Polen Capital Management, LLC, an independently-owned global investment manager, recently published its first-quarter focus growth commentary – a copy of which can be downloaded here. During the first quarter of 2020, the Polen Focus Growth Composite Portfolio returned -13.03% gross of fees, while the Russell 1000 Growth and S&P 500 indices were down 14.10% and 19.60%, respectively.
In the said letter, Polen Capital highlighted a few stocks and Regeneron Pharmaceuticals Inc. (NASDAQ:REGN) is one of them. Regeneron Pharmaceuticals is a biotechnology company based in New York. Year-to-date, REGN stock gained 43.1% and on April 27th it had a closing price of $547.52. Its market cap is of $59.1 billion. Here is what Polen Capital said:
“Regeneron Pharmaceuticals appreciated 30% in a challenging quarter. In recent years, concerns over increased competition for Eylea, Regeneron’s most significant drug, have weighed on shares. Early in the quarter, however, a competitor warned that its alternative to Eylea could potentially cause serious side effects, pushing Regeneron stock higher. From our perspective, this news highlights the difficulty in bringing safe eye care drugs to market and potentially extends the period of little competition for Eylea. Shares also received a boost when the firm announced it had identified several potential antibodies that could become the first effective preventative therapy for COVID-19 and that one of its existing products, Kevzara, could potentially be used to treat already sick COVID-19 patients. Regeneron was a strong performer in the first quarter, partly due to potentially premature COVID-19 enthusiasm (although this news helps demonstrate the strength of Regeneron’s drug development platform). We will continue to weigh the strength of Regeneron’s existing product portfolio and its differentiated drug discovery platform against some of the future headwinds the company could face.”
In Q4 2019, the number of bullish hedge fund positions on REGN stock increased by about 6% from the previous quarter (see the chart here).
Polen Capital’s comments on MSCI
In the said letter, Polen Capital also highlighted MSCI Inc. (NYSE:MSCI) stock. MSCI is a finance company based in New York. Here is what Polen Capital said:
“MSCI also appreciated by double-digits in the first quarter. MSCI is mostly insulated from equity market gyrations because 90% of its revenue is recurring and subscription-based. Also, the company can flex its expense structure in periods of stress. We believe MSCI offers a level of stability similar to our software and services businesses, which have highly recurring revenue, strong customer lock-in, and very little client attrition even in tough times.”
Disclosure: None. This article is originally published at Insider Monkey.
