In this article we will analyze whether AMN Healthcare Services Inc (NYSE:AMN) is a good investment right now by following the lead of some of the best investors in the world and piggybacking their ideas. There’s no better way to get these firms’ immense resources and analytical capabilities working for us than to follow their lead into their best ideas. While not all of these picks will be winners, our research shows that these picks historically outperformed the market by double digits annually.
AMN Healthcare Services Inc (NYSE:AMN) has seen an increase in support from the world’s most elite money managers recently. AMN Healthcare Services Inc (NYSE:AMN) was in 24 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic was previously 22. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that AMN isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
In the financial world there are a lot of tools investors employ to evaluate stocks. Some of the less utilized tools are hedge fund and insider trading activity. We have shown that, historically, those who follow the top picks of the top hedge fund managers can outpace their index-focused peers by a significant amount (see the details here). Also, our monthly newsletter’s portfolio of long stock picks returned 185.4% since March 2017 (through August 2021) and beat the S&P 500 Index by more than 79 percentage points. You can download a sample issue of this newsletter on our website.
Kamran Moghtaderi of Eversept Partners
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best EV stocks 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 homepage. With all of this in mind we’re going to review the recent hedge fund action regarding AMN Healthcare Services Inc (NYSE:AMN).
Do Hedge Funds Think AMN Is A Good Stock To Buy Now?
At the end of the second quarter, a total of 24 of the hedge funds tracked by Insider Monkey were long this stock, a change of 26% from the first quarter of 2020. On the other hand, there were a total of 21 hedge funds with a bullish position in AMN a year ago. With the smart money’s sentiment swirling, there exists a few key hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).
Among these funds, Millennium Management held the most valuable stake in AMN Healthcare Services Inc (NYSE:AMN), which was worth $28.5 million at the end of the second quarter. On the second spot was Driehaus Capital which amassed $25.2 million worth of shares. Arrowstreet Capital, Eversept Partners, and Navellier & Associates 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 Navellier & Associates allocated the biggest weight to AMN Healthcare Services Inc (NYSE:AMN), around 1.41% of its 13F portfolio. Eversept Partners is also relatively very bullish on the stock, setting aside 1.21 percent of its 13F equity portfolio to AMN.
As aggregate interest increased, specific money managers were breaking ground themselves. Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, created the most valuable position in AMN Healthcare Services Inc (NYSE:AMN). Arrowstreet Capital had $16.7 million invested in the company at the end of the quarter. Kamran Moghtaderi’s Eversept Partners also initiated a $15.4 million position during the quarter. The other funds with brand new AMN positions are Louis Navellier’s Navellier & Associates, Renaissance Technologies, and Ray Dalio’s Bridgewater Associates.
Let’s go over hedge fund activity in other stocks similar to AMN Healthcare Services Inc (NYSE:AMN). These stocks are Silgan Holdings Inc. (NASDAQ:SLGN), W.R. Grace & Co. (NYSE:GRA), Allakos Inc. (NASDAQ:ALLK), Innovative Industrial Properties, Inc. (NYSE:IIPR), BigCommerce Holdings, Inc. (NASDAQ:BIGC), 1Life Healthcare, Inc. (NASDAQ:ONEM), and PDC Energy Inc (NASDAQ:PDCE). This group of stocks’ market caps are similar to AMN’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SLGN | 13 | 236757 | -4 |
| GRA | 34 | 1664650 | -9 |
| ALLK | 12 | 344514 | -1 |
| IIPR | 15 | 200989 | 2 |
| BIGC | 21 | 603321 | -5 |
| ONEM | 33 | 744817 | 3 |
| PDCE | 23 | 248042 | -1 |
| Average | 21.6 | 577584 | -2.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 21.6 hedge funds with bullish positions and the average amount invested in these stocks was $578 million. That figure was $145 million in AMN’s case. W.R. Grace & Co. (NYSE:GRA) is the most popular stock in this table. On the other hand Allakos Inc. (NASDAQ:ALLK) is the least popular one with only 12 bullish hedge fund positions. AMN Healthcare Services Inc (NYSE:AMN) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for AMN is 67.3. 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. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 24% in 2021 through October 22nd and beat the market again by 1.6 percentage points. Unfortunately AMN wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on AMN were disappointed as the stock returned -0.5% since the end of June (through 10/22) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.
Follow Amn Healthcare Services Inc (NYSE:AMN)
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Disclosure: None. This article was originally published at Insider Monkey.
