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Is Advanced Energy Industries (AEIS) a Smart Long-term Buy?

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Baron Discovery Fund recently published its third-quarter commentary – a copy of which can be downloaded here. During the third quarter of 2020, the Baron Discovery Fund returned 18.83% (institutional shares). This was 11.67% better than the Russell 2000 Growth Index, the Fund’s primary benchmark index. You should check out Baron Discovery Fund’s top 5 stock picks for investors to buy right now, which could be the biggest winners of 2021.

In the Q3 2020 Investor Letter, Baron Discovery Fund highlighted a few stocks and Advanced Energy Industries Inc (NASDAQ:AEIS) is one of them. Advanced Energy Industries Inc (NASDAQ:AEIS) is a semiconductor manufacturing company. Year-to-date, Advanced Energy Industries Inc (NASDAQ:AEIS) stock gained 40.4% and on December 2nd it had a closing price of $99.99. Here is what Baron Discovery Fund said:

"Advanced Energy Industries, Inc. manufactures power conversion products that are key components in industrial equipment. Its products transform, refine, and modify grid-delivered electrical power into controllable, usable power for semiconductor, industrial, health care, data center, and telecommunications infrastructure applications. We added to our investment in the quarter as we believe that this is a solid industrial growth company that can accelerate its revenues coming out of the pandemic. We also think that given its success in integrating the large Artesyn acquisition (completed in September 2019), that the company’s balance sheet will support meaningful additional transactions in the future."

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In Q2 2020, the number of bullish hedge fund positions on Advanced Energy Industries Inc (NASDAQ:AEIS) stock increased by about 50% from the previous quarter (see the chart here), so a number of other hedge fund managers believe in AEIS's growth potential. Our calculations showed that Advanced Energy Industries Inc (NASDAQ:AEIS) isn't ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 216% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 121 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds' poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website:

Disclosure: None. This article is originally published at Insider Monkey.