- By Graham Griffin
The guru's Stamford, Connecticut-based firm generates superior risk-adjusted returns by investing in a wide range of asset classes worldwide. It employs a long-short strategy that focuses on fundamentals and macroeconomics through bottom-up research.
On Jan. 13, Cohen purchased 3.80 million shares to boost the biopharmaceutical holding by 72.23%. On the day of the purchase, the shares traded at an average price of $4.29. Overall, the transaction had an impact of 0.08% on the portfolio and GuruFocus estimates Cohen's total loss on the holding at 3.90%.
Kadmon Holdings is a biopharmaceutical company engaged in the discovery, development and commercialization of small molecules and biologics to address disease areas of significant unmet medical need. They are currently developing product candidates within autoimmune and fibrotic diseases, oncology and genetic diseases.
On Jan. 15, the stock was trading at $4.88 per share, up 3.17%, with a market cap of $838.70 million. According to the GF Value Line, the stock is trading at a fair value rating.
GuruFocus gives the company a financial strength rating of 6 out of 10 and a profitability rank of 1 out of 10. There are currently four severe warning signs, including a declining operating margin percentage and declining revenue per share. Debt has been brought to manageable levels, but the weighted average cost of capital eclipses the return on invested capital, indicating value will be destroyed as the company tries to grow.
Cohen ranks as the fourth-largest shareholder with 5.30% of shares outstanding. The top three shareholders are Perceptive Advisors LLC (Trades, Portfolio), Consonance Capital Management LP (Trades, Portfolio) and BlackRock Inc. (Trades, Portfolio).
At the end of the third quarter, Cohen's portfolio contained 894 stocks, with 356 new holdings. It was valued at $19.52 billion and has seen a turnover rate of 44%. Top holdings at the end of the quarter included Amazon.com Inc. (NASDAQ:AMZN), Alibaba Group Holding Ltd. (NYSE:BABA), Alphabet Inc. (NASDAQ:GOOGL), Palantir Technologies Inc. (NYSE:PLTR) and Facebook Inc. (NASDAQ:FB).
By weight, the top three sectors represented were health care (22.37%), technology (19.49%) and consumer cyclical (13.66%).
Disclosure: Author owns no stocks mentioned.
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This article first appeared on GuruFocus.