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Top Five Guru-Held Health Care Stocks

December 18, 2013 | About:
Monica Wolfe

Monica Wolfe

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Using the GuruFocus Aggregated Portfolio Screener you can filter results to see what companies maintain the highest amount of guru ownership. By using this screener, we filtered down to see which health care companies are held by the most gurus. As of the third quarter, the following five health care companies are held by the largest number of gurus.

Johnson & Johnson (JNJ)

The most-held medical company is Johnson & Johnson with 46 guru shareholders. During the past quarter there were16 gurus making buys and 19 gurus makings sells of their stake in JNJ. These gurus hold on to a combined weighting of 80.60%.

The top guru shareholders of Johnson & Johnson:

1. Jeremy Grantham: 21,210,245 shares, representing 0.75% of the company’s shares outstanding.

2. James Barrow: 17,194,257 shares, representing 0.61% of the company’s shares outstanding.

3. PRIMECAP: 13,813,887 shares, representing 0.49% of the company’s shares outstanding.

Johnson & Johnson is engaged in the research and development, manufacture and sale of a range of products in the health care field. It is a holding company which has more than 250 operating companies. The company’s operating segments are focused in: consumer, pharmaceutical and medical devices and diagnostics.

Johnson & Johnson’s historical revenue and net income:

The analysis on Johnson & Johnson reports that the company’s operating margin is expanding, its dividend yield is near a 5-year low and its price is near a 10-year high.

The Peter Lynch Chart suggests that the company is currently overvalued:

Johnson & Johnson has a market cap of $257.79 billion. Its shares are currently trading at around $91.39 with a P/E ratio of 20.30, a P/S ratio of 3.72 and a P/B ratio of 3.69. The dividend yield of Johnson & Johnson is currently at 2.83%. Johnson & Johnson had an annual average earnings growth of 4.5% over the past ten years.

Pfizer Inc. (PFE)

The second most held guru medical stock is in Pfizer. There are 34 guru shareholders with eleven of those making buys along with 15 gurus making sells of their stock in the company. These gurus hold a combined weighting of 46.19%.

The top guru shareholders of Pfizer:

  • Dodge & Cox: 67,406,435 shares, representing 1.02% of the company’s shares outstanding.
  • James Barrow: 60,897,666 shares, representing 0.92% of the company’s shares outstanding.
  • Jeremy Grantham: 47,726,111 shares, representing 0.72% of the company’s shares outstanding.

Pfizer is a global pharmaceutical firm which develops and produces medicines and vaccines for a range of conditions which include areas of immunology, inflammation, oncology, cardiovascular and metabolic diseases, neuroscience and pain.

Pfizer’s historical revenue and net income:

The analysis on Pfizer reports that the company’s revenue has been in decline over the past year, the dividend yield is near a 5-year low, the price is near a 5-year high and its operating margin is expanding.

The Peter Lynch Chart suggests that the company is currently undervalued:

Pfizer has a market cap of $195.6 billion. Its shares are currently trading at around $30.18 with a P/E ratio of 8.40, a P/S ratio of 3.80 and a P/B ratio of 2.60. Pfizer’s stock currently holds a dividend yield of 3.20%. The company had an annual average earnings growth of 6.30% over the past ten years.

GuruFocus rated Pfizer the business predictability rank of 3-star.

Merck & Co. (MRK)

The third most guru-held medical stock of the third quarter is in Merck & Co. Over the past quarter there were 30 guru owners with 10 gurus making buys and 14 gurus making sells of their stake in the company. These gurus hold a combined weighting of 34.95%.

The top guru owners of Merck & Co:

  • Dodge & Cox: 50,137,596 shares, representing 1.71% of the company’s shares outstanding.
  • Vanguard Health: 35,919,648 shares, representing 1.23% of the company’s shares outstanding.
  • James Barrow: 29,641,593 shares, representing 1.01% of the company’s shares outstanding.

Merck & Co is a global health care company that delivers innovative health solutions through its prescription medicines, vaccines, biologic therapies, animal health, and consumer care products, which it markets directly and through its joint ventures.

Merck’s historical revenue and net income:

The analysis on Merck reports:

  • The company has issued $8.7 billion of debt over the past three years.
  • The revenue has been in decline over the past year.
  • The price is sitting near a 5-year high.
  • The company’s asset growth is currently faster than its revenue growth.

The Peter Lynch Chart suggests that the company is currently overvalued:

Merck & Co has a market cap of $139.9 billion. Its shares are currently trading at around $47.86 with a P/E ratio of 32.10, a P/S ratio of 3.30 and a P/B ratio of 3.10. The company had an annual average earnings growth of 1.80% over the past ten years.

Baxter International (BAX)

The fourth most held medical stock is in Baxter International were 28 guru owners. There were eleven gurus making buys along with ten guru sells over the past quarter. These gurus hold on to a combined weighting of 19.35%.

The top guru shareholders of Baxter International:

  • Vanguard Health: 3,179,300 shares, representing 0.59% of the company’s shares outstanding.
  • Jeremy Grantham: 2,709,258 shares, representing 0.5% of the company’s shares outstanding.
  • Tweedy Browne: 2,603,888 shares, representing 0.48% of the company’s shares outstanding.

Baxter International is a diversified healthcare company. Through its subsidiaries, it develops, manufactures and markets products that save and sustain the lives of people with hemophilia, immune disorders, infectious diseases, kidney disease, trauma, and other chronic and acute medical conditions.

Baxter’s historical revenue and net income:

The analysis on Baxter reports that the company has shown predictable revenue and earnings growth, its price is nearing a 10-year high, the dividend yield is at a 10-year high and the company has issued $4.5 billion of debt over the past three years.

The Peter Lynch Chart suggests that the company is currently overvalued:

Baxter International has a market cap of $35.63 billion. Its shares are currently trading at around $65.65 with a P/E ratio of 16.60, a P/S ratio of 2.50 and a P/B ratio of 4.60. The company had an annual average earnings growth of 12.20% over the past 10 years.

GuruFocus rated Baxter International the business predictability rank of 4.5-star.

Medtronic (MDT)

The fifth largest guru-held position goes to Medtronic where there are currently 25 guru owners of the company. There were eleven gurus making buys and there were twelve gurus making sells of their stake in the company. These gurus hold a combined weighting of 23.26%.

The top three guru shareholders of Medtronic:

1. James Barrow: 32,327,133 shares, representing 3.21% of the company’s shares outstanding.

2. PRIMECAP: 32,130,321 shares, representing 3.19% of the company’s shares outstanding.

3. Vanguard Health Care Fund: 10,532,800, representing 1.05% of the company’s shares out

The company is engaged in providing medical technology- alleviating pain, restoring health, and extending life for people. Medtronic develops, manufactures, and markets its medical devices in more than 140 countries.

Medtronic’s historical revenue and net income:

The analysis on Medtronic reports that the company has shown predictable revenue and earnings growth as well as an expanding operating margin. It also notes that the company’s dividend yield is near a 3-year low, it has issued $411 million in debt over the past three years and the price is sitting at around its 10-year high.

The Peter Lynch Chart suggests that the company is currently overvalued:

Medtronic has a market cap of $56.48 billion. Its shares are currently trading at around $56.56 with a P/E ratio of 15.10, a P/S ratio of 3.40 and a P/B ratio of 3.00. The company had an annual average earnings growth of 7.60% over the past ten years.

GuruFocus rated Medtronic the business predictability rank of 4-star.

You can check out other top held sectors of the market by using the Aggregated Screener here.

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