Is Alexion Pharmaceuticals, Inc. (ALXN) a Good Stock To Buy?

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Due to the fact that Alexion Pharmaceuticals, Inc. (NASDAQ:ALXN) has witnessed declining sentiment from the entirety of the hedge funds we track, it’s safe to say that there was a specific group of hedge funds who were dropping their positions entirely in the third quarter. Interestingly, Jerome Pfund and Michael Sjostrom’s Sectoral Asset Management dumped the largest stake of the “upper crust” of funds monitored by Insider Monkey, worth about $29.3 million in stock. Malcolm Fairbairn’s fund, Ascend Capital, also dropped its stock, about $24.4 million worth.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Alexion Pharmaceuticals, Inc. (NASDAQ:ALXN) but similarly valued. We will take a look at O’Reilly Automotive Inc (NASDAQ:ORLY), Applied Materials, Inc. (NASDAQ:AMAT), Prologis Inc (NYSE:PLD), and V.F. Corporation (NYSE:VFC). This group of stocks’ market valuations are similar to ALXN’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
ORLY 42 1836056 -2
AMAT 57 2527003 10
PLD 17 593703 -6
VFC 22 375429 -1

As you can see these stocks had an average of 35 investors holding bullish positions at the end of the third quarter and the average amount invested in these stocks was $1.33 billion, which is lower than the $2.11 billion in ALXN’s case. Applied Materials, Inc. (NASDAQ:AMAT) is the most popular stock in this table, while Prologis Inc (NYSE:PLD) is the least popular one with only 17 funds reporting ownership. Alexion Pharmaceuticals, Inc. (NASDAQ:ALXN) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard, Applied Materials, Inc. (NASDAQ:AMAT) might be a better candidate to consider a long position in.

Disclosure: None

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