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The

Vanguard Healthcare Fund (Trades, Portfolio) disclosed in a regulatory filing that its top transactions during the third quarter included closing its positions in Viatris Inc. (TRV, financial) and universal health services (UHS, Financial), a reduction in its stake in Vertex Pharmaceuticals Inc. (VRTX, Financial), a new stake in GSK PLC (LSE: GSK, Financial) and a strengthening of its stake in DexCom (DXCM, Financial).

Managed by Jean Hynes, the fund seeks long-term capital appreciation by investing in stocks broadly representing the healthcare sector. In September, the top industries in the fund by weighting were drugmakers, biotechnology, health benefit plans, and medical devices and instruments, with weightings of 38.53%, 20.60%, 14, 96% and 12.97%.

Investors should be aware that portfolio updates for mutual funds do not necessarily provide a complete picture of a guru’s holdings. The data comes from quarterly updates on the website of the fund(s) in question. These are usually long positions in US and foreign stocks. All figures are at the end of the quarter only; it is possible that the guru has already made changes to the positions after the end of the term. However, even this limited data can provide valuable information.

Viatris

The fund sold all of its 55,233,099 Viatris shares (TRV, Financial), reducing its equity portfolio by 1.3%.

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Shares of Viatris averaged $9.84 during the third quarter; the stock is valued at its fair value based on its price/value ratio GF of 0.92.

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The Canonsburg, Pennsylvania-based drugmaker has a GF score of 68 out of 100 based on a profitability ranking of 6 out of 10, a financial strength ranking of 4 out of 10, a growth ranking of 3 out of 10 and a 5 out of 10 rating for momentum and GF value.

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Viatris’ profitability ranks 6 out of 10 thanks to operating margins higher than more than 63% of its global competitors, despite returns on equity and assets exceeding just over half of the world’s drugmakers.

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Universal health services

The fund sold all 1,622,122 shares of Universal Health Services (UHS, Financial), reducing its equity portfolio by 0.37%.

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Shares of Universal Health Services averaged $103.34 during the third quarter; the stock is significantly undervalued based on its GF price-to-value ratio of 0.68 as of Friday.

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The King of Prussia, Pennsylvania-based acute care hospital company has a GF score of 94 out of 100. Even though the company’s financial strength ranks just 5 out of 10, Universal Health Services has a ranking of growth of 10 out of 10, a momentum rank of 7 out of 10 and a rank of 9 out of 10 for profitability and GF value.

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Universal Health Services’ profitability ranks 9 out of 10 on several positive investment signs, which include a five-star business predictability ranking, a high F Piotroski score of 7 out of 9, and a gross profit margin that surpasses approximately 92% of global competitors. .

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Vertex Pharmaceuticals

The fund sold 465,866 shares of Vertex Pharmaceuticals (VRTX, Financial), eliminating 10.37% of the position and 0.29% of its equity portfolio.

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Vertex shares averaged $287.72 during the third quarter; the stock is valued at its fair value based on its price/value ratio GF of 0.98.

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The Boston-based biotech company has a GF score of 85 out of 100 based on a growth ranking of 10 out of 10, a financial strength ranking of 9 out of 10, a profitability ranking of 7 out of 10, a GF value ranking 5 out of 10 and a dynamic score of 3 out of 10.

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GSK-API

The fund has invested in 8,482,455 shares of GSK PLC (LSE: GSK, Financial), giving the position a weighting of 0.29% of the equity portfolio. Shares averaged £15.25 ($17.35) during the third quarter; the stock is valued at its fair value based on its price/value ratio GF of 0.91.

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The UK-based drugmaker has a GF score of 79 out of 100 based on a profitability ranking of 8 out of 10, a growth ranking of 7 out of 10, a GF value ranking of 5 out of 10 and a 4 out of 10 for financial strength and momentum.

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Gurus holding stakes in US GSK shares (GSK, financial) include Dodge & Cox,

Ken Fisher (Trades, Portfolio)’s Fisher Investments and

Jim Simons (Businesses, Portfolio)’ Renaissance Technologies.

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DexCom

The fund added 2,009,208 shares of DexCom (DXCM, Financial), strengthening the position by 183.7% and its equity portfolio by 0.38%.

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DexCom shares averaged $84.70 during the third quarter; the stock is slightly undervalued based on its GF price-to-value ratio of 0.89.

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The San Diego-based medical device company has a GF score of 75 out of 100 based on a growth ranking of 7 out of 10, a financial strength ranking of 6 out of 10, a profitability ranking of 4 out of 10 and a ranking of 5 out of 10 for momentum and GF value.

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DexCom’s profitability ranks just 4 out of 10, having posted only three years of positive operating profit in the past 10 years, even though profit margins and returns outperform global competitors more than 60%.

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