Is Charles River Laboratories (CRL) a Smart Long-term Buy?

Brown Capital Management Mid Company Fund recently released its Q3 2020 Investor Letter, a copy of which you can download here. The fund posted a return of 6.15% (inst. class) for the quarter, underperforming its benchmark, the Russell Midcap Growth Index which returned 9.4% in the same quarter. You should check out Brown Capital Management’s top 5 stock picks for investors to buy right now, which could be the biggest winners of 2021.

In the Q3 2020 Investor Letter, Brown Capital Management highlighted a few stocks and Charles River Laboratories International Inc. (NYSE:CRL) is one of them. Charles River Laboratories International Inc. (NYSE:CRL) is a clinical laboratory company. Year-to-date, Charles River Laboratories International Inc. (NYSE:CRL) stock gained 59.1% and on December 15th it had a closing price of $243.08. Here is what Brown Capital Management said:

“Charles River Laboratories is an essential products and services provider to the global pharmaceutical and biotechnology industries. In 2019, Charles River was involved in 85% of the drugs approved by the FDA. Through its three primary business units, the company produces drug-research models, conducts drug-safety trials and discovery services, and sells supplies for manufacturing biologic compounds and testing them for impurities. Charles River’s research-models business is the industry’s market-share leader. The biotechnology industry’s increased emphasis on rare diseases is a secular tailwind to Charles River’s three business lines.

The company began 2020 like many businesses, mired in uncertainty regarding how COVID-19 would impact its clients and its profitability. During the company’s August earnings report and business update, management raised its sales and earnings outlook above expectations. Reflecting the essential need for its products to make life-saving drugs and to conduct crucial drug-safety trials, Charles River’s clients have been rapidly bringing employees back to work. Following the recent share-price strength, we continue to believe that the company’s industry dominance offers attractive near-term profitability, while its unique ability to serve the fast-growing biotechnology industry should offer many years of growth.”


In Q2 2020, the number of bullish hedge fund positions on Charles River Laboratories International Inc. (NYSE:CRL) stock increased by about 14% from the previous quarter (see the chart here), so a number of other hedge fund managers believe in CRL’s growth potential. Our calculations showed that Charles River Laboratories International Inc. (NYSE:CRL) isn’t ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 216% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 121 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. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. 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:

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