U.S. Markets open in 4 hrs 31 mins

Artisan Partners Trimmed its iRhythm Technologies (IRTC) Position, Should You Do the Same?

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·3 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

Artisan Partners, a high value-added investment management firm, published its ‘Artisan Mid Cap Fund’ first quarter 2021 investor letter – a copy of which can be downloaded here. A return of -2.36% was recorded by its Investor Class: ARTMX, -2.32% by its Advisor Class: APDMX, and -2.30% by its Institutional Class: APHMX, in the fourth quarter of 2020, all below the Russell Midcap® Growth Index that delivered a -0.57% return and the Russell Midcap® Index that was up by 8.14% for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Artisan Mid Cap Fund, in its Q1 2021 investor letter, mentioned iRhythm Technologies, Inc. (NASDAQ: IRTC), and shared their insights on the company. iRhythm Technologies, Inc. is a San Francisco, California-based digital healthcare company that currently has a $2.1 billion market capitalization. Since the beginning of the year, IRTC delivered a -69.52% return, while its 12-month gains are down by -39.58%. As of May 05, 2021, the stock closed at $74.82 per share.

Here is what Artisan Mid Cap Fund has to say about iRhythm Technologies, Inc. in its Q1 2021 investor letter:

"Among our bottom Q1 contributors was iRhythm Technologies. Shares of GardenSM holding iRhythm were pressured due to a dramatic Medicare reimbursement reduction by private Medicare Administrative Contractor (MAC) Novitas for its Zio cardiac monitor. While most iRhythm patients have private insurance, these payors tend to directionally follow MAC reimbursement rate changes. Unfortunately, we believe fairly arcane Medicare reimbursement rules are proving to be a tricky match for iRhythm’s unique offering, which combines a monitoring device with algorithm-based analytics. Key medical societies have endorsed Zio’s clinical value, as has the UK’s National Health Service, which recently authorized the device with reimbursement rates ahead of Novitas’. Ongoing conversations between iRhythm and Novitas may lead to improved rates near term, but given the uncertainty, we have trimmed our position to a small GardenSM."

Romaset/Shutterstock.com

Our calculations show that iRhythm Technologies, Inc. (NASDAQ: IRTC) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, iRhythm Technologies, Inc. was in 19 hedge fund portfolios, compared to 26 funds in the third quarter. IRTC delivered a -58.78% return in the past 3 months.

The top 10 stocks among hedge funds returned 231.2% between 2015 and 2020, and outperformed the S&P 500 Index ETFs by more than 126 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. Here you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

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 15 best innovative stocks to buy to pick the next Tesla that will deliver a 10x return. 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.