Is QGEN Stock A Buy or Sell?

Many prominent investors, including Warren Buffett, David Tepper and Stan Druckenmiller, have been cautious regarding the current bull market and missed out as the stock market reached another high in recent weeks. On the other hand, technology hedge funds weren’t timid and registered double digit market beating gains. Financials, energy and industrial stocks initially suffered the most but many of these stocks delivered strong returns since November and hedge funds actually increased their positions in these stocks. In this article we will find out how hedge fund sentiment towards Qiagen NV (NYSE:QGEN) changed recently.

Is QGEN stock a buy? Qiagen NV (NYSE:QGEN) was in 24 hedge funds’ portfolios at the end of the fourth quarter of 2020. The all time high for this statistic is 51. QGEN has seen a decrease in hedge fund sentiment recently. There were 29 hedge funds in our database with QGEN holdings at the end of September. Our calculations also showed that QGEN isn’t among the 30 most popular stocks among hedge funds (click for Q4 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 124 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.

David E. Shaw of D.E. Shaw

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, auto parts business is a recession resistant business, so we are taking a closer look at this discount auto parts stock that is growing at a 196% annualized rate. We go through lists like the 15 best micro-cap stocks to buy now 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. Keeping this in mind we’re going to take a look at the new hedge fund action regarding Qiagen NV (NYSE:QGEN).

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

At Q4’s end, a total of 24 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -17% from the previous quarter. The graph below displays the number of hedge funds with bullish position in QGEN over the last 22 quarters. With the smart money’s sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).

The largest stake in Qiagen NV (NYSE:QGEN) was held by Millennium Management, which reported holding $226.1 million worth of stock at the end of December. It was followed by Farallon Capital with a $172.1 million position. Other investors bullish on the company included Two Sigma Advisors, Arrowstreet Capital, and D E Shaw. In terms of the portfolio weights assigned to each position Eversept Partners allocated the biggest weight to Qiagen NV (NYSE:QGEN), around 2.12% of its 13F portfolio. Chescapmanager LLC is also relatively very bullish on the stock, earmarking 1.48 percent of its 13F equity portfolio to QGEN.

Seeing as Qiagen NV (NYSE:QGEN) has witnessed falling interest from the smart money, we can see that there were a few money managers that slashed their entire stakes last quarter. It’s worth mentioning that John Paulson’s Paulson & Co sold off the biggest investment of the 750 funds monitored by Insider Monkey, valued at an estimated $20.8 million in stock, and Dmitry Balyasny’s Balyasny Asset Management was right behind this move, as the fund sold off about $20.7 million worth. These transactions are intriguing to say the least, as total hedge fund interest was cut by 5 funds last quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Qiagen NV (NYSE:QGEN) but similarly valued. These stocks are Atmos Energy Corporation (NYSE:ATO), Booz Allen Hamilton Holding Corporation (NYSE:BAH), PPD, Inc. (NASDAQ:PPD), IPG Photonics Corporation (NASDAQ:IPGP), Sibanye Stillwater Limited (NYSE:SBSW), Fortune Brands Home & Security Inc (NYSE:FBHS), and InterContinental Hotels Group PLC (NYSE:IHG). This group of stocks’ market valuations resemble QGEN’s market valuation.

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As you can see these stocks had an average of 22.9 hedge funds with bullish positions and the average amount invested in these stocks was $350 million. That figure was $670 million in QGEN’s case. Fortune Brands Home & Security Inc (NYSE:FBHS) is the most popular stock in this table. On the other hand InterContinental Hotels Group PLC (NYSE:IHG) is the least popular one with only 7 bullish hedge fund positions. Qiagen NV (NYSE:QGEN) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for QGEN is 51.1. 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 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 beat the market again by 0.9 percentage points. Unfortunately QGEN wasn’t nearly as popular as these 30 stocks and hedge funds that were betting on QGEN were disappointed as the stock returned -0.8% since the end of December (through 4/19) 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 many of these stocks already outperformed the market since 2019.

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