Glenview Capital Management’s hedge funds generated healthy returns in the first half of the year.
The hedge fund firm headed by Larry Robbins posted a 13.8 percent gain in its flagship Glenview Capital Partners fund, according to a person who has seen the results. Glenview Opportunity, a more concentrated fund, was up 9.6 percent for the period.
Glenview’s little-known and very small healthcare fund, Glenview Healthcare Partners, surged 14.2 percent in the first half. The fund gravitates toward healthcare services rather than to fledgling biopharma companies.
Glenview’s main funds lagged the S&P 500, which was up 16.9 percent for the first half of the year, including dividends reinvested. But keep in mind that the S&P 500 has been driven this year by a handful of tech and internet stocks that have doubled and even tripled in price.
Glenview generally avoids these kinds of stocks, so its performance is even better than it appears at first glance. And unlike many of the high-flying, tech-oriented hedge funds, Glenview isn’t desperately trying to dig out of a sinkhole created by a year or two of huge losses.
Instead, Glenview Capital Partners lost less than 9 percent last year and is now solidly back above the breakeven point, while Glenview Opportunity finished in the black last year.
Glenview declined to comment.
Until recently, Glenview’s long portfolio was heavily dominated by healthcare stocks. However, at the end of the first quarter — the last period for which this information is available — just four of the firm’s top 10 U.S.-listed common stock longs were healthcare companies or companies that serve the healthcare industry.
These include number-one long Cigna, the health insurance giant, and number-two long Tenet Healthcare, the healthcare services provider. The two stocks together account for about 20 percent of Glenview’s U.S.-listed long portfolio, according to the firm’s latest 13F filing.
Cigna was down more than 15 percent in the first half of the year, but the other three healthcare companies finished solidly in the black. Tenet surged by about 67 percent, healthcare facilities provider HCA gained 26 percent, and drug distributor McKesson rose nearly 14 percent.
Meanwhile, financial technology services provider Fiserv, Glenview’s largest non-healthcare stock, was up 25 percent for the first half, while US Foods Holding, the food service distributor and Glenview’s ninth-largest long, surged more than 29 percent for the period.
In the first quarter, Glenview also boosted its hedge in the stock market, lifting its put option position in the SPDR S&P 500 exchange traded fund by about two-thirds.
