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Hedge Funds Have Never Been This Bullish On Tandem Diabetes Care Inc (TNDM)

The Insider Monkey team has completed processing the quarterly 13F filings for the March quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Tandem Diabetes Care Inc (NASDAQ:TNDM).

Is Tandem Diabetes Care Inc (NASDAQ:TNDM) worth your attention right now? Prominent investors are turning bullish. The number of long hedge fund bets went up by 8 lately. Our calculations also showed that tndm isn’t among the 30 most popular stocks among hedge funds. TNDM was in 33 hedge funds’ portfolios at the end of the first quarter of 2019. There were 25 hedge funds in our database with TNDM holdings at the end of the previous quarter.

Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 30.9% through May 30, 2019. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

RENAISSANCE TECHNOLOGIES

We’re going to go over the key hedge fund action encompassing Tandem Diabetes Care Inc (NASDAQ:TNDM).

What have hedge funds been doing with Tandem Diabetes Care Inc (NASDAQ:TNDM)?

Heading into the second quarter of 2019, a total of 33 of the hedge funds tracked by Insider Monkey were long this stock, a change of 32% from the fourth quarter of 2018. On the other hand, there were a total of 8 hedge funds with a bullish position in TNDM a year ago. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

No of Hedge Funds with TNDM Positions

More specifically, Two Sigma Advisors was the largest shareholder of Tandem Diabetes Care Inc (NASDAQ:TNDM), with a stake worth $58.9 million reported as of the end of March. Trailing Two Sigma Advisors was Redmile Group, which amassed a stake valued at $54.4 million. Millennium Management, Columbus Circle Investors, and Renaissance Technologies were also very fond of the stock, giving the stock large weights in their portfolios.

With a general bullishness amongst the heavyweights, key hedge funds were leading the bulls’ herd. Sandler Capital Management, managed by Andrew Sandler, initiated the biggest position in Tandem Diabetes Care Inc (NASDAQ:TNDM). Sandler Capital Management had $4.3 million invested in the company at the end of the quarter. Anand Parekh’s Alyeska Investment Group also made a $3.2 million investment in the stock during the quarter. The other funds with brand new TNDM positions are David Costen Haley’s HBK Investments, Guy Shahar’s DSAM Partners, and Noam Gottesman’s GLG Partners.

Let’s also examine hedge fund activity in other stocks similar to Tandem Diabetes Care Inc (NASDAQ:TNDM). We will take a look at MasTec, Inc. (NYSE:MTZ), VEON Ltd. (NASDAQ:VEON), Apple Hospitality REIT Inc (NYSE:APLE), and Churchill Downs Incorporated (NASDAQ:CHDN). All of these stocks’ market caps match TNDM’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
MTZ 28 874933 -1
VEON 15 71783 6
APLE 13 87640 2
CHDN 29 519547 3
Average 21.25 388476 2.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 21.25 hedge funds with bullish positions and the average amount invested in these stocks was $388 million. That figure was $492 million in TNDM’s case. Churchill Downs Incorporated (NASDAQ:CHDN) is the most popular stock in this table. On the other hand Apple Hospitality REIT Inc (NYSE:APLE) is the least popular one with only 13 bullish hedge fund positions. Compared to these stocks Tandem Diabetes Care Inc (NASDAQ:TNDM) is more popular among hedge funds. Our calculations showed that top 20 most popular stocks among hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Hedge funds were also right about betting on TNDM as the stock returned 8.9% during the same period and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.

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

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