Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds' and successful investors' positions as of the end of the second quarter. You can find articles about an individual hedge fund's trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 5 years and analyze what the smart money thinks of Horizon Therapeutics Public Limited Company (NASDAQ:HZNP) based on that data and determine whether they were really smart about the stock.
Horizon Therapeutics Public Limited Company (NASDAQ:HZNP) has seen an increase in activity from the world's largest hedge funds of late. Horizon Therapeutics Public Limited Company (NASDAQ:HZNP) was in 45 hedge funds' portfolios at the end of June. The all time high for this statistics is 44. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 41 hedge funds in our database with HZNP positions at the end of the first quarter. Our calculations also showed that HZNP isn't among the 30 most popular stocks among hedge funds (click for Q2 rankings and see the video for a quick look at the top 5 stocks). Video: Watch our video about the top 5 most popular hedge fund stocks.
In the eyes of most stock holders, hedge funds are viewed as underperforming, old financial tools of yesteryear. While there are over 8000 funds with their doors open at present, Our researchers choose to focus on the moguls of this club, about 850 funds. Most estimates calculate that this group of people command the majority of the smart money's total capital, and by following their top picks, Insider Monkey has determined various investment strategies that have historically exceeded the S&P 500 index. Insider Monkey's flagship short hedge fund strategy outstripped the S&P 500 short ETFs by around 20 percentage points annually since its inception in March 2017. Our portfolio of short stocks lost 34% since February 2017 (through August 17th) even though the market was up 53% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
Kamran Moghtaderi of Eversept Partners
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, legal marijuana is one of the fastest growing industries right now, so we are checking out stock pitches like “the Starbucks of cannabis” to identify the next tenbagger. 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 precious metals prices. So, we are checking out this junior gold mining stock. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. 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. Keeping this in mind we're going to go over the recent hedge fund action encompassing Horizon Therapeutics Public Limited Company (NASDAQ:HZNP).
Hedge fund activity in Horizon Therapeutics Public Limited Company (NASDAQ:HZNP)
At the end of the second quarter, a total of 45 of the hedge funds tracked by Insider Monkey were long this stock, a change of 10% from the first quarter of 2020. On the other hand, there were a total of 34 hedge funds with a bullish position in HZNP a year ago. With hedgies' capital changing hands, there exists an "upper tier" of key hedge fund managers who were adding to their stakes considerably (or already accumulated large positions).
Among these funds, Renaissance Technologies held the most valuable stake in Horizon Therapeutics Public Limited Company (NASDAQ:HZNP), which was worth $573.2 million at the end of the third quarter. On the second spot was Paulson & Co which amassed $383 million worth of shares. Avoro Capital Advisors (venBio Select Advisor), Citadel Investment Group, and Adage Capital Management were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Paulson & Co allocated the biggest weight to Horizon Therapeutics Public Limited Company (NASDAQ:HZNP), around 12.24% of its 13F portfolio. Eversept Partners is also relatively very bullish on the stock, setting aside 8.57 percent of its 13F equity portfolio to HZNP.
As industrywide interest jumped, key hedge funds have jumped into Horizon Therapeutics Public Limited Company (NASDAQ:HZNP) headfirst. Adage Capital Management, managed by Phill Gross and Robert Atchinson, assembled the largest position in Horizon Therapeutics Public Limited Company (NASDAQ:HZNP). Adage Capital Management had $181 million invested in the company at the end of the quarter. Christopher James's Partner Fund Management also initiated a $63.5 million position during the quarter. The following funds were also among the new HZNP investors: Kamran Moghtaderi's Eversept Partners, Israel Englander's Millennium Management, and Brad Farber's Atika Capital.
Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as Horizon Therapeutics Public Limited Company (NASDAQ:HZNP) but similarly valued. We will take a look at ABIOMED, Inc. (NASDAQ:ABMD), Pool Corporation (NASDAQ:POOL), KB Financial Group, Inc. (NYSE:KB), Alteryx, Inc. (NYSE:AYX), Gartner Inc (NYSE:IT), Trimble Inc. (NASDAQ:TRMB), and VICI Properties Inc. (NYSE:VICI). All of these stocks' market caps are similar to HZNP's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ABMD,31,823991,4 POOL,35,492145,2 KB,6,36329,-1 AYX,48,1612975,5 IT,32,1302132,0 TRMB,26,979865,6 VICI,51,1573468,15 Average,32.7,974415,4.4 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 32.7 hedge funds with bullish positions and the average amount invested in these stocks was $974 million. That figure was $2955 million in HZNP's case. VICI Properties Inc. (NYSE:VICI) is the most popular stock in this table. On the other hand KB Financial Group, Inc. (NYSE:KB) is the least popular one with only 6 bullish hedge fund positions. Horizon Therapeutics Public Limited Company (NASDAQ:HZNP) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for HZNP is 82.3. 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 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 33% in 2020 through the end of August and still beat the market by 23.2 percentage points. Hedge funds were also right about betting on HZNP as the stock returned 35.2% since Q2 and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.