Ray Dalio (Trades, Portfolio) quadrupled his stake in AmerisourceBergen Corp. (ABC, Financial) in the first quarter. The guru acquired 185,507 shares for an average price of $89.32 per share.
AmerisourceBergen has a market cap of $16.36 billion, a P/E ratio of 11.23, an enterprise value of $18.32 billion, a P/B ratio of 7.75 and a dividend yield of 1.75.
AmerisourceBergen is the leader in global pharmaceutical sourcing and distribution services. The company serves healthcare providers and pharmaceutical manufacturers in the pharmaceutical supply channel and provides drug distribution and related services designed to reduce costs and improve patient outcomes.
AmerisourceBergen distributes a comprehensive offering of brand-name and generic pharmaceuticals, over-the-counter health care products, home health care supplies and equipment and related services to a variety of health care providers mainly located in the U.S. and Canada including acute care hospitals and health systems, independent and chain retail pharmacies, mail order pharmacies, medical and dialysis clinics, physicians, long-term care and other alternate site pharmacies. AmerisourceBergen currently has more than 18,000 associates and more than 150 company-owned offices around the globe. It has 26 pharmaceutical distribution centers, four U.S. specialty distribution centers and two Canadian distribution centers.
AmerisourceBergen is also traded in Germany.
It is likely that Dalio quadrupled his stake for the following reasons:
- Pharmaceutical sales in the U.S., as recently estimated by IMS Healthcare Inc., an independent third-party provider of information to the pharmaceutical and health care industry, are expected to grow approximately 7.2% annually from 2015 through 2019, primarily due to strong demand, favorable pricing and new product introductions. In addition to general economic conditions, factors that impact the growth of the pharmaceutical industry in the U.S. and other industry trends include:
- The number of individuals age 65 and over in the U.S. is expected to exceed 53 million by 2019. It is the most rapidly growing segment of the population. This age group suffers from more chronic illnesses and disabilities than the rest of the population and accounts for a substantial portion of total health care expenditures in the U.S. The aging population should create more revenue for AmerisourceBergen in the future.
- The company has reported excellent revenue growth (15.80%) over the previous 10 years. The company has also significantly improved its EBITDA Growth (8,656%) and its free cash flow growth (29.90%).
- The company has a Beneish M-Score of -2.69 according to GuruFocus which suggests that the company is not a manipulator of its financial statements.
- The company dividend yield is close to a 10-year high
Below is a Peter Lynch Chart for AmerisourceBergen.
Dalio founded Bridgewater Associates in 1975, from his two-bedroom apartment in New York City. Today, Bridgewater Associates is the world's biggest hedge fund firm and manages $155 billion according to Forbes.com.
Cheers to your investment success.
Start a free seven-day trial of Premium Membership to GuruFocus.
