Hedge Funds Hammered in Boston Scientific

Boston Scientific ($BSX)  is like that shady diner on the edge of town that’s been around forever, the one that used to be packed 3 meals a day but now just kind of opens its doors for no reason.  Nobody goes there anymore, but every once in a while, you decide to give it another chance and try the food again.

And you are rewarded with a wicked case of indigestion the next day while howing “Why, oh why did I just eat there?”

Anyway, as of this posting, Boston Scientific is getting snork-hammered, down about 18% on the day as news of a major setback with the FDA drove over 150 million shares in volume so far, much of it to the downside.

The upshot here is that this particular shady diner is loaded with hedge fund managers, many of them newly-disclosed shareholders – especially of the value-oriented variety. 

As of the latest 13F filings, BSX stock has been purchased in size by:

David Einhorn (Greenlight Capital) – he’s made BSX a 10.5% position in the fund.

John Paulson (Paulson & Co) – 5th largest stock holding, 4.5% of holdings (over 99 million shares held).

John Burbank (Passport Capital) –  BSX is a brand new position as of the 4th quarter.

David Gallo (Valinor Management) – BSX is a brand new position as of the 4th quarter.

One caveat here is that 13F filings come out 45 days after the close of a quarter and plenty could have changed between now and December 31st.  That said, this truism cuts both ways and these hedgies could just as easily have added to their BSX holdings as they could have subtracted. 

And then we must also consider that to value-oriented investors, 20% one-day sell-offs are almost always looked at as “opportunities”.

Guess we’ll see.

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