The elite funds run by legendary investors such as Dan Loeb and David Tepper make hundreds of millions of dollars for themselves and their investors by spending enormous resources doing research on small cap stocks that big investment banks don’t follow. Because of their pay structures, they have strong incentive to do the research necessary to beat the market. That’s why we pay close attention to what they think in small cap stocks. In this article, we take a closer look at Bio-Rad Laboratories, Inc. (NYSE:BIO) from the perspective of those elite funds.
Bio-Rad Laboratories, Inc. (NYSE:BIO) was in 29 hedge funds’ portfolios at the end of September. Bio-Rad Laboratories, Inc. (NYSE:BIO) investors should pay attention to an increase in hedge fund sentiment recently. There were 25 hedge funds in our database with Bio-Rad Laboratories, Inc. (NYSE:BIO) positions at the end of the previous quarter. At the end of this article, we will also compare Bio-Rad Laboratories, Inc. (NYSE:BIO) to other stocks including Lincoln Electric Holdings, Inc. (NASDAQ:LECO), Godaddy Inc (NYSE:GDDY), and Siliconware Precision Industries (ADR) (NASDAQ:SPIL) to get a better sense of its popularity.
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To most market participants, hedge funds are viewed as worthless, outdated financial tools of the past. While there are more than 8000 funds in operation at the moment, we hone in on the upper echelon of this club, around 700 funds. It is estimated that this group of investors controls the bulk of the smart money’s total capital, and by keeping an eye on their first-class equity investments, Insider Monkey has formulated several investment strategies that have historically surpassed the market. Insider Monkey’s small-cap hedge fund strategy exceeded the S&P 500 index by 12 percentage points a year for a decade in their back tests.
Now, we’re going to view the latest action surrounding Bio-Rad Laboratories, Inc. (NYSE:BIO).
How have hedgies been trading Bio-Rad Laboratories, Inc. (NYSE:BIO)?
Heading into Q4, a total of 29 of the hedge funds tracked by Insider Monkey were bullish on this stock, an increase of 16% from one quarter earlier. With the smart money’s sentiment swirling, there exists a select group of notable hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
Of the funds tracked by Insider Monkey, John A. Levin’s Levin Capital Strategies has the number one position in Bio-Rad Laboratories, Inc. (NYSE:BIO), worth close to $84.5 million, comprising 1.4% of its total 13F portfolio. The second largest stake is held by Millennium Management, managed by Israel Englander, which holds a $60 million position; 0.1% of its 13F portfolio is allocated to the company. Hedge funds and other institutional investors with similar optimism comprise Chuck Royce’s Royce & Associates, Ken Fisher’s Fisher Asset Management and Joel Greenblatt’s Gotham Asset Management.
As aggregate interest increased, key money managers were breaking ground themselves. Point72 Asset Management, managed by Steve Cohen, created the largest position in Bio-Rad Laboratories, Inc. (NYSE:BIO). Point72 Asset Management had $9.9 million invested in the company at the end of the quarter. George Hall’s Clinton Group also made an $0.6 million investment in the stock during the quarter. The other funds with new positions in the stock are Ray Dalio’s Bridgewater Associates, Peter Algert and Kevin Coldiron’s Algert Coldiron Investors, and Soros Fund Management.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Bio-Rad Laboratories, Inc. (NYSE:BIO) but similarly valued. These stocks are Lincoln Electric Holdings, Inc. (NASDAQ:LECO), Godaddy Inc (NYSE:GDDY), Siliconware Precision Industries (ADR) (NASDAQ:SPIL), and Team Health Holdings LLC (NYSE:TMH). All of these stocks’ market caps are similar to Bio-Rad Laboratories, Inc. (NYSE:BIO)’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| LECO | 22 | 276662 | -1 |
| GDDY | 21 | 130451 | 2 |
| SPIL | 10 | 14103 | 0 |
| TMH | 25 | 524520 | 3 |
As you can see, these stocks had an average of 20 hedge funds with bullish positions and the average amount invested in these stocks was $236 million, compared to $477 million in Bio-Rad Laboratories, Inc. (NYSE:BIO)’s case. Team Health Holdings LLC (NYSE:TMH) is the most popular stock in this table with 25 long positions. On the other hand, Siliconware Precision Industries (ADR) (NASDAQ:SPIL) is the least popular one. Compared to these stocks Bio-Rad Laboratories, Inc. (NYSE:BIO) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially acquire a long stake.
