Glenview Capital Management recently disclosed its portfolio updates for the third quarter of 2020, which ended on Sept. 30.
Founded by Larry Robbins (Trades, Portfolio) in 2000, Glenview is a New York-based hedge fund that focuses on deep fundamental research and individual security selection. It operates via Two Funds: the Glenview Fund, which runs a long-short strategy, and the Glenview Opportunity Fund, a more concentrated and opportunistic vehicle. The firm primarily focuses on U.S. securities, though it also has some exposure to Western Europe. The majority of its investments are in the health care industry.
Based on its investing strategy, the firm's biggest new buys during the third quarter were Medtronic PLC MDT, Amgen Inc. AMGN and Healthpeak Properties Inc. PEAK.
Medtronic
The firm bought 113,882 shares of Medtronic, impacting the equity portfolio by 0.37%. During the quarter, shares traded for an average price of $100.40.
Medtronic is an Irish-American medical device company. It develops and sells a wide variety of medical devices that treat over 70 conditions. Although it is headquartered in Ireland for tax reasons, it generates the majority of its revenue in the U.S.
On Dec. 4, shares of Medtronic traded around $113.85 for a market cap of $153.19 billion. The GuruFocus Value chart rates the stock as modestly overvalued.
The company has a financial strength rating of 5 out of 10 and a profitability rating of 8 out of 10. Although the cash-debt ratio of 0.48 is ranked lower than 76% of competitors, the Altman Z-Score of 2.99 indicates that the company is not likely in danger of bankruptcy. The return on invested capital is higher than the weighted average cost of capital, indicating the company is creating value.
Amgen
The firm also invested in 45,303 shares of Amgen, impacting the equity portfolio by 0.36%. Shares traded for an average price of $247.91 during the quarter.
Based in California, Amgen is one of the world's largest independent biopharmaceutical companies. It has a wide variety of drugs already in circulation as well as a robust pipeline, with the main areas of research focusing on hematology/oncology, inflammation, bone and cardiometabolic.
On Dec. 4, shares of Amgen traded around $229.21 for a market cap of $133.44 billion. The GuruFocus Value chart rates the stock as fairly valued.
The company has a financial strength rating of 4 out of 10 and a profitability rating of 9 out of 10. The interest coverage ratio of 7.37 is lower than the industry median of 14.88, but the Piotroski F-Score of 6 out of 9 is typical of a financially stable company. The operating margin and net margin of the company remain far ahead of most competitors at 41.41% and 33.57%, respectively, for the most recent year.
Healthpeak Properties
The firm took a new holding worth 406,928 shares in Healthpeak Properties, impacting the equity portfolio by 0.35%. During the quarter, shares traded for an average price of $27.43.
Healthpeak is a real estate investment trust that invests exclusively in private-pay real estate in the health care sector, specifically senior housing, life science and medical offices. It is headquartered in Colorado.
On Dec. 4, shares of Healthpeak traded around $30.59 for a market cap of $16.47 billion. The GuruFocus Value chart rates the stock as fairly valued.
The company has a financial strength rating of 3 out of 10 and a profitability rating of 6 out of 10. The interest coverage ratio of 0.9 and Altman Z-Score of 1.23 indicate the company will likely need to raise additional liquidity to avoid bankruptcy. The company's profits have been shrinking in recent years, with a three-year revenue growth rate of -3.6% and a three-year Ebitda growth rate of -13.8%.
Portfolio overview
As of the quarter's end, the firm held shares in 45 stocks valued at a total of $3.19 billion. The top holdings were Tenet Healthcare Corp. THC with 15.20% of the equity portfolio, Takeda Pharmaceutical Co. Ltd. TAK with 9.40% and Bausch Health Companies Inc. BHC with 7.3%.
In terms of sector weighting, 74.25% of the equity portfolio was devoted to health care, with technology a distant second place at 9.81%. Smaller portions of the portfolio consist of consumer cyclical, basic materials and other companies.
Read more here:
- The Most Popular Guru Buys of the 3rd Quarter
- Top 3 New Buys of the Causeway International Value Fund
- Louis Moore Bacon's Firm Buys Fan-Favorite Names
Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.
