and why they're holding them. Let's take a look.
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Not surprisingly, Apple (AAPL - Get Report) tops the list of hedge fund portfolio favorites. Apple is currently trading at $160 per-share, and has a one-year target estimate of $168 per share. Hedge fund managers are betting that figure is low, even as investors have apparently begun losing confidence in Washington D.C.'s ability to agree on corporate tax reform and infrastructure investment projects - initiatives that could have triggered a 3% to 4% growth in the U.S. economy. But hedge fund managers say Apple is so strong, and so popular among consumers, it can survive any market downturn. Top investing icons Warren Buffet and David Einhorn both have Apple in their "top three" stock holdings this year.
Another technology giant, Oracle (ORCL - Get Report) places second on WalletHub's "Top Five" hedge fund stock selection list, and it's easy to see why. The stock is only trading at $49 per share, but it's on a nice upward trend in 2017, up from $40 per share at the beginning the year. Overall, Oracle's stock price has risen 30.91% from its 52-week low, with a 52-week trading range of 37.62 to 51.85. In addition, Oracle's stock shares are trading above their 200-day moving average, as of August 17. The Financial Times's survey of 35 equity analyst's rates ORCL as "outperform" - the same outlook Oracle has received from Wall Street analysts since June 2013.
Surprised to see a tobacco company on the hedge fund "favorites" list right now? Don't be - Philip Morris (PM - Get Report) is surging at $115 per-share, with a year-to-date pricing upgrade of 26.19%, and a one-year rise of 15.53%. PM is among a handful of stocks that money managers believe can withstand any potential upward market volatility, geopolitical angst (as with North Korea and its nuclear saber-rattling), and any major stock market dips through the rest of 2017. In a word, Philip Morris is a "stable" bet in unstable times, and is viewed widely by hedge fund managers as a company that has what it takes to hedge against any market slides.
AbbVie (ABBV - Get Report) , trading at $70 per share, is another cornerstone portfolio pick by hedge fund managers in a volatile market. ABBV has a one-year price estimate of $79 per-share, and offers a solid $2.56 (3.64%) dividend yield. The bioscience firm's share price is trending nicely ahead of its peers this year (by about a 15% margin), and it recently saw its chronic hepatitis C virus-fighting drug Mavyret, approved by Canadian regulators. The drug has also been approved in the U.S. and the EU this year. Wall Street has surely noticed. On August 17, Josh Schimmer, biotech analyst at Evercore ISI, initiated a $95 per-share price target on ABBV, and gave it an "outperform" rating.
Broadcom (AVGO - Get Report) has a hefty $250 share prices right now, but that's up from $195 per share at the beginning of 2017, and analysts have pegged AVGO's one-year target estimate at $273 per share, so the stock has room to grow over the short-term. Broadcom offers another stellar dividend story that value-minded hedge managers love. On August 18, Macquarie Research chip analyst Srini Pajjuri called for a $10 per-share dividend for the stock by 2019, which would double its current value. Pajjuri, adds an "outperform" rating on AVGO, and issued a $280 price target, as well, over the next year. He cites Broadcom's imminent acquisition of Brocade Communications (a storage networking technology vendor) and views ongoing merger and acquisition activity as a major "tailwind" for future financial growth for the company.