Adage Capital Partners GP L L C 13F Portfolio

The “biggest buys” table makes one thing clear: Adage decided this was the quarter to build a real Energy book and add torque to industrial earnings. The largest add is Devon Energy, where they increased the stake by +904.3%, taking it to $349.1M and 0.49% of the portfolio — a massive repositioning from rounding error to a real call on upstream cash generation at only a small gain vs cost.

They didn’t stop at one E&P name.

• Devon Energy (DVN): A +904.3% share increase and roughly $314.3M added says they want direct exposure to oil & gas production beta, not just integrated majors.
• ConocoPhillips (COP): A +13.7% add and about $85.6M more capital shows conviction that COP’s upstream scale still has legs.
• Exxon Mobil (XOM): A +29.6% increase, adding roughly $89.9M, turns XOM into a meaningful pillar of their energy complex.
• Dover (DOV): A +69.7% ramp, with about $112.8M added, is a clear vote for industrial machinery benefiting from capex and reshoring.
• UnitedHealth (UNH): A +16.1% add (~$63.9M) looks like a targeted bet on managed care as the durable compounder within Health Care, even as they cut elsewhere.
• Praxis Precision Medicines (PRAX): A +24.5% increase and about $66.9M added signal appetite for higher‑octane biotech optionality, funded by trimming more consensus pharma.
• Advanced Micro Devices (AMD) and Alphabet (GOOG): Adds of +8.9% and +2.7%, respectively, with tens of millions of fresh capital, underscore that AI compute and hyperscale infrastructure remain core growth engines.

The pattern: they’re not chasing shiny new tickers. They’re scaling existing, researched names where the risk/reward has improved relative to the staples and pharma they’re cashing out of.

On the sell side, Adage is very clearly telling you what they think is over‑owned. The sharpest cuts come in big‑pharma and GLP‑1 royalty names: Eli Lilly is down -24.1% in shares, freeing up about $276.6M, while Merck is cut -24.5% for roughly $84.5M of capital. These are poster children for crowded, low-vol narratives they no longer want as large.

The next ATM is consumer defensives.

• Procter & Gamble (PG): A -24.7% reduction, taking out roughly $102.2M, reads like a conscious de‑emphasis of low‑growth staples at modest gains vs cost.
• Coca‑Cola (KO): A -9.2% trim pulls out nearly $28.3M, again signaling that bond‑proxy consumer names are not where they see upside.
• Home Depot (HD): Down -12.2% in shares (about $41.1M), implying less enthusiasm for rate‑sensitive, housing‑linked retail.

They are also taking chips off the table in positions that have exploded in value.

• Chevron (CVX): Despite sector‑level bullishness, CVX is cut -31.0%, freeing about $128.7M — consistent with rotating from integrated, lower‑beta energy into higher‑beta production names like Devon.
• Micron (MU) and Applied Materials (AMAT): Trims of -6.5% and -14.8%, respectively, for a combined ~$153.6M, look like risk management in AI‑adjacent semis that have already delivered outsized gains.
• Roivant Sciences (ROIV): A -19.1% reduction and about $86.5M out suggests crystallizing a strong trade in a higher‑beta biotech to fund more targeted shots like PRAX.

Even in megacap tech, changes are surgical: tiny reductions in NVIDIA, Apple, Alphabet (GOOGL), Amazon, and Meta look more like housekeeping than any real reversal of the AI/cloud thesis.

At the sector level, the AI and software core is basically untouched. Technology sits at 59.45% of the top‑50 versus 59.46% last quarter — in other words, they’re not using tech as a piggy bank despite enormous embedded gains (NVIDIA and Microsoft are still up several hundred percent versus Adage’s own cost basis). That’s a strong tell: the secular compute and cloud thesis is intact.

The movement is everywhere else. Energy jumps from 3.67% to 4.67% on the back of the COP, XOM, and especially DVN builds, giving them a real upstream and integrated mix instead of a token allocation. Industrials edge up from 5.65% to 5.97% as they bulk up Dover and add to RTX, and keep Caterpillar and Norfolk Southern as cyclical infrastructure plays.

Health Care and Consumer are the donors. Health Care slides from 10.27% to 9.69%, but that hides a big internal rotation: out of high‑multiple pharma (LLY, MRK) and into managed care (UNH) and selected biotech (PRAX). Consumer Discretionary falls from 10.58% to 10.03%, and Consumer Staples from 0.82% to 0.75%, following cuts to PG, KO, and a series of modest reductions in Walmart, Costco, Home Depot, and Netflix.

Financials (JPM, BAC), payments (Visa, Mastercard), and the Berkshire plus GE Vernova sleeve are basically flat as a percentage of the book. Adage is neither bailing on quality compounding nor reaching for deep value; they’re just rebalancing the risk budget toward sectors with more operational sensitivity to a firm macro backdrop.

Taken together, the moves sketch a manager leaning into a world where nominal growth and capital spending stay robust. AI and cloud remain the structural backbone of the portfolio; Adage leaves its megacap tech crown jewels intact and even leans slightly harder into AMD and Alphabet, betting that demand for compute, bandwidth, and hyperscale infrastructure is still early‑cycle.

The incremental dollar, however, is going into things that pump, drill, weld, and insure. Bigger positions in Devon, Exxon, Conoco, Dover, RTX, and UnitedHealth show a preference for companies whose earnings step up meaningfully if energy prices stay supported and industrial and healthcare utilization remain high. This is not a “risk‑off” shift; it’s a rotation from perceived safety at any price to cash‑generative cyclicals at reasonable prices.

The trims tell you what Adage no longer needs to own in size: consensus GLP‑1 winners, defensive pharma, and bond‑proxy staples. Those remain in the book but as smaller, portfolio‑stabilizing positions rather than primary return engines. Going forward, expect them to continue recycling gains from crowded quality/defensive pockets into higher‑beta cyclicals and select healthcare and tech growth names, as long as the macro tape supports earnings growth over multiple expansion.

For outside observers, the message is straightforward: Adage believes its edge is in sizing secular winners in tech and then timing the cyclicals around them, not in hiding in the same safe havens everyone else already owns.