The Stocks the Funds Are Buying

We all know which stocks have made Wall Street's Buy List. What I want to know -- and I'm guessing you do, too -- is who's doing the buying. Which funds are buying the latest crop of Wall Street's most popular stocks ... and how does their judgment compare with that of our Motley Fool CAPS community? 

Here's our latest group of contenders:

Company

Currently Fetching

CAPS rating

BioCryst Pharmaceuticals

$12.72

**

Innophos Holdings

$15.00

*

HealthTronics

$4.73

*

Resource Capital

$10.98

**

American Real Estate Partners

$113.43

*

Enzo Biochem

$12.93

*

Sources: Motley Fool CAPS, Yahoo! Finance

List-topper BioCryst, which specializes in therapies for cancer and other degenerative diseases, has a decent fund following. Here's a sampling:

  • Fidelity Advisor Mid Cap II T (FITIX), a 3-year-old fund that's soundly beating the market. Too bad it sports a pricey 3.50% front-end load.
  • ING FMR Diversified Mid Cap S (IFDSX), which is run by the same manager, Tom Allen. Allen has been running the ING fund a few months longer, though. And ING doesn't charge a load. Hmmmmm.
  • Fidelity Spartan Total Market Index (FSTMX), which Fido offers to conservative investors looking for a cheap way to mirror the returns of the Wilshire 5000 index.
  • Vanguard Institutional Total Stock Market Index (VITPX), an exceptionally cheap fund for large buyers who wish to balance more volatile positions against a widely diversified portfolio of stock holdings.
  • Vanguard Total Stock Market Index (VTSMX), which mirrors its institutionally minded cousin in every way except for its price and minimum investment. With only $3,000 needed to get in -- versus $200 million for its larger cousin -- individual investors can get diversified exposure to the stock market on the cheap.

Of these funds, it's ING FMR Diversified Mid Cap that interests me most. Here are its top five stock positions:

Company

Currently Fetching

CAPS rating

Juniper Networks (NASDAQ:JNPR)

$34.54

***

Altera (NASDAQ:ALTR)

$23.69

***

Thermo Fisher Scientific (NYSE:TMO)

$54.15

****

AGCO Corp. (NYSE:AG)

$43.93

*

Ameriprise Financial (NYSE:AMP)

$59.23

***

Sources: Morningstar, Motley Fool CAPS

This strikes me as a strong portfolio. Consider Thermo Scientific, which has seen extraordinary gains in free cash flow thanks to its propensity to create recurring revenue. Here's CAPS All-Star AJL203PSU with the details:

My wife is in the life sciences and the other day she was going over her labs budget. One of [Thermo Scientific's] products are single-use tubes that sell for about $0.98 each. She said they use 14,000 of them a year. There are 15 labs on her floor. And this is just one building on [the] Penn State campus. Do the math!!!

I'm sure Allen has, and has loaded up on shares of Thermo as a result. (Morningstar lists him as a recent buyer.) In case you don't have a calculator handy, 15 labs using 14,000 tubes each at $0.98 would bring the seller nearly $206,000.

For me, it often helps to see what superior stock pickers are buying. If that describes you, too, then consider Motley Fool Champion Funds. Newsletter editor Shannon Zimmerman's picks are up 15% on their respective benchmarks as I write. Check out the entire portfolio with a free no-risk trial.

That's all for now. See you back here next week, when we once again look at the funds behind the fantasy.


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