We are still in an overall bull market and many stocks that smart money investors were piling into surged through the end of November. Among them, Facebook and Microsoft ranked among the top 3 picks and these stocks gained 54% and 51% respectively. Hedge funds’ top 3 stock picks returned 41.7% this year and beat the S&P 500 ETFs by 14 percentage points. Investing in index funds guarantees you average returns, not superior returns. We are looking to generate superior returns for our readers. That’s why we believe it isn’t a waste of time to check out hedge fund sentiment before you invest in a stock like OraSure Technologies, Inc. (NASDAQ:OSUR).
OraSure Technologies, Inc. (NASDAQ:OSUR) has experienced an increase in enthusiasm from smart money of late. OSUR was in 19 hedge funds’ portfolios at the end of the third quarter of 2019. There were 17 hedge funds in our database with OSUR holdings at the end of the previous quarter. Our calculations also showed that OSUR isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
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 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 Russell 2000 ETFs by 40 percentage points since May 2014 (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 27.8% through November 21, 2019. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Ken Griffin of Citadel Investment Group
Unlike the largest US hedge funds that are convinced Dow will soar past 40,000 or the world’s most bearish hedge fund that’s more convinced than ever that a crash is coming, our long-short investment strategy doesn’t rely on bull or bear markets to deliver double digit returns. We only rely on the best performing hedge funds‘ buy/sell signals. We’re going to take a look at the fresh hedge fund action surrounding OraSure Technologies, Inc. (NASDAQ:OSUR).
How have hedgies been trading OraSure Technologies, Inc. (NASDAQ:OSUR)?
At Q3’s end, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of 12% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in OSUR over the last 17 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey’s hedge fund database, Renaissance Technologies, holds the biggest position in OraSure Technologies, Inc. (NASDAQ:OSUR). Renaissance Technologies has a $34.5 million position in the stock, comprising less than 0.1%% of its 13F portfolio. The second most bullish fund manager is David E. Shaw of D E Shaw, with a $22.7 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Other peers that hold long positions include Constantinos J. Christofilis’s Archon Capital Management, Ken Griffin’s Citadel Investment Group and John Overdeck and David Siegel’s Two Sigma Advisors. In terms of the portfolio weights assigned to each position Archon Capital Management allocated the biggest weight to OraSure Technologies, Inc. (NASDAQ:OSUR), around 1.1% of its 13F portfolio. Factorial Partners is also relatively very bullish on the stock, setting aside 0.65 percent of its 13F equity portfolio to OSUR.
With a general bullishness amongst the heavyweights, some big names were breaking ground themselves. Factorial Partners, managed by Mark Kleiman, initiated the most valuable position in OraSure Technologies, Inc. (NASDAQ:OSUR). Factorial Partners had $0.7 million invested in the company at the end of the quarter. Andrew Weiss’s Weiss Asset Management also made a $0.1 million investment in the stock during the quarter.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as OraSure Technologies, Inc. (NASDAQ:OSUR) but similarly valued. We will take a look at Capital City Bank Group, Inc. (NASDAQ:CCBG), Sinovac Biotech Ltd. (NASDAQ:SVA), Stemline Therapeutics Inc (NASDAQ:STML), and Aurora Mobile Limited (NASDAQ:JG). All of these stocks’ market caps match OSUR’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CCBG | 3 | 8944 | 0 |
| SVA | 3 | 70156 | 0 |
| STML | 18 | 161684 | 1 |
| JG | 1 | 77 | 0 |
| Average | 6.25 | 60215 | 0.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 6.25 hedge funds with bullish positions and the average amount invested in these stocks was $60 million. That figure was $82 million in OSUR’s case. Stemline Therapeutics Inc (NASDAQ:STML) is the most popular stock in this table. On the other hand Aurora Mobile Limited (NASDAQ:JG) is the least popular one with only 1 bullish hedge fund positions. Compared to these stocks OraSure Technologies, Inc. (NASDAQ:OSUR) is more popular among hedge funds. Our calculations showed that top 20 most popular stocks among hedge funds returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Hedge funds were also right about betting on OSUR, though not to the same extent, as the stock returned 8.4% during the fourth quarter (through the end of November) and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.
