Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the third quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 6 years and analyze what the smart money thinks of Roper Technologies Inc. (NYSE:ROP) based on that data and determine whether they were really smart about the stock.
Roper Technologies Inc. (NYSE:ROP) shareholders have witnessed an increase in hedge fund sentiment in recent months. Roper Technologies Inc. (NYSE:ROP) was in 45 hedge funds’ portfolios at the end of September. The all time high for this statistic is 50. There were 41 hedge funds in our database with ROP positions at the end of the second quarter. Our calculations also showed that ROP isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
Michael Gelband of ExodusPoint Capital
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. Keeping this in mind let’s analyze the fresh hedge fund action surrounding Roper Technologies Inc. (NYSE:ROP).
Do Hedge Funds Think ROP Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 45 of the hedge funds tracked by Insider Monkey were long this stock, a change of 10% from the second quarter of 2021. On the other hand, there were a total of 50 hedge funds with a bullish position in ROP a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Roper Technologies Inc. (NYSE:ROP) was held by Akre Capital Management, which reported holding $741.7 million worth of stock at the end of September. It was followed by Citadel Investment Group with a $201.9 million position. Other investors bullish on the company included Echo Street Capital Management, D E Shaw, and Bristol Gate Capital Partners. In terms of the portfolio weights assigned to each position Lansing Management allocated the biggest weight to Roper Technologies Inc. (NYSE:ROP), around 11.82% of its 13F portfolio. Akre Capital Management is also relatively very bullish on the stock, setting aside 4.57 percent of its 13F equity portfolio to ROP.
Now, key money managers were breaking ground themselves. Kingdon Capital, managed by Mark Kingdon, established the largest position in Roper Technologies Inc. (NYSE:ROP). Kingdon Capital had $9.2 million invested in the company at the end of the quarter. Michael Gelband’s ExodusPoint Capital also initiated a $5.4 million position during the quarter. The other funds with new positions in the stock are Alec Litowitz and Ross Laser’s Magnetar Capital, Ran Pang’s Quantamental Technologies, and Jinghua Yan’s TwinBeech Capital.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Roper Technologies Inc. (NYSE:ROP) but similarly valued. We will take a look at Monster Beverage Corp (NASDAQ:MNST), EOG Resources Inc (NYSE:EOG), Palo Alto Networks Inc (NYSE:PANW), IHS Markit Ltd. (NASDAQ:INFO), Global Payments Inc (NYSE:GPN), IQVIA Holdings, Inc. (NYSE:IQV), and Synopsys, Inc. (NASDAQ:SNPS). This group of stocks’ market caps resemble ROP’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| MNST | 42 | 2134498 | -4 |
| EOG | 47 | 1024547 | 12 |
| PANW | 73 | 5899838 | 4 |
| INFO | 64 | 6723219 | 3 |
| GPN | 68 | 3462603 | 2 |
| IQV | 66 | 3756655 | -3 |
| SNPS | 43 | 2343901 | 2 |
| Average | 57.6 | 3620752 | 2.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 57.6 hedge funds with bullish positions and the average amount invested in these stocks was $3621 million. That figure was $1667 million in ROP’s case. Palo Alto Networks Inc (NYSE:PANW) is the most popular stock in this table. On the other hand Monster Beverage Corp (NASDAQ:MNST) is the least popular one with only 42 bullish hedge fund positions. Roper Technologies Inc. (NYSE:ROP) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for ROP is 40.8. 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 negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 29.6% in 2021 and surpassed the market again by 3.6 percentage points. Unfortunately, ROP wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); ROP investors were disappointed as the stock returned -1.8% since the end of September (through 1/31) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as all of these stocks already outperformed the market since 2019.
Follow Roper Technologies Inc (NYSE:ROP)
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Disclosure: None. This article was originally published at Insider Monkey.
