The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 817 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their September 30 holdings, data that is available nowhere else. Should you consider Quidel Corporation (NASDAQ:QDEL) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
Is QDEL a good stock to buy now? Investors who are in the know were betting on the stock. The number of long hedge fund bets increased by 10 in recent months. Quidel Corporation (NASDAQ:QDEL) was in 42 hedge funds’ portfolios at the end of September. The all time high for this statistic is 32. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that QDEL isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
If you’d ask most market participants, hedge funds are viewed as underperforming, outdated financial vehicles of years past. While there are greater than 8000 funds with their doors open today, We choose to focus on the masters of this club, about 850 funds. Most estimates calculate that this group of people direct the majority of the hedge fund industry’s total asset base, and by observing their highest performing stock picks, Insider Monkey has formulated various investment strategies that have historically outstripped Mr. Market. Insider Monkey’s flagship short hedge fund strategy surpassed the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Our portfolio of short stocks lost 13% since February 2017 (through November 17th) even though the market was up 65% during the same period. We just shared a list of 6 short targets in our latest quarterly update .
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the House passed a landmark bill decriminalizing marijuana. So, we are checking out this cannabis tech stock right now. We go through lists like the 15 best blue chip stocks to buy 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. Keeping this in mind we’re going to take a look at the new hedge fund action surrounding Quidel Corporation (NASDAQ:QDEL).
Do Hedge Funds Think QDEL Is A Good Stock To Buy Now?
At the end of September, a total of 42 of the hedge funds tracked by Insider Monkey were long this stock, a change of 31% from the second quarter of 2020. The graph below displays the number of hedge funds with bullish position in QDEL over the last 21 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, holds the most valuable position in Quidel Corporation (NASDAQ:QDEL). Arrowstreet Capital has a $95 million position in the stock, comprising 0.2% of its 13F portfolio. The second largest stake is held by GAMCO Investors, managed by Mario Gabelli, which holds a $64.6 million position; the fund has 0.7% of its 13F portfolio invested in the stock. Some other members of the smart money that hold long positions contain Brandon Haley’s Holocene Advisors, Steve Cohen’s Point72 Asset Management and Israel Englander’s Millennium Management. In terms of the portfolio weights assigned to each position Birchview Capital allocated the biggest weight to Quidel Corporation (NASDAQ:QDEL), around 8.6% of its 13F portfolio. Trellus Management Company is also relatively very bullish on the stock, setting aside 4.27 percent of its 13F equity portfolio to QDEL.
As aggregate interest increased, specific money managers were leading the bulls’ herd. Point72 Asset Management, managed by Steve Cohen, established the biggest position in Quidel Corporation (NASDAQ:QDEL). Point72 Asset Management had $31.1 million invested in the company at the end of the quarter. James E. Flynn’s Deerfield Management also initiated a $28.6 million position during the quarter. The other funds with new positions in the stock are Phill Gross and Robert Atchinson’s Adage Capital Management, Richard Mashaal’s Rima Senvest Management, and Zachary Miller’s Parian Global Management.
Let’s go over hedge fund activity in other stocks similar to Quidel Corporation (NASDAQ:QDEL). We will take a look at Bright Horizons Family Solutions Inc (NYSE:BFAM), Carnival Corporation & plc (NYSE:CUK), Chegg Inc (NYSE:CHGG), Fidelity National Financial Inc (NYSE:FNF), Allegion plc (NYSE:ALLE), Universal Health Services, Inc. (NYSE:UHS), and IPG Photonics Corporation (NASDAQ:IPGP). This group of stocks’ market values are closest to QDEL’s market value.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 30.7 hedge funds with bullish positions and the average amount invested in these stocks was $511 million. That figure was $467 million in QDEL’s case. Fidelity National Financial Inc (NYSE:FNF) is the most popular stock in this table. On the other hand Carnival Corporation & plc (NYSE:CUK) is the least popular one with only 13 bullish hedge fund positions. Quidel Corporation (NASDAQ:QDEL) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for QDEL is 86.8. 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 positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 32.9% in 2020 through December 8th and beat the market again by 16.2 percentage points. Unfortunately QDEL wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on QDEL were disappointed as the stock returned -10.9% since the end of September (through 12/8) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
Disclosure: None. This article was originally published at Insider Monkey.