Is QURE A Good Stock To Buy According To Hedge Funds?

Before we spend countless hours researching a company, we like to analyze what insiders, hedge funds and billionaire investors think of the stock first. This is a necessary first step in our investment process because our research has shown that the elite investors’ consensus returns have been exceptional. In the following paragraphs, we find out what the billionaire investors and hedge funds think of Uniqure NV (NASDAQ:QURE).

Is QURE a good stock to buy? Hedge funds were getting less optimistic. The number of bullish hedge fund positions went down by 13 in recent months. Uniqure NV (NASDAQ:QURE) was in 36 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistic is 49. Our calculations also showed that QURE 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.

Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 66 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.

Paul Marshall Marshall Wace

Paul Marshall of Marshall Wace

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 under the radar cannabis 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. Now let’s take a look at the fresh hedge fund action regarding Uniqure NV (NASDAQ:QURE).

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

At Q3’s end, a total of 36 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -27% from the second quarter of 2020. On the other hand, there were a total of 40 hedge funds with a bullish position in QURE a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).

The largest stake in Uniqure NV (NASDAQ:QURE) was held by Avoro Capital Advisors (venBio Select Advisor), which reported holding $64.5 million worth of stock at the end of September. It was followed by Nantahala Capital Management with a $58.3 million position. Other investors bullish on the company included Marshall Wace LLP, Redmile Group, and Nantahala Capital Management. In terms of the portfolio weights assigned to each position Antara Capital allocated the biggest weight to Uniqure NV (NASDAQ:QURE), around 3.6% of its 13F portfolio. Prosight Capital is also relatively very bullish on the stock, earmarking 3 percent of its 13F equity portfolio to QURE.

Since Uniqure NV (NASDAQ:QURE) has experienced declining sentiment from the entirety of the hedge funds we track, logic holds that there were a few money managers that elected to cut their full holdings by the end of the third quarter. Interestingly, Jerome Pfund and Michael Sjostrom’s Sectoral Asset Management said goodbye to the biggest investment of the “upper crust” of funds watched by Insider Monkey, worth close to $11.3 million in stock, and James A. Silverman’s Opaleye Management was right behind this move, as the fund dropped about $8.5 million worth. These bearish behaviors are interesting, as total hedge fund interest dropped by 13 funds by the end of the third quarter.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Uniqure NV (NASDAQ:QURE) but similarly valued. These stocks are Amarin Corporation plc (NASDAQ:AMRN), Adient plc (NYSE:ADNT), Celsius Holdings, Inc. (NASDAQ:CELH), Hancock Whitney Corporation (NASDAQ:HWC), Steven Madden, Ltd. (NASDAQ:SHOO), 8×8, Inc. (NYSE:EGHT), and United States Steel Corporation (NYSE:X). This group of stocks’ market caps are similar to QURE’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
AMRN 30 299242 -2
ADNT 39 392944 4
CELH 17 65774 7
HWC 23 82566 0
SHOO 23 88372 3
EGHT 22 384327 1
X 21 71985 1
Average 25 197887 2

View table here if you experience formatting issues.

As you can see these stocks had an average of 25 hedge funds with bullish positions and the average amount invested in these stocks was $198 million. That figure was $489 million in QURE’s case. Adient plc (NYSE:ADNT) is the most popular stock in this table. On the other hand Celsius Holdings, Inc. (NASDAQ:CELH) is the least popular one with only 17 bullish hedge fund positions. Uniqure NV (NASDAQ:QURE) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for QURE is 57.2. 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. 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 33.3% in 2020 through December 18th and still beat the market by 16.4 percentage points. Hedge funds were also right about betting on QURE as the stock returned 24.8% since the end of Q3 (through 12/18) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

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