Hedge funds are not perfect. They have their bad picks just like everyone else. Facebook, a stock hedge funds have loved, lost nearly 40% of its value at one point in 2018. Although hedge funds are not perfect, their consensus picks do deliver solid returns, however. Our data show the top 15 S&P 500 stocks among hedge funds at the end of December 2018 yielded an average return of 19.7% year-to-date, vs. a gain of 13.1% for the S&P 500 Index. Because hedge funds have a lot of resources and their consensus picks do well, we pay attention to what they think. In this article, we analyze what the elite funds think of Meridian Bioscience, Inc. (NASDAQ:VIVO).
Meridian Bioscience, Inc. (NASDAQ:VIVO) investors should pay attention to an increase in support from the world’s most elite money managers recently. VIVO was in 18 hedge funds’ portfolios at the end of the fourth quarter of 2018. There were 17 hedge funds in our database with VIVO positions at the end of the previous quarter. Our calculations also showed that VIVO isn’t among the 30 most popular stocks among hedge funds.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.5% through March 12, 2019. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Let’s check out the latest hedge fund action encompassing Meridian Bioscience, Inc. (NASDAQ:VIVO).
How have hedgies been trading Meridian Bioscience, Inc. (NASDAQ:VIVO)?
Heading into the first quarter of 2019, a total of 18 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from the previous quarter. The graph below displays the number of hedge funds with bullish position in VIVO over the last 14 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were adding to their holdings substantially (or already accumulated large positions).
Among these funds, Renaissance Technologies held the most valuable stake in Meridian Bioscience, Inc. (NASDAQ:VIVO), which was worth $50.2 million at the end of the fourth quarter. On the second spot was D E Shaw which amassed $6.7 million worth of shares. Moreover, Arrowstreet Capital, Marshall Wace LLP, and Winton Capital Management were also bullish on Meridian Bioscience, Inc. (NASDAQ:VIVO), allocating a large percentage of their portfolios to this stock.
As industrywide interest jumped, key money managers were breaking ground themselves. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, established the most valuable position in Meridian Bioscience, Inc. (NASDAQ:VIVO). Marshall Wace LLP had $4.2 million invested in the company at the end of the quarter. David Harding’s Winton Capital Management also made a $3.7 million investment in the stock during the quarter. The other funds with brand new VIVO positions are Matthew Hulsizer’s PEAK6 Capital Management and Minhua Zhang’s Weld Capital Management.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Meridian Bioscience, Inc. (NASDAQ:VIVO) but similarly valued. We will take a look at Summit Midstream Partners LP (NYSE:SMLP), Enviva Partners, LP (NYSE:EVA), CorePoint Lodging Inc. (NYSE:CPLG), and Movado Group, Inc (NYSE:MOV). This group of stocks’ market values resemble VIVO’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SMLP | 3 | 21424 | 0 |
| EVA | 6 | 39882 | 1 |
| CPLG | 16 | 94089 | -7 |
| MOV | 23 | 64412 | -2 |
| Average | 12 | 54952 | -2 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $55 million. That figure was $90 million in VIVO’s case. Movado Group, Inc (NYSE:MOV) is the most popular stock in this table. On the other hand Summit Midstream Partners LP (NYSE:SMLP) is the least popular one with only 3 bullish hedge fund positions. Meridian Bioscience, Inc. (NASDAQ:VIVO) 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 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Unfortunately VIVO wasn’t nearly as popular as these 15 stock and hedge funds that were betting on VIVO were disappointed as the stock returned -27.1% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.
Disclosure: None. This article was originally published at Insider Monkey.
