Woodline Partners Portfolio: A Comprehensive Analysis of Holdings and Performance

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HFA Staff
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Woodline Partners Portfolio

Woodline Partners is a San Francisco-based investment firm founded in 2018 by Michael Rockefeller and Karl Kroeker. The fund had a solid 2023 delivering 12.2% returns while focusing on the Technology, Healthcare, and Industrial sectors. Woodline Partners Portfolio is at an estimated $9.17 billion AUM along 464 holdings.

AbbVie Inc. (NYSE:ABBV) takes the helm, with Ely Lilly and Company (NYSE:LLY) in a close second. In third is Regeneron Pharmaceuticals (NASDAQ:REGN) and in fourth is Permian Resources Corp (NYSE:PR). 

Recent substantial changes in the portfolio are the 378% increase in the Ovintiv Inc (NYSE: OVV) holding, and the reduction in Analog Devices (NASDAQ: ADI). The recent performances were not inflicted by recent accusations of inappropriate conduct filed against the top managers in the fund. For more information about this young hedge fund that has a lot to offer, stay with us.

Key Takeaways

  • Woodline Partners is a hedge fund founded in 2018 based in San Francisco.
  • Their strategy is focused on investing in healthcare, industrial, and technology sectors.
  • In the last three years, the fund delivered a solid 47.18% cumulative returns.
  • The portfolio is highly diversified, while the largest positions are in AbbVie, Ely Lilly and Company, and Regeneron Pharmaceuticals.

Key Holdings

AbbVie Inc. (NYSE:ABBV) with 2.15% of the portfolio

Since their inception in 2018 Woodline Partners several times introduced AbbVie holding in their portfolio. In Q3 2022 they bought 187 thousand stocks at $143.50, and since then they increased their stake to 1.27 million stocks. The holding is valued at $197 million while the average stock buying price is $143. The stock slightly gained value reaching $161.

Ely Lilly and Company (NYSE:LLY) with 2.01% of the portfolio

Woodline Partners, as a major investor in the healthcare sector, aims to have a solid stake in the pharmaceutical giant Ely Lilly and Company. They reached their maximum stake size in Q2 2022 with 496 thousand shares, and since then they reduced it to 317 thousand. This comes as an increase from Q3 2023 for 45 thousand stocks raising the value of the holding to $184 million. The firm has been buying LLY stocks for an average of $389 while the current value is $764 generating solid gains.

Regeneron Pharmaceuticals (NASDAQ:REGN) with 1.63% of the portfolio

The firm has Regeneron in its sights for some time, increasing its holding to 170 thousand shares in Q4 2024. The holding is valued at $149 million, and the stock value has seen a solid increase in the last three years. Woodline has been buying their stocks on a $741 average, while in 2024 the price jumped from $878 to $984. For now, this proved to be a great addition to the portfolio, but it still has to show its full potential.

Permian Resources Corp (NYSE:PR) with 1.50% of the portfolio

Woodline owns a massive stake of 10.14 million shares placing them amongst the top stakeholders of the company. This is a new find and the first investment was made in Q2 2023 the holding is currently valued at $137.84 million. In every quarter since Woodline increased its stake, the stock price continued to rise. They bought shares on $11.50 average, while the price is now at $16.80 with an upward trend.

Ovintiv Inc (NYSE:OVV) with 1.49% of the portfolio

Ovintiv's 3.12 million holdings are valued at $136.8 million and is another fresh addition to the portfolio. Woodline Partners LP decided to initially invest in Q3 2023 buying 651 thousand stocks. In Q4 they raised their stake to their current state. On average, they were paying them $45, and the price is now at $50.

TE Connectivity (NYSE:TEL) with 1.38% of the portfolio

While Woodline Partners have been trading earlier TE Connectivity stocks, they made a significant step in Q4 2023. They bought additional 843 thousand stocks increasing their stake to 901 thousand. The entire holding is valued at $126.61 million. The share value is on its two-year maximum valuation of $149.

Analog Devices (NASDAQ:ADI) with 1.36% of the portfolio

ADI is the only holding among major players in Woodline Portfolio to reduce in late 2024. The company trimmed its position from 1.02 million stocks to 628 thousand. The stock value is at its maximum in the last five years, reaching $212. The holding is valued at $124 million, and for a short period, it managed to generate a surplus.

Gilead Sciences Inc. (NASDAQ:GILD) with 1.29% of the portfolio

GILD is the largest position in the Woodline portfolio that is currently in the red. From the beginning of 2024, their price dropped from $84 to $67. Before that, the firm increased its stake from 700 thousand to 1.46 million stocks. The value of this position is $118.61 million, while the firm on average paid $74 per stock.

Karuna Therapeutics Inc. (NASDAQ:KRTX) with 1.23% of the portfolio

KRTX stock doubled in value during 2022 jumping from $114 to over $200. The company was acquired by Bristol Myers Squibb in March 2024, and before that managed to achieve a price of $330. Woodline significantly increased its stake in Q4 2024 from 22 thousand to 357 thousand shares.

Qorvo Inc. (NASDAQ:QRVO) with 1.18% of the portfolio

After cutting their forecast due to a weak outlook Qorvo stock value tumbled from $118 to $95. Woodline Partners owns 963 thousand stocks with a price tag of $108.44 million. This is a second holding in the red amongst the top 10 holdings. The loss is still not high, because the average buying price was at $103. How will Woodline Partners react to new developments is yet to be seen.

Sector Allocation

While Woodline Partners points out their preference for the Technology, Healthcare, and Industrial sectors, their portfolio is well-diversified among several other industries. Besides owning a stake in a massive 464 holdings, their sector allocation is also diverse:

  • Healthcare with 38.9% of the portfolio valued at $3.56 billion
  • Technology with 26.3% of the portfolio valued at $2.41 billion
  • Industrials with 10.9% of the portfolio valued at $999 million
  • Consumer Discretionary with 9.57% of the portfolio valued at $877 million
  • Energy with 8.41% of the portfolio valued at $771 million
  • Consumer Staples with 1% of the portfolio valued at $91 million

Woodline Partners Investment Strategy

The cornerstone of their approach is a long/short equity strategy that is market-neutral avoiding systemic risk factors. Woodline Partners relies on the more traditional approach to investing focusing on utilizing the fundamental analysis. They prefer a bottom-up approach, meaning opting to analyze the fundamentals of the company.

This doesn't mean that the company doesn’t pay attention to wider geographical and market factors, since they have investments in three continents. However, the basis of their analysis is the hard evidence gathered from economic parameters and the industry outlook of the company.

Woodline Partners is heavily reliant on diversification, both in a geographical and industry sector view. The majority of their investment effort is focused on the industrial, healthcare, and technological sectors. Regarding locations, they are not over-concentrated on the United States market, opting for investment moves across Europe and Asia.

Woodline Partners Performance Analysis

Historical Performance

In the last three years, the fund performed above average and received a 5-star rating from the Hedge Follow website. In the past three-year period the fund's top 20 holdings delivered 47.18% cumulative returns. The top 50 holdings in the same time frame delivered an exceptional 36.43%.

Notable Success

  • Ely Lilly And Company Holding

LLY holding is constantly a big position in Woodline Partners' portfolio, and it is generating solid returns. In two years of trade, the stock price doubled in comparison to the average buying price.

Notable Failure

  • Viavi Solutions Holding

The company is focused on developing and manufacturing testing and monitoring equipment for networks. It is not a major part of the portfolio with a 0.61% weighting, however, its value of $55.80 is not to be discarded. While Woodline Partners have been paying their stocks on a $12.6 average, today that price is at $7.5. Since March the value is in free fall.

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The post above is drafted by the collaboration of the Hedge Fund Alpha Team.