Hedge Funds Are Warming Up To BeiGene, Ltd. (BGNE)

The 800+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the second quarter, which unveil their equity positions as of June 30th. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards BeiGene, Ltd. (NASDAQ:BGNE).

BeiGene, Ltd. (NASDAQ:BGNE) has seen an increase in hedge fund sentiment lately. BeiGene, Ltd. (NASDAQ:BGNE) was in 21 hedge funds’ portfolios at the end of June. The all time high for this statistic is 23. Our calculations also showed that BGNE isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

To most investors, hedge funds are seen as unimportant, outdated financial tools of yesteryear. While there are more than 8000 funds trading at present, Our experts look at the upper echelon of this group, about 850 funds. These hedge fund managers handle the majority of all hedge funds’ total capital, and by tracking their matchless picks, Insider Monkey has spotted a number of investment strategies that have historically beaten the S&P 500 index. Insider Monkey’s flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points annually since its inception in March 2017. 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.

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. Keeping this in mind let’s take a look at the new hedge fund action encompassing BeiGene, Ltd. (NASDAQ:BGNE).

Do Hedge Funds Think BGNE Is A Good Stock To Buy Now?

At second quarter’s end, a total of 21 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 11% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in BGNE over the last 24 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

The largest stake in BeiGene, Ltd. (NASDAQ:BGNE) was held by Baker Bros. Advisors, which reported holding $4004.6 million worth of stock at the end of June. It was followed by Hillhouse Capital Management with a $1878 million position. Other investors bullish on the company included Rock Springs Capital Management, Driehaus Capital, and Casdin Capital. In terms of the portfolio weights assigned to each position Hillhouse Capital Management allocated the biggest weight to BeiGene, Ltd. (NASDAQ:BGNE), around 19.33% of its 13F portfolio. Baker Bros. Advisors is also relatively very bullish on the stock, setting aside 17.59 percent of its 13F equity portfolio to BGNE.

Now, key hedge funds have been driving this bullishness. Schonfeld Strategic Advisors, managed by Ryan Tolkin (CIO), initiated the largest position in BeiGene, Ltd. (NASDAQ:BGNE). Schonfeld Strategic Advisors had $10.8 million invested in the company at the end of the quarter. Michael Gelband’s ExodusPoint Capital also initiated a $6.7 million position during the quarter. The other funds with new positions in the stock are Israel Englander’s Millennium Management and John Overdeck and David Siegel’s Two Sigma Advisors.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as BeiGene, Ltd. (NASDAQ:BGNE) but similarly valued. These stocks are Skyworks Solutions Inc (NASDAQ:SWKS), Li Auto Inc. (NASDAQ:LI), Chunghwa Telecom Co., Ltd (NYSE:CHT), Southwest Airlines Co. (NYSE:LUV), Carnival Corporation (NYSE:CCL), Waste Connections, Inc. (NYSE:WCN), and Copart, Inc. (NASDAQ:CPRT). All of these stocks’ market caps match BGNE’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 31.4 hedge funds with bullish positions and the average amount invested in these stocks was $669 million. That figure was $6192 million in BGNE’s case. Southwest Airlines Co. (NYSE:LUV) is the most popular stock in this table. On the other hand Chunghwa Telecom Co., Ltd (NYSE:CHT) is the least popular one with only 7 bullish hedge fund positions. BeiGene, Ltd. (NASDAQ:BGNE) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for BGNE is 51.1. 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 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 still beat the market by 1.6 percentage points. A small number of hedge funds were also right about betting on BGNE as the stock returned 10.4% since the end of the second quarter (through 10/22) and outperformed the market by an even larger margin.

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

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