Many prominent investors, including Warren Buffett, David Tepper and Stan Druckenmiller, have been cautious regarding the current bull market and missed out as the stock market reached another high in recent weeks. On the other hand, technology hedge funds weren’t timid and registered double digit market beating gains. Financials, energy and industrial stocks initially suffered the most but many of these stocks delivered strong returns since November and hedge funds actually increased their positions in these stocks. In this article we will find out how hedge fund sentiment towards Repligen Corporation (NASDAQ:RGEN) changed recently.
Repligen Corporation (NASDAQ:RGEN) was in 35 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 38. RGEN investors should pay attention to a decrease in activity from the world’s largest hedge funds of late. There were 38 hedge funds in our database with RGEN positions at the end of the first quarter. Our calculations also showed that RGEN isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s monthly stock picks returned 185.4% since March 2017 and outperformed the S&P 500 ETFs by more than 79 percentage points (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
Steven Cohen of Point72 Asset Management
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, we like undervalued, EBITDA-positive growth stocks, so we are checking out stock pitches like this emerging biotech 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 let’s take a look at the latest hedge fund action surrounding Repligen Corporation (NASDAQ:RGEN).
Do Hedge Funds Think RGEN Is A Good Stock To Buy Now?
At the end of the second quarter, a total of 35 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -8% from the first quarter of 2020. By comparison, 34 hedge funds held shares or bullish call options in RGEN a year ago. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Repligen Corporation (NASDAQ:RGEN) was held by Select Equity Group, which reported holding $258.5 million worth of stock at the end of June. It was followed by 12 West Capital Management with a $214.6 million position. Other investors bullish on the company included Impax Asset Management, Marshall Wace LLP, and Point72 Asset Management. In terms of the portfolio weights assigned to each position 12 West Capital Management allocated the biggest weight to Repligen Corporation (NASDAQ:RGEN), around 9% of its 13F portfolio. Miura Global Management is also relatively very bullish on the stock, dishing out 3.02 percent of its 13F equity portfolio to RGEN.
Since Repligen Corporation (NASDAQ:RGEN) has witnessed bearish sentiment from the aggregate hedge fund industry, logic holds that there lies a certain “tier” of hedgies that slashed their full holdings heading into Q3. Intriguingly, Ken Griffin’s Citadel Investment Group said goodbye to the largest investment of the 750 funds followed by Insider Monkey, totaling about $4.4 million in stock, and Michael Gelband’s ExodusPoint Capital was right behind this move, as the fund said goodbye to about $2.1 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest dropped by 3 funds heading into Q3.
Let’s now review hedge fund activity in other stocks similar to Repligen Corporation (NASDAQ:RGEN). We will take a look at ICON Public Limited Company (NASDAQ:ICLR), Magellan Midstream Partners, L.P. (NYSE:MMP), Teva Pharmaceutical Industries Limited (NYSE:TEVA), Regency Centers Corp (NYSE:REG), Norwegian Cruise Line Holdings Ltd (NASDAQ:NCLH), Five Below Inc (NASDAQ:FIVE), and LPL Financial Holdings Inc (NASDAQ:LPLA). This group of stocks’ market caps resemble RGEN’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ICLR | 39 | 1301455 | 10 |
| MMP | 13 | 89137 | -1 |
| TEVA | 22 | 947100 | -2 |
| REG | 25 | 192591 | 8 |
| NCLH | 43 | 606617 | 9 |
| FIVE | 42 | 783248 | -1 |
| LPLA | 48 | 1500930 | 10 |
| Average | 33.1 | 774440 | 4.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 33.1 hedge funds with bullish positions and the average amount invested in these stocks was $774 million. That figure was $1285 million in RGEN’s case. LPL Financial Holdings Inc (NASDAQ:LPLA) is the most popular stock in this table. On the other hand Magellan Midstream Partners, L.P. (NYSE:MMP) is the least popular one with only 13 bullish hedge fund positions. Repligen Corporation (NASDAQ:RGEN) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for RGEN is 61.1. 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 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 21.8% in 2021 through October 11th and still beat the market by 4.4 percentage points. Hedge funds were also right about betting on RGEN as the stock returned 27.1% since the end of Q2 (through 10/11) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Follow Repligen Corp (NASDAQ:RGEN)
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Disclosure: None. This article was originally published at Insider Monkey.
