Hedge Funds Are Piling Into AMN Healthcare Services Inc (AMN)

We know that hedge funds generate strong, risk-adjusted returns over the long run, therefore imitating the picks that they are collectively bullish on can be a profitable strategy for retail investors. With billions of dollars in assets, smart money investors have to conduct complex analyses, spend many resources and use tools that are not always available for the general crowd. This doesn’t mean that they don’t have occasional colossal losses; they do (like Melvin Capital’s recent GameStop losses). However, it is still a good idea to keep an eye on hedge fund activity. With this in mind, as the current round of 13F filings has just ended, let’s examine the smart money sentiment towards AMN Healthcare Services Inc (NYSE:AMN).

AMN Healthcare Services Inc (NYSE:AMN) was in 26 hedge funds’ portfolios at the end of September. The all time high for this statistic was previously 24. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. AMN investors should pay attention to an increase in hedge fund sentiment lately. There were 24 hedge funds in our database with AMN positions at the end of the second quarter. Our calculations also showed that AMN isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).

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. Now let’s go over the key hedge fund action regarding AMN Healthcare Services Inc (NYSE:AMN).

Peter Rathjens of Arrowstreet Capital

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

Heading into the fourth quarter of 2021, a total of 26 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 8% from the second quarter of 2021. The graph below displays the number of hedge funds with bullish position in AMN over the last 25 quarters. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).

The largest stake in AMN Healthcare Services Inc (NYSE:AMN) was held by Millennium Management, which reported holding $83 million worth of stock at the end of September. It was followed by Driehaus Capital with a $57.9 million position. Other investors bullish on the company included Pura Vida Investments, Arrowstreet Capital, and Balyasny Asset Management. In terms of the portfolio weights assigned to each position Navellier & Associates allocated the biggest weight to AMN Healthcare Services Inc (NYSE:AMN), around 1.68% of its 13F portfolio. Pura Vida Investments is also relatively very bullish on the stock, earmarking 1.05 percent of its 13F equity portfolio to AMN.

With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Pura Vida Investments, managed by Efrem Kamen, initiated the most valuable call position in AMN Healthcare Services Inc (NYSE:AMN). Pura Vida Investments had $34.4 million invested in the company at the end of the quarter. Efrem Kamen’s Pura Vida Investments also made a $9.2 million investment in the stock during the quarter. The other funds with new positions in the stock are Richard SchimeláandáLawrence Sapanski’s Cinctive Capital Management, John Overdeck and David Siegel’s Two Sigma Advisors, and Michael Rockefeller and KarláKroeker’s Woodline Partners.

Let’s check out hedge fund activity in other stocks similar to AMN Healthcare Services Inc (NYSE:AMN). We will take a look at Helen of Troy Limited (NASDAQ:HELE), Valley National Bancorp (NASDAQ:VLY), PacWest Bancorp (NASDAQ:PACW), Ashland Global Holdings Inc.. (NYSE:ASH), Healthequity Inc (NASDAQ:HQY), Mister Car Wash Inc. (NYSE:MCW), and International Game Technology PLC (NYSE:IGT). This group of stocks’ market caps match AMN’s market cap.

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As you can see these stocks had an average of 25.7 hedge funds with bullish positions and the average amount invested in these stocks was $969 million. That figure was $258 million in AMN’s case. International Game Technology PLC (NYSE:IGT) is the most popular stock in this table. On the other hand Helen of Troy Limited (NASDAQ:HELE) is the least popular one with only 15 bullish hedge fund positions. AMN Healthcare Services Inc (NYSE:AMN) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for AMN is 63.2. 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. This is a slightly positive signal but 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 31.1% in 2021 through December 9th and beat the market again by 5.1 percentage points. Unfortunately AMN wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on AMN were disappointed as the stock returned -3.5% since the end of September (through 12/9) 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 many of these stocks already outperformed the market since 2019.

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