Is ONEM Stock A Buy or Sell?

In this article we will take a look at whether hedge funds think 1Life Healthcare, Inc. (NASDAQ:ONEM) is a good investment right now. We check hedge fund and billionaire investor sentiment before delving into hours of research. Hedge funds spend millions of dollars on Ivy League graduates, unconventional data sources, expert networks, and get tips from investment bankers and industry insiders. Sure they sometimes fail miserably, but their consensus stock picks historically outperformed the market after adjusting for known risk factors.

Is ONEM stock a buy or sell? Prominent investors were betting on the stock. The number of bullish hedge fund bets inched up by 8 in recent months. 1Life Healthcare, Inc. (NASDAQ:ONEM) was in 30 hedge funds’ portfolios at the end of the fourth quarter of 2020. The all time high for this statistic is 22. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that ONEM isn’t among the 30 most popular stocks among hedge funds (click for Q4 rankings).

Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017 (see the details here).

Lee Ainslie of Maverick Capital

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, we heard that billionaire Peter Thiel is backing this psychedelic-drug startup. So, we are taking a closer look at this space. We go through lists like the 10 best biotech stocks under $10 to identify the next stock with 10x upside potential. 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 website. Now let’s take a peek at the key hedge fund action regarding 1Life Healthcare, Inc. (NASDAQ:ONEM).

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

Heading into the first quarter of 2021, a total of 30 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 36% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards ONEM over the last 22 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were adding to their holdings significantly (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Chase Coleman’s Tiger Global Management LLC has the largest position in 1Life Healthcare, Inc. (NASDAQ:ONEM), worth close to $171.5 million, comprising 0.4% of its total 13F portfolio. The second largest stake is held by Maverick Capital, led by Lee Ainslie, holding a $159.8 million position; the fund has 2.6% of its 13F portfolio invested in the stock. Remaining hedge funds and institutional investors with similar optimism consist of Jeremy Green’s Redmile Group, Joel Ramin’s 12 West Capital Management and John Overdeck and David Siegel’s Two Sigma Advisors. In terms of the portfolio weights assigned to each position Maverick Capital allocated the biggest weight to 1Life Healthcare, Inc. (NASDAQ:ONEM), around 2.56% of its 13F portfolio. 12 West Capital Management is also relatively very bullish on the stock, earmarking 1.93 percent of its 13F equity portfolio to ONEM.

Now, some big names were leading the bulls’ herd. Tiger Global Management LLC, managed by Chase Coleman, assembled the biggest position in 1Life Healthcare, Inc. (NASDAQ:ONEM). Tiger Global Management LLC had $171.5 million invested in the company at the end of the quarter. Steve Cohen’s Point72 Asset Management also made a $13.9 million investment in the stock during the quarter. The other funds with brand new ONEM positions are Phill Gross and Robert Atchinson’s Adage Capital Management, Karthik Sarma’s SRS Investment Management, and Frank Fu’s CaaS Capital.

Let’s also examine hedge fund activity in other stocks similar to 1Life Healthcare, Inc. (NASDAQ:ONEM). These stocks are Life Storage, Inc. (NYSE:LSI), BRP Inc. (NASDAQ:DOOO), Columbia Sportswear Company (NASDAQ:COLM), Elbit Systems Ltd. (NASDAQ:ESLT), Halozyme Therapeutics, Inc. (NASDAQ:HALO), Freshpet Inc (NASDAQ:FRPT), and National Instruments Corporation (NASDAQ:NATI). This group of stocks’ market valuations resemble ONEM’s market valuation.

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As you can see these stocks had an average of 17 hedge funds with bullish positions and the average amount invested in these stocks was $154 million. That figure was $787 million in ONEM’s case. Halozyme Therapeutics, Inc. (NASDAQ:HALO) is the most popular stock in this table. On the other hand Elbit Systems Ltd. (NASDAQ:ESLT) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks 1Life Healthcare, Inc. (NASDAQ:ONEM) is more popular among hedge funds. Our overall hedge fund sentiment score for ONEM is 90. 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 12.2% in 2021 through April 12th and still beat the market by 1.5 percentage points. Unfortunately ONEM wasn’t nearly as popular as these 30 stocks and hedge funds that were betting on ONEM were disappointed as the stock returned -4.7% since the end of the fourth quarter (through 4/12) 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 since 2019.

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