Is LMNX Stock A Buy or Sell?

We at Insider Monkey have gone over 887 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 December 31st. In this article, we look at what those funds think of Luminex Corporation (NASDAQ:LMNX) based on that data.

Is LMNX stock a buy? Luminex Corporation (NASDAQ:LMNX) investors should pay attention to a decrease in hedge fund interest of late. Luminex Corporation (NASDAQ:LMNX) was in 23 hedge funds’ portfolios at the end of December. The all time high for this statistic is 29. Our calculations also showed that LMNX isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).

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Robert Moses of RGM Capital

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

Heading into the first quarter of 2021, a total of 23 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -21% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in LMNX over the last 22 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Among these funds, RGM Capital held the most valuable stake in Luminex Corporation (NASDAQ:LMNX), which was worth $62.5 million at the end of the fourth quarter. On the second spot was Millennium Management which amassed $22.3 million worth of shares. Renaissance Technologies, Ophir Asset Management, and Arrowstreet Capital 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 Ophir Asset Management allocated the biggest weight to Luminex Corporation (NASDAQ:LMNX), around 3.26% of its 13F portfolio. RGM Capital is also relatively very bullish on the stock, earmarking 2.73 percent of its 13F equity portfolio to LMNX.

Since Luminex Corporation (NASDAQ:LMNX) has faced bearish sentiment from the aggregate hedge fund industry, it’s safe to say that there is a sect of funds that elected to cut their full holdings heading into Q1. Interestingly, Jeremy Green’s Redmile Group dropped the biggest position of the 750 funds tracked by Insider Monkey, totaling about $24 million in stock. Robert Joseph Caruso’s fund, Select Equity Group, also sold off its stock, about $23.8 million worth. These transactions are interesting, as aggregate hedge fund interest fell by 6 funds heading into Q1.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Luminex Corporation (NASDAQ:LMNX) but similarly valued. These stocks are The Geo Group, Inc. (NYSE:GEO), Applied Molecular Transport Inc. (NASDAQ:AMTI), Pitney Bowes Inc. (NYSE:PBI), Arcturus Therapeutics Holdings Inc. (NASDAQ:ARCT), IMAX Corporation (NYSE:IMAX), Cango Inc. (NYSE:CANG), and Adverum Biotechnologies, Inc. (NASDAQ:ADVM). All of these stocks’ market caps resemble LMNX’s market cap.

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As you can see these stocks had an average of 15.1 hedge funds with bullish positions and the average amount invested in these stocks was $147 million. That figure was $157 million in LMNX’s case. Adverum Biotechnologies, Inc. (NASDAQ:ADVM) is the most popular stock in this table. On the other hand Cango Inc. (NYSE:CANG) is the least popular one with only 2 bullish hedge fund positions. Luminex Corporation (NASDAQ:LMNX) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for LMNX is 64.8. 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. 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 12.3% in 2021 through April 19th and still beat the market by 0.9 percentage points. Hedge funds were also right about betting on LMNX as the stock returned 59.4% since the end of Q4 (through 4/19) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

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