HBM Healthcare Investments: The Case For Healthcare Investing

Antonio Garufi presented his in-depth investment thesis on HBM Healthcare Investments (Switzerland: HBMN) at European Investing Summit 2016.

HBM Healthcare Investments is a Swiss investment company with a CHF 710 million market cap. It invests globally in healthcare assets, both in public companies (58% of assets) and private companies and funds (14% and 13% of assets, respectively). The healthcare sector is well positioned, underpinned by strong drivers, to deliver strong returns in the coming years. HBM gives an interesting angle to healthcare investing by giving access to a great collection of specialized assets. The company has a great track record of creating value from its private holdings through IPOs or trade sales (50+ transactions since 2004). Its public holdings have been performing well and the current portfolio has a very interesting risk reward profile. HBM is trading at a ~28% discount to NAV (greater than the historical average), although current NAV does not reflect the expected revaluation of private assets (which are mostly booked at cost) and the value potential from public investments (which are marked to market). HBM’s portfolio is well diversified among sub-sectors, but focused on high-conviction positions. Moreover, HBM has a friendly shareholder policy as it allocates 5% of resources to dividends and a share buyback program on a yearly basis.

About the instructor:

Antonio Garufi is a portfolio manager at Decalia Asset Management, based in Geneva. He has more than a decade of experience in finance, of which he spent one year with Citigroup and three years with J.P. Morgan in London. He then went on the buyside at Astor Investment in Milan, where he analyzed and executed several investment opportunities across a number of sectors and asset classes. He graduated from Bocconi University in 2005, where he is currently lecturer, has a Phd in Business Administration and attended the Value Investing Program at Columbia Business School. He is passionate about fundamental analysis, margin of safety and in depth research.

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