The latest 13F season has arrived, when many money managers issue required reports on their holdings. It can be worthwhile to pay attention, as you might get an investment idea or two by seeing what some major investors have been buying and selling.
For example, consider SAC Capital Advisors, run by Steven Cohen. SAC is one of the biggest hedge fund companies around, with a reportable stock portfolio totaling $17.2 billion in value as of June 30, 2013. A company doesn't generally grow that large without performing well, and indeed, Cohen has reportedly averaged returns of roughly 30% annually over two decades.
How did the hedge fund achieve its success? Well, perhaps via some insider trading. Foul play has been alleged, and the company pled guilty late last year to charges of wire fraud and securities fraud, agreeing to pay a record settlement. The company is looking into changing its name now. While you might not want to consider the managers of SAC your ethics heroes, it's not crazy to keep an eye on their investments.
SAC Capital Advisors' latest 13F report shows that it increased its holdings in Broadcom Corporation (NASDAQ: BRCM), Dynavax Technologies Corporation ( DVAX -0.69% ), and Boston Scientific Corporation ( BSX 0.63% ).
Communications chipmaker Broadcom, which specializes in high-speed wireless networking, improved high-quality digital video signals, and faster wired networking equipment, exceeded earnings expectations in its last quarter. Between 2012 and 2013, its revenue grew by 3.7%, and its fourth quarter brought an announcement of a 9% dividend increase, too. The company's LTE business is growing, with Samsung having recently signed on, and Broadcom has been developing chips for wearable technology such as fitness devices. Low expectations have been working in Broadcom's favor. Its stock yields 1.6%.
Dynavax, with a market capitalization near $500 million, is a smallish company that has been rather volatile in recent years. It recently collected a $5.4 million milestone payment from AstraZeneca, with which it's partnering to fight pulmonary diseases -- and if all goes well, it might collect $100 million more in future years. Dynavax has a lot riding on its adult hepatitis B vaccine Heplisav, and its future might be bright if it satisfies FDA safety concerns about the drug. Dynavax also has more formulations in its pipeline, though most are in early trial stages.
Stent and defibrillator specialist Boston Scientific topped earnings expectations in its fourth quarter, but stent sales were disappointing. Indeed, profits have been a bit elusive for the company in the past few years, though some see it successfully turning itself around. Like its peers, the company has been investing heavily in research and development, and its newer technologies, such as neurotech devices, have been paying off. Endoscopy sales recently rose 8%. Boston Scientific is looking for growth in emerging markets and plans to invest some $150 million in China. Analysts at Zacks Equity Research like its "strong pipeline of products under development."