We at Insider Monkey have gone over 738 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds’ and investors’ portfolio positions as of March 31st. In this article, we look at what those funds think of Amedisys Inc (NASDAQ:AMED) based on that data.
Is Amedisys Inc (NASDAQ:AMED) a splendid stock to buy now? Hedge funds are becoming less confident. The number of bullish hedge fund positions fell by 6 in recent months. Our calculations also showed that amed isn’t among the 30 most popular stocks among hedge funds.
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 flagship best performing hedge funds strategy returned 25.8% year to date (through May 30th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 40 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
Noam Gottesman, GLG Partners
We’re going to check out the recent hedge fund action surrounding Amedisys Inc (NASDAQ:AMED).
What have hedge funds been doing with Amedisys Inc (NASDAQ:AMED)?
Heading into the second quarter of 2019, a total of 26 of the hedge funds tracked by Insider Monkey were long this stock, a change of -19% from one quarter earlier. By comparison, 14 hedge funds held shares or bullish call options in AMED a year ago. With the smart money’s sentiment swirling, there exists a select group of noteworthy hedge fund managers who were adding to their holdings considerably (or already accumulated large positions).
The largest stake in Amedisys Inc (NASDAQ:AMED) was held by D E Shaw, which reported holding $45.7 million worth of stock at the end of March. It was followed by Citadel Investment Group with a $43.8 million position. Other investors bullish on the company included GLG Partners, Two Sigma Advisors, and Millennium Management.
Due to the fact that Amedisys Inc (NASDAQ:AMED) has witnessed falling interest from the aggregate hedge fund industry, we can see that there lies a certain “tier” of funds that slashed their full holdings last quarter. Intriguingly, Benjamin A. Smith’s Laurion Capital Management cut the largest stake of the “upper crust” of funds monitored by Insider Monkey, worth an estimated $31 million in call options. Matthew Hulsizer’s fund, PEAK6 Capital Management, also dumped its call options, about $3.5 million worth. These transactions are interesting, as total hedge fund interest was cut by 6 funds last quarter.
Let’s now review hedge fund activity in other stocks similar to Amedisys Inc (NASDAQ:AMED). We will take a look at IBERIABANK Corporation (NASDAQ:IBKC), Agios Pharmaceuticals Inc (NASDAQ:AGIO), Teladoc Health, Inc. (NYSE:TDOC), and CoreSite Realty Corp (NYSE:COR). This group of stocks’ market valuations match AMED’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| IBKC | 26 | 194750 | 2 |
| AGIO | 22 | 316343 | 5 |
| TDOC | 17 | 166690 | -2 |
| COR | 13 | 226074 | -2 |
| Average | 19.5 | 225964 | 0.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 19.5 hedge funds with bullish positions and the average amount invested in these stocks was $226 million. That figure was $296 million in AMED’s case. IBERIABANK Corporation (NASDAQ:IBKC) is the most popular stock in this table. On the other hand CoreSite Realty Corp (NYSE:COR) is the least popular one with only 13 bullish hedge fund positions. Amedisys Inc (NASDAQ:AMED) is not the most popular stock in this group but hedge fund interest is still above average. 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 20 most popular stocks among hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately AMED wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on AMED were disappointed as the stock returned -8.9% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published at Insider Monkey.
