Here’s Why Vertex (VRTX) Landed in Alger Spectra’s Detractor List

Alger, an investment management firm, published its ‘Alger Spectra Fund’ fourth quarter 2020 investor letter – a copy of which can be downloaded here. In the letter, the fund highlighted their largest portfolio sector weightings, which is in Information Technology and Consumer Discretionary sector, with their comments on notable companies. The Communication Services sector together with the Industrial sector is where they achieved the largest chunk of their returns. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Alger Spectra Fund, in their Q4 2020 investor letter, mentioned Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX) and emphasized their views on the company. Vertex Pharmaceuticals Incorporated is a Boston, Massachusetts-based biopharmaceutical company that currently has a $57.1 billion market capitalization. Since the beginning of the year, VRTX delivered a -7.06% return, extending its 12-month gains to 4.38%. As of March 15, 2021, the stock closed at $219.65 per share.

Here is what Alger Spectra Fund has to say about Vertex Pharmaceuticals Incorporated in their Q4 2020 investor letter:

“Vertex Pharmaceuticals has become the world’s leading cystic fibrosis company by introducing the first drugs that treat the underlying disease rather than just the symptoms. Cystic fibrosis is caused by genetic abnormalities. Vertex has been able to target the proteins made by defective genes and allow them to function more normally. The shares detracted from portfolio performance when Vertex announced a disappointment in its drug discovery efforts for VX-814, one of two treatments the company is developing for Alpha-1Antitrypsin Deficiency (AATD), a genetic disorder that causes lung and liver disorders. The very surprising results were released three months earlier than expected and are delaying the development of the AATD drug.”

Our calculations show that Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, Vertex Pharmaceuticals Incorporated was in 53 hedge fund portfolios, compared to 55 funds in the third quarter. VRTX delivered a -4.00% return in the past 3 months.

The top 10 stocks among hedge funds returned 231.2% between 2015 and 2020, and outperformed the S&P 500 Index ETFs by more than 126 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Here you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

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