Hedge Funds Aren’t Crazy About Bruker Corporation (BRKR) Anymore

As we already know from media reports and hedge fund investor letters, hedge funds delivered their best returns in a decade. Most investors who decided to stick with hedge funds after a rough 2018 recouped their losses by the end of the fourth quarter of 2019. A significant number of hedge funds continued their strong performance in 2020 and 2021 as well. We get to see hedge funds’ thoughts towards the market and individual stocks by aggregating their quarterly portfolio movements and reading their investor letters. In this article, we will particularly take a look at what hedge funds think about Bruker Corporation (NASDAQ:BRKR).

Bruker Corporation (NASDAQ:BRKR) has experienced a decrease in hedge fund interest of late. Bruker Corporation (NASDAQ:BRKR) was in 22 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 31. There were 23 hedge funds in our database with BRKR positions at the end of the fourth quarter. Our calculations also showed that BRKR isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).

To most market participants, hedge funds are assumed to be underperforming, outdated investment vehicles of years past. While there are greater than 8000 funds in operation at the moment, Our experts look at the upper echelon of this group, about 850 funds. These investment experts oversee the lion’s share of all hedge funds’ total asset base, and by shadowing their unrivaled investments, Insider Monkey has unsheathed several investment strategies that have historically defeated the S&P 500 index. Insider Monkey’s flagship short hedge fund strategy outpaced the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Also, our monthly newsletter’s portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .

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At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, Chuck Schumer recently stated that marijuana legalization will be a Senate priority. So, we are checking out this under the radar stock that will benefit from this. We go through lists like the 10 best battery 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 we’re going to go over the recent hedge fund action regarding Bruker Corporation (NASDAQ:BRKR).

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

At first quarter’s end, a total of 22 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -4% from one quarter earlier. By comparison, 21 hedge funds held shares or bullish call options in BRKR a year ago. With hedge funds’ positions undergoing their usual ebb and flow, 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, Millennium Management held the most valuable stake in Bruker Corporation (NASDAQ:BRKR), which was worth $43.8 million at the end of the fourth quarter. On the second spot was Montanaro Asset Management which amassed $34.4 million worth of shares. D E Shaw, Citadel Investment Group, and Alyeska Investment Group 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 Montanaro Asset Management allocated the biggest weight to Bruker Corporation (NASDAQ:BRKR), around 5.07% of its 13F portfolio. Sivik Global Healthcare is also relatively very bullish on the stock, setting aside 1.88 percent of its 13F equity portfolio to BRKR.

Since Bruker Corporation (NASDAQ:BRKR) has faced bearish sentiment from the smart money, it’s easy to see that there were a few hedge funds that decided to sell off their positions entirely heading into Q2. It’s worth mentioning that Paul Marshall and Ian Wace’s Marshall Wace LLP dropped the biggest investment of the 750 funds monitored by Insider Monkey, worth an estimated $18.6 million in stock. Alan Fournier’s fund, Pennant Capital Management, also dumped its stock, about $7.9 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest dropped by 1 funds heading into Q2.

Let’s go over hedge fund activity in other stocks similar to Bruker Corporation (NASDAQ:BRKR). We will take a look at Arrival (NASDAQ:ARVL), CF Industries Holdings, Inc. (NYSE:CF), Americold Realty Trust (NYSE:COLD), Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF), Reliance Steel & Aluminum Co. (NYSE:RS), Algonquin Power & Utilities Corp. (NYSE:AQN), and Magellan Midstream Partners, L.P. (NYSE:MMP). This group of stocks’ market valuations are closest to BRKR’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
ARVL 14 164035 14
CF 44 879911 2
COLD 16 804690 -13
KOF 10 404064 4
RS 18 284275 -9
AQN 10 172616 -5
MMP 14 85039 -8
Average 18 399233 -2.1

View table here if you experience formatting issues.

As you can see these stocks had an average of 18 hedge funds with bullish positions and the average amount invested in these stocks was $399 million. That figure was $220 million in BRKR’s case. CF Industries Holdings, Inc. (NYSE:CF) is the most popular stock in this table. On the other hand Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF) is the least popular one with only 10 bullish hedge fund positions. Bruker Corporation (NASDAQ:BRKR) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for BRKR is 42.9. 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 23.8% in 2021 through July 16th and still beat the market by 7.7 percentage points. Hedge funds were also right about betting on BRKR as the stock returned 22% since the end of Q1 (through 7/16) 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.