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Hedge Funds Are Crazy About Inogen Inc (INGN)

Most investors tend to think that hedge funds and other asset managers are worthless, as they cannot beat even simple index fund portfolios. In fact, most people expect hedge funds to compete with and outperform the bull market that we have witnessed over the past few years. However, hedge funds are generally partially hedged and aim at delivering attractive risk-adjusted returns rather than following the ups and downs of equity markets hoping that they will outperform the broader market. Our research shows that hedge funds do have great stock picking skills, so let’s take a glance at the smart money sentiment towards Inogen Inc (NASDAQ:INGN).

Inogen Inc (NASDAQ:INGN) was in 21 hedge funds’ portfolios at the end of the third quarter of 2018. INGN has experienced an increase in support from the world’s most elite money managers in recent months. There were 17 hedge funds in our database with INGN holdings at the end of the previous quarter. Our calculations also showed that INGN isn’t among the 30 most popular stocks among hedge funds.

In today’s marketplace there are many tools stock market investors employ to evaluate stocks. A pair of the most underrated tools are hedge fund and insider trading signals. Our researchers have shown that, historically, those who follow the best picks of the top hedge fund managers can beat their index-focused peers by a very impressive amount (see the details here).

Richard Driehaus

Let’s take a look at the fresh hedge fund action encompassing Inogen Inc (NASDAQ:INGN).

How are hedge funds trading Inogen Inc (NASDAQ:INGN)?

Heading into the fourth quarter of 2018, a total of 21 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 24% from the previous quarter. On the other hand, there were a total of 20 hedge funds with a bullish position in INGN at the beginning of this year. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

INGN_dec2018

Among these funds, Renaissance Technologies held the most valuable stake in Inogen Inc (NASDAQ:INGN), which was worth $89.8 million at the end of the third quarter. On the second spot was Partner Fund Management which amassed $35.1 million worth of shares. Moreover, Driehaus Capital, Rock Springs Capital Management, and Millennium Management were also bullish on Inogen Inc (NASDAQ:INGN), allocating a large percentage of their portfolios to this stock.

Now, specific money managers were leading the bulls’ herd. Partner Fund Management, managed by Christopher James, created the biggest position in Inogen Inc (NASDAQ:INGN). Partner Fund Management had $35.1 million invested in the company at the end of the quarter. Michael Platt and William Reeves’s BlueCrest Capital Mgmt. also initiated a $4.9 million position during the quarter. The other funds with new positions in the stock are Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Paul Tudor Jones’s Tudor Investment Corp, and Israel Englander’s Millennium Management.

Let’s check out hedge fund activity in other stocks similar to Inogen Inc (NASDAQ:INGN). We will take a look at Kemper Corporation (NYSE:KMPR), Oshkosh Corporation (NYSE:OSK), Viper Energy Partners LP (NASDAQ:VNOM), and Loxo Oncology Inc (NASDAQ:LOXO). This group of stocks’ market values are closest to INGN’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
KMPR 14 113382 5
OSK 30 448412 10
VNOM 12 139992 2
LOXO 30 909394 -2
Average 21.5 402795 3.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 21.5 hedge funds with bullish positions and the average amount invested in these stocks was $403 million. That figure was $283 million in INGN’s case. Oshkosh Corporation (NYSE:OSK) is the most popular stock in this table. On the other hand Viper Energy Partners LP (NASDAQ:VNOM) is the least popular one with only 12 bullish hedge fund positions. Inogen Inc (NASDAQ:INGN) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard OSK might be a better candidate to consider a long position.

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

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