Agnico Eagle Mines Limited (AEM): Hedge Funds Are Snapping Up

With the second-quarter round of 13F filings behind us it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the third quarter of 2021. One of these stocks was Agnico Eagle Mines Limited (NYSE:AEM).

Agnico Eagle Mines Limited (NYSE:AEM) investors should pay attention to an increase in hedge fund interest recently. Agnico Eagle Mines Limited (NYSE:AEM) was in 29 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 36. There were 28 hedge funds in our database with AEM holdings at the end of March. Our calculations also showed that AEM isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

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. Hedge funds have more than $3.5 trillion in assets under management, so you can’t expect their entire portfolios to beat the market by large margins. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 79 percentage points since March 2017 (see the details here). So you can still find a lot of gems by following hedge funds’ moves today.

Eric Sprott of Sprott Asset Management

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. 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. 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 homepage. Keeping this in mind we’re going to take a look at the key hedge fund action surrounding Agnico Eagle Mines Limited (NYSE:AEM).

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

At Q2’s end, a total of 29 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 4% from one quarter earlier. By comparison, 30 hedge funds held shares or bullish call options in AEM a year ago. With the smart money’s sentiment swirling, there exists a few notable hedge fund managers who were upping their stakes substantially (or already accumulated large positions).

Among these funds, Renaissance Technologies held the most valuable stake in Agnico Eagle Mines Limited (NYSE:AEM), which was worth $111.4 million at the end of the second quarter. On the second spot was Sprott Asset Management which amassed $39.7 million worth of shares. Citadel Investment Group, Citadel Investment Group, and D E Shaw were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Sprott Asset Management allocated the biggest weight to Agnico Eagle Mines Limited (NYSE:AEM), around 2.32% of its 13F portfolio. Amitell Capital is also relatively very bullish on the stock, designating 1.26 percent of its 13F equity portfolio to AEM.

As one would reasonably expect, specific money managers have been driving this bullishness. Schonfeld Strategic Advisors, managed by Ryan Tolkin (CIO), created the biggest position in Agnico Eagle Mines Limited (NYSE:AEM). Schonfeld Strategic Advisors had $2.3 million invested in the company at the end of the quarter. Mark Broach’s Manatuck Hill Partners also initiated a $1.4 million position during the quarter. The other funds with new positions in the stock are Frank Fu’s CaaS Capital, Karim Abbadi and Edward McBride’s Centiva Capital, and Alec Litowitz and Ross Laser’s Magnetar Capital.

Let’s also examine hedge fund activity in other stocks similar to Agnico Eagle Mines Limited (NYSE:AEM). These stocks are GDS Holdings Limited (NASDAQ:GDS), Godaddy Inc (NYSE:GDDY), Citrix Systems, Inc. (NASDAQ:CTXS), UDR, Inc. (NYSE:UDR), Fair Isaac Corporation (NYSE:FICO), Apollo Global Management Inc (NYSE:APO), and Shaw Communications Inc (NYSE:SJR). All of these stocks’ market caps resemble AEM’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 30.3 hedge funds with bullish positions and the average amount invested in these stocks was $1411 million. That figure was $236 million in AEM’s case. Godaddy Inc (NYSE:GDDY) is the most popular stock in this table. On the other hand Citrix Systems, Inc. (NASDAQ:CTXS) is the least popular one with only 23 bullish hedge fund positions. Agnico Eagle Mines Limited (NYSE:AEM) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for AEM is 48.9. 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 24.9% in 2021 through October 15th and surpassed the market again by 4.5 percentage points. Unfortunately AEM wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); AEM investors were disappointed as the stock returned -4.4% since the end of June (through 10/15) 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 most of these stocks already outperformed the market in 2021.

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