Last year we predicted the arrival of the first US recession since 2009 and we told in advance that the market will decline by at least 20% in (Recession is Imminent: We Need A Travel Ban NOW). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each stock might be going. In this article, we will take a closer look at hedge fund sentiment towards Immunocore Holdings plc (NASDAQ:IMCR).
Is IMCR a good stock to buy? Hedge funds were becoming hopeful. The number of long hedge fund positions inched up by 17 recently. Immunocore Holdings plc (NASDAQ:IMCR) was in 17 hedge funds’ portfolios at the end of the first quarter of 2021. Our calculations also showed that IMCR isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Kris Jenner of Rock Springs Capital Management
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Do Hedge Funds Think IMCR Is A Good Stock To Buy Now?
At the end of March, a total of 17 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 17 from one quarter earlier. On the other hand, there were a total of 0 hedge funds with a bullish position in IMCR a year ago. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Baker Bros. Advisors was the largest shareholder of Immunocore Holdings plc (NASDAQ:IMCR), with a stake worth $107.3 million reported as of the end of March. Trailing Baker Bros. Advisors was Rock Springs Capital Management, which amassed a stake valued at $97.6 million. Perceptive Advisors, Hillhouse Capital Management, and Millennium Management 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 Rock Springs Capital Management allocated the biggest weight to Immunocore Holdings plc (NASDAQ:IMCR), around 2.13% of its 13F portfolio. Samsara BioCapital is also relatively very bullish on the stock, setting aside 0.63 percent of its 13F equity portfolio to IMCR.
As one would reasonably expect, some big names were breaking ground themselves. Baker Bros. Advisors, managed by Julian Baker and Felix Baker, assembled the most outsized position in Immunocore Holdings plc (NASDAQ:IMCR). Baker Bros. Advisors had $107.3 million invested in the company at the end of the quarter. Kris Jenner, Gordon Bussard, Graham McPhail’s Rock Springs Capital Management also made a $97.6 million investment in the stock during the quarter. The other funds with new positions in the stock are Joseph Edelman’s Perceptive Advisors, Lei Zhang’s Hillhouse Capital Management, and Israel Englander’s Millennium Management.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Immunocore Holdings plc (NASDAQ:IMCR) but similarly valued. We will take a look at Genetron Holdings Limited (NASDAQ:GTH), Repay Holdings Corporation (NASDAQ:RPAY), eHealth, Inc. (NASDAQ:EHTH), Eldorado Gold Corp (NYSE:EGO), Seres Therapeutics Inc (NASDAQ:MCRB), Retail Opportunity Investments Corp (NASDAQ:ROIC), and Harmony Biosciences Holdings, Inc. (NASDAQ:HRMY). This group of stocks’ market values resemble IMCR’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| GTH | 12 | 188265 | -1 |
| RPAY | 15 | 127202 | -5 |
| EHTH | 23 | 473077 | -1 |
| EGO | 16 | 164708 | 2 |
| MCRB | 19 | 390565 | 2 |
| ROIC | 18 | 56076 | 1 |
| HRMY | 10 | 178876 | 2 |
| Average | 16.1 | 225538 | 0 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 16.1 hedge funds with bullish positions and the average amount invested in these stocks was $226 million. That figure was $269 million in IMCR’s case. eHealth, Inc. (NASDAQ:EHTH) is the most popular stock in this table. On the other hand Harmony Biosciences Holdings, Inc. (NASDAQ:HRMY) is the least popular one with only 10 bullish hedge fund positions. Immunocore Holdings plc (NASDAQ:IMCR) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for IMCR is 53.1. 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. 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 28.5% in 2021 through July 23rd and beat the market again by 10.1 percentage points. Unfortunately IMCR wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on IMCR were disappointed as the stock returned -18.8% since the end of March (through 7/23) 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.
Follow Immunocore Holdings Plc
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Disclosure: None. This article was originally published at Insider Monkey.