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Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Bio-Rad Laboratories, Inc. (NYSE:BIO), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Is BIO stock a buy or sell? Bio-Rad Laboratories, Inc. (NYSE:BIO) has seen a decrease in activity from the world's largest hedge funds of late. Bio-Rad Laboratories, Inc. (NYSE:BIO) was in 42 hedge funds' portfolios at the end of December. The all time high for this statistic is 54. There were 48 hedge funds in our database with BIO holdings at the end of September. Our calculations also showed that BIO isn't among the 30 most popular stocks among hedge funds (click for Q4 rankings).
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017 (see the details here).
Cliff Asness of AQR Capital Management
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the House passed a landmark bill decriminalizing marijuana. So, we are checking out this under the radar cannabis stock right now. We go through lists like the 10 best battery stocks to buy to identify the next stock with 10x upside potential. 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. Keeping this in mind let's go over the latest hedge fund action surrounding Bio-Rad Laboratories, Inc. (NYSE:BIO).
Do Hedge Funds Think BIO Is A Good Stock To Buy Now?
Heading into the first quarter of 2021, a total of 42 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -13% from the previous quarter. On the other hand, there were a total of 44 hedge funds with a bullish position in BIO a year ago. With hedge funds' capital changing hands, there exists a select group of noteworthy hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
The largest stake in Bio-Rad Laboratories, Inc. (NYSE:BIO) was held by Marshall Wace LLP, which reported holding $215.3 million worth of stock at the end of December. It was followed by Intermede Investment Partners with a $131.1 million position. Other investors bullish on the company included Fisher Asset Management, Polar Capital, and AQR Capital Management. In terms of the portfolio weights assigned to each position Intermede Investment Partners allocated the biggest weight to Bio-Rad Laboratories, Inc. (NYSE:BIO), around 3.79% of its 13F portfolio. Healthcor Management LP is also relatively very bullish on the stock, earmarking 3.15 percent of its 13F equity portfolio to BIO.
Due to the fact that Bio-Rad Laboratories, Inc. (NYSE:BIO) has experienced declining sentiment from the aggregate hedge fund industry, it's safe to say that there lies a certain "tier" of funds who were dropping their full holdings by the end of the fourth quarter. Interestingly, Rajiv Jain's GQG Partners dumped the largest position of the "upper crust" of funds tracked by Insider Monkey, totaling an estimated $182.6 million in stock, and Paolo Mortarotti's Tower House Partners was right behind this move, as the fund cut about $46.4 million worth. These bearish behaviors are important to note, as total hedge fund interest was cut by 6 funds by the end of the fourth quarter.
Let's go over hedge fund activity in other stocks similar to Bio-Rad Laboratories, Inc. (NYSE:BIO). These stocks are Fox Corporation (NASDAQ:FOXA), Burlington Stores Inc (NYSE:BURL), Fox Corporation (NASDAQ:FOX), Catalent Inc (NYSE:CTLT), Akamai Technologies, Inc. (NASDAQ:AKAM), Agnico Eagle Mines Limited (NYSE:AEM), and Cheniere Energy Partners LP (NYSE:CQP). This group of stocks' market values are similar to BIO's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position FOXA,39,1293023,7 BURL,29,1335724,-1 FOX,17,530820,2 CTLT,35,839418,-5 AKAM,33,280317,-7 AEM,36,388901,8 CQP,4,9283,1 Average,27.6,668212,0.7 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 27.6 hedge funds with bullish positions and the average amount invested in these stocks was $668 million. That figure was $1118 million in BIO's case. Fox Corporation (NASDAQ:FOXA) is the most popular stock in this table. On the other hand Cheniere Energy Partners LP (NYSE:CQP) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks Bio-Rad Laboratories, Inc. (NYSE:BIO) is more popular among hedge funds. Our overall hedge fund sentiment score for BIO is 72.3. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 5.3% in 2021 through March 19th and still beat the market by 0.8 percentage points. Unfortunately BIO wasn't nearly as popular as these 30 stocks and hedge funds that were betting on BIO were disappointed as the stock returned -2.4% since the end of the fourth quarter (through 3/19) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 30 most popular stocks among hedge funds as most of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.