Is ABCL Stock A Buy or Sell?

In this article we will analyze whether AbCellera Biologics Inc. (NASDAQ:ABCL) 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.

Is ABCL stock a buy? Money managers were becoming more confident. The number of long hedge fund bets moved up by 25 recently. AbCellera Biologics Inc. (NASDAQ:ABCL) was in 25 hedge funds’ portfolios at the end of the fourth quarter of 2020. Our calculations also showed that ABCL isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the CBD market is growing at a 33% annualized rate, so we are taking a closer look at this under-the-radar hemp stock. We go through lists like the 10 best biotech stocks under $10 to identify the next stock with 10x upside potential. 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 website. Now let’s go over the latest hedge fund action encompassing AbCellera Biologics Inc. (NASDAQ:ABCL).

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

At Q4’s end, a total of 25 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 25 from the third quarter of 2020. Below, you can check out the change in hedge fund sentiment towards ABCL over the last 22 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 AbCellera Biologics Inc. (NASDAQ:ABCL) was held by Viking Global, which reported holding $776 million worth of stock at the end of December. It was followed by Baker Bros. Advisors with a $420.5 million position. Other investors bullish on the company included OrbiMed Advisors, SB Management, and Harvard Management Co. In terms of the portfolio weights assigned to each position Falcon Edge Capital allocated the biggest weight to AbCellera Biologics Inc. (NASDAQ:ABCL), around 8.97% of its 13F portfolio. Harvard Management Co is also relatively very bullish on the stock, setting aside 8.96 percent of its 13F equity portfolio to ABCL.

Consequently, some big names have been driving this bullishness. Viking Global, managed by Andreas Halvorsen, initiated the most valuable position in AbCellera Biologics Inc. (NASDAQ:ABCL). Viking Global had $776 million invested in the company at the end of the quarter. Julian Baker and Felix Baker’s Baker Bros. Advisors also made a $420.5 million investment in the stock during the quarter. The other funds with new positions in the stock are OrbiMed Advisors, Masayoshi Son’s SB Management, and Rick Slocum’s Harvard Management Co.

Let’s now review hedge fund activity in other stocks similar to AbCellera Biologics Inc. (NASDAQ:ABCL). We will take a look at Universal Display Corporation (NASDAQ:OLED), Guidewire Software Inc (NYSE:GWRE), Pegasystems Inc. (NASDAQ:PEGA), LKQ Corporation (NASDAQ:LKQ), Allegion plc (NYSE:ALLE), Lumen Technologies, Inc. (NYSE:LUMN), and Advance Auto Parts, Inc. (NYSE:AAP). This group of stocks’ market valuations resemble ABCL’s market valuation.

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As you can see these stocks had an average of 33.3 hedge funds with bullish positions and the average amount invested in these stocks was $1193 million. That figure was $2317 million in ABCL’s case. LKQ Corporation (NASDAQ:LKQ) is the most popular stock in this table. On the other hand Universal Display Corporation (NASDAQ:OLED) is the least popular one with only 24 bullish hedge fund positions. AbCellera Biologics Inc. (NASDAQ:ABCL) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for ABCL is 13.1. 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. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 12.3% in 2021 through April 19th and surpassed the market again by 0.9 percentage points. Unfortunately ABCL wasn’t nearly as popular as these 30 stocks (hedge fund sentiment was quite bearish); ABCL investors were disappointed as the stock returned -26.3% since the end of December (through 4/19) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 30 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.

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