The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 887 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of December 31st. In this article we look at what those investors think of Intuitive Surgical, Inc. (NASDAQ:ISRG).
Is ISRG stock a buy or sell? Intuitive Surgical, Inc. (NASDAQ:ISRG) investors should be aware of a decrease in enthusiasm from smart money of late. Intuitive Surgical, Inc. (NASDAQ:ISRG) was in 49 hedge funds’ portfolios at the end of December. The all time high for this statistic is 51. Our calculations also showed that ISRG isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).
In today’s marketplace there are plenty of indicators investors can use to evaluate publicly traded companies. A couple of the most useful indicators are hedge fund and insider trading sentiment. Our experts have shown that, historically, those who follow the best picks of the top investment managers can beat the market by a superb amount (see the details here).
Kris Jenner of Rock Springs Capital Management
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best hydrogen fuel cell 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 (or at the end of this article). Now we’re going to take a gander at the recent hedge fund action encompassing Intuitive Surgical, Inc. (NASDAQ:ISRG).
Do Hedge Funds Think ISRG Is A Good Stock To Buy Now?
At Q4’s end, a total of 49 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -2% from the third quarter of 2020. By comparison, 51 hedge funds held shares or bullish call options in ISRG a year ago. With hedgies’ sentiment swirling, there exists a few noteworthy hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Fisher Asset Management, managed by Ken Fisher, holds the most valuable position in Intuitive Surgical, Inc. (NASDAQ:ISRG). Fisher Asset Management has a $1.0009 billion position in the stock, comprising 0.7% of its 13F portfolio. The second most bullish fund manager is AQR Capital Management, led by Cliff Asness, holding a $108 million position; 0.2% of its 13F portfolio is allocated to the company. Remaining hedge funds and institutional investors that are bullish contain Kris Jenner, Gordon Bussard, Graham McPhail’s Rock Springs Capital Management, Phill Gross and Robert Atchinson’s Adage Capital Management and OrbiMed Advisors. In terms of the portfolio weights assigned to each position Unio Capital allocated the biggest weight to Intuitive Surgical, Inc. (NASDAQ:ISRG), around 4.11% of its 13F portfolio. Rock Springs Capital Management is also relatively very bullish on the stock, earmarking 2.08 percent of its 13F equity portfolio to ISRG.
Due to the fact that Intuitive Surgical, Inc. (NASDAQ:ISRG) has witnessed declining sentiment from the smart money, it’s easy to see that there was a specific group of hedge funds that elected to cut their positions entirely by the end of the fourth quarter. Interestingly, Benjamin A. Smith’s Laurion Capital Management dumped the largest investment of all the hedgies monitored by Insider Monkey, comprising close to $11.6 million in stock, and Joe DiMenna’s ZWEIG DIMENNA PARTNERS was right behind this move, as the fund dropped about $8.1 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest fell by 1 funds by the end of the fourth quarter.
Let’s also examine hedge fund activity in other stocks similar to Intuitive Surgical, Inc. (NASDAQ:ISRG). These stocks are General Electric Company (NYSE:GE), Rio Tinto Group (NYSE:RIO), Diageo plc (NYSE:DEO), GlaxoSmithKline plc (NYSE:GSK), Stryker Corporation (NYSE:SYK), Booking Holdings Inc. (NASDAQ:BKNG), and Goldman Sachs Group, Inc. (NYSE:GS). This group of stocks’ market caps are similar to ISRG’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| GE | 69 | 5684620 | 24 |
| RIO | 26 | 1711997 | 3 |
| DEO | 23 | 667041 | 4 |
| GSK | 30 | 1742036 | -1 |
| SYK | 44 | 3222907 | -4 |
| BKNG | 108 | 8247434 | -5 |
| GS | 76 | 4607743 | 6 |
| Average | 53.7 | 3697683 | 3.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 53.7 hedge funds with bullish positions and the average amount invested in these stocks was $3698 million. That figure was $1802 million in ISRG’s case. Booking Holdings Inc. (NASDAQ:BKNG) is the most popular stock in this table. On the other hand Diageo plc (NYSE:DEO) is the least popular one with only 23 bullish hedge fund positions. Intuitive Surgical, Inc. (NASDAQ:ISRG) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for ISRG is 48.1. 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 negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 30 most popular stocks among hedge funds returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 5.3% in 2021 through March 19th and surpassed the market again by 0.8 percentage points. Unfortunately ISRG wasn’t nearly as popular as these 30 stocks (hedge fund sentiment was quite bearish); ISRG investors were disappointed as the stock returned -13.5% since the end of December (through 3/19) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 30 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
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Disclosure: None. This article was originally published at Insider Monkey.
