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Allergan Among Health Care Holdings in Alan Fournier's Portfolio

The sector is 17.50% of his portfolio, and Allergan is the most heavily weighted stake

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Dec 15, 2015
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Alan Fournier (Trades, Portfolio) manages Pennant Master Fund,Pennant Windward Master Fund, Broadway Gate Master Fund Ltd. and Pennant General Partner LLC. He manages a portfolio composed of 36 stocks with a total value of $4.731 billion.

The health care sector represents 17.5% of his total portfolio, and his holdings are the following.

He holds 652,100 shares of Allergan PLC (AGN) that is 3.75% of his total assets and 0.17% of outstanding shares of the company. During the last quarter the investor increased his stake by 196.41%, with an impact of 2.48% on the portfolio.

The company is engaged in development, manufacturing, marketing, sale and distribution of generic, branded generic, brand name, biosimilar and over-the-counter pharmaceutical products. During the last quarter it reported a 90% increase in net revenue and 65% growth in non-GAAP EPS.

GuruFocus gives Allergan a profitability and growth rating of 8 out of 10 with good returns, ROE 6.56% and ROA 3.62% that are outperforming 50% of the companies in the Global Drug Manufacturers - Specialty & Generic industry. Financial strength has a rating of 6 out of 10, with a weak cash-to-debt of 0.05 that is far below the industry median of 1.42.

Vanguard Health Care Fund (Trades, Portfolio) is the company's main guru shareholder with 2.33% of outstanding shares, followed by Andreas Halvorsen (Trades, Portfolio) with 1.83%, John Paulson (Trades, Portfolio) with 1.82% and Daniel Loeb (Trades, Portfolio) with 0.93%.

He holds 4,868,734 shares of Boston Scientific Inc. (BSX); that is 1.69% of his total assets and 0.36% of outstanding shares of the company. During the last quarter the investor increased his stake by 37.34% with an impact of 0.46% on the portfolio.

The company is a developer, manufacturer and marketer of medical devices that are used in a broad range of interventional medical specialties. Driven by strong sales and differentiated adjusted operating margin expansion, the company had an excellent third-quarter performance.

GuruFocus gives Boston Scientific a profitability and growth rating of 6 out of 10 with negative returns (ROE -6.06%, ROA -2.31%) that are underperforming 59% of the companies in the Global Medical Devices industry. Financial strength has a rating of 3 out of 10, with a very weak cash-to-debt of 0.06 that is far below the industry median of 2.56

The company's largest shareholder among the gurus is

Vanguard Health Care Fund (Trades, Portfolio) with 4.77% of outstanding shares followed by PRIMECAP Management (Trades, Portfolio) with 3.24%, Diamond Hill Capital (Trades, Portfolio) with 1.54% and Alan Fournier (Trades, Portfolio) with 0.36%.

He holds 2,248,676 shares of Envision Healthcare Holdings Inc. (EVHC), 1.75% of his total assets and 1.2% of outstanding shares of the company. During the last quarter the investor increased his stake by 13.61%, with an impact of 0.21% on the portfolio.

The company is engaged in providing physician-led, outsourced medical services in the United States with approximately 34,000-plus affiliated clinicians. The company reported an 18.9% increase for revenue, and Envision’s adjusted EBITDA margin was 10.4% compared with 13.4% for the prior-year period.

The stock looks overpriced at the current price of $24.05. The DCF calculator gives a fair value of $8.45, estimating the stock is overvalued by 185%. GuruFocus gives Envision Healthcare a profitability and growth rating of 6 out of 10 with weak returns (ROE 8.43%, ROA 3.06%) that are underperforming 54% of the companies in the Global Long-Term Care Facilities industry. Financial strength has a rating of 6 out of 10, with a cash-to-debt of 0.06 that is below the industry median of 0.32.

Andreas Halvorsen (Trades, Portfolio) is the company's main guru shareholder with 5.28% of outstanding shares, followed by Vanguard Health Care Fund (Trades, Portfolio) with 3.15%, Alan Fournier (Trades, Portfolio) with 1.2% and Columbia Wanger (Trades, Portfolio) with 0.68%.

He holds 3,043,781 shares of Impax Laboratories Inc. (IPXL); that is 2.27% of his total assets and 4.32% of outstanding shares of the company. During the last quarter the investor reduced his stake by 5% with an impact of 0.15% on the portfolio.

It is a technology-based, specialty pharmaceutical company applying formulation and development expertise, as well as its drug delivery technology, to the development, manufacture and marketing of bioequivalent pharmaceutical products, commonly referred to as "generics" in addition to the development and marketing of branded products. The company reported a 40% increase for revenues and 21% for adjusted diluted EPS. GAAP diluted EPS increased by 123% .

The stock looks overpriced at the current price of $41.1. The DCF calculator gives a fair value of $3.98, estimating the stock is overvalued by 933%. GuruFocus gives Impax a profitability and growth rating of 4 out of 10 with weak returns like ROE 2.95% and ROA 1.73% that are underperforming 63% of the companies in the Global Drug Manufacturers - Specialty & Generic industry. Financial strength has a rating of 9 out of 10, with a cash-to-debt of 0.76 that is below the industry median of 1.42

The company’s largest shareholder among the gurus is

Alan Fournier (Trades, Portfolio), followed by Kyle Bass (Trades, Portfolio) who holds 0.86% of outstanding shares of the company, NWQ Managers (Trades, Portfolio) with 0.85% and John Hussman (Trades, Portfolio) with 0.21%.

He holds 1,999,797 shares of DaVita HealthCare Partners Inc. (DVA); that is 3.06% of his total assets and 0.95% of outstanding shares of the company. During the last quarter the investor reduced his stake by 7.35% with an impact of 0.25% on the portfolio.

It is a provider of dialysis services in the United States for patients suffering from chronic kidney failure, also known as end stage renal disease, or ESRD.

The stock looks overpriced at the current price of $68.07. The DCF calculator gives a fair value of $39.31, estimating the stock is overvalued by 73%. GuruFocus gives DaVita HealthCare a profitability and growth rating of 8 out of 10 with weak returns (ROE 9.58%, ROA 2.62%) that are underperforming 57% of the companies in the Global Medical Care industry. Financial strength has a rating of 7 out of 10, with a cash-to-debt of 0.21, slightly below the industry median of 0.31.

Warren Buffett (Trades, Portfolio) is the company's main guru shareholder with 18.28% of outstanding shares, followed by Steve Mandel (Trades, Portfolio) with 3.75%, Andreas Halvorsen (Trades, Portfolio) with 1.3%.

He holds 2,731,124 shares of WellCare Health Plans Inc. (WCG); that is 4.97% of his total assets and 6.19% of outstanding shares of the company. During the last quarter the investor reduced his stake by 6.65% with an impact of 0.33% on the portfolio.

The company provides managed care services exclusively to government-sponsored health care programs. It expects its Iowa Medicaid business to be a meaningful contributor to its results in the long term after investments that it is making to ramp up operations and transition members to this new managed Medicaid program.

The stock looks overpriced at the current price of $78.36. The DCF calculator gives a fair value of $27.4, estimating the stock is overvalued by 186%. GuruFocus gives WellCare a profitability and growth rating of 6 out of 10 with weak returns (ROE 6.94%, ROA 2.40%) that are underperforming 56% of the companies in the Global Health Care Plans industry. Financial strength has a rating of 8 out of 10, with a cash-to-debt of 1.36 that is slightly below the industry median of 1.75.

The company's largest shareholder among the gurus is Fournier followed by

Vanguard Health Care Fund (Trades, Portfolio) with 2.7%, Mariko Gordon (Trades, Portfolio) with 1.34% and HOTCHKIS & WILEY with 0.99%.

The last quarter, the investor closed his position in Amgen Inc. (AMGN) with an impact of 0.40% on the portfolio, showing the stock doesn’t look attractive anymore.

It is a biotechnology company that discovers, develops, manufactures and delivers human therapeutics. It operates in one business segment being human therapeutics.

The stock looks overpriced at the current price of $158.11. The DCF calculator gives a fair value of $148.21, estimating the stock is overvalued by 7%. GuruFocus gives Amgen a profitability and growth rating of 9 out of 10 with strong returns (ROE 6.94%, ROA 2.40%) that are overperforming 89% of the companies in the Global Biotechnology industry. Financial strength has a rating of 6 out of 10, with a cash-to-debt of 0.98 that is far below the industry median of 28.98

PRIMECAP Management (Trades, Portfolio) is the company's main guru shareholder with 3.87% of outstanding shares, followed by Daniel Loeb (Trades, Portfolio) with 1.31%, Vanguard Health Care Fund (Trades, Portfolio) with 0.74% and Jim Simons (Trades, Portfolio) with 0.21%.

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