While the market driven by short-term sentiment influenced by the accommodative interest rate environment in the US, virus news and stimulus spending, many smart money investors are starting to get cautious towards the current bull run since March, 2020 and hedging or reducing many of their long positions. Some fund managers are betting on Dow hitting 40,000 to generate strong returns. However, as we know, big investors usually buy stocks with strong fundamentals that can deliver gains both in bull and bear markets, which is why we believe we can profit from imitating them. In this article, we are going to take a look at the smart money sentiment surrounding SomaLogic Inc. (NASDAQ:SLGC).
Is SomaLogic Inc. (NASDAQ:SLGC) a first-rate investment today? Prominent investors were taking a bullish view. The number of long hedge fund bets inched up by 37 lately. SomaLogic Inc. (NASDAQ:SLGC) was in 37 hedge funds’ portfolios at the end of the third quarter of 2021. Our calculations also showed that SLGC isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. With all of this in mind we’re going to take a look at the recent hedge fund action regarding SomaLogic Inc. (NASDAQ:SLGC).
Cathie Wood of ARK Investment Management
Do Hedge Funds Think SLGC Is A Good Stock To Buy Now?
At third quarter’s end, a total of 37 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 37 from the second quarter of 2021. Below, you can check out the change in hedge fund sentiment towards SLGC over the last 25 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in SomaLogic Inc. (NASDAQ:SLGC) was held by Casdin Capital, which reported holding $153.5 million worth of stock at the end of September. It was followed by ARK Investment Management with a $78.5 million position. Other investors bullish on the company included Farallon Capital, Redmile Group, and Corvex Capital. In terms of the portfolio weights assigned to each position Casdin Capital allocated the biggest weight to SomaLogic Inc. (NASDAQ:SLGC) , around 3.82% of its 13F portfolio. SB Management is also relatively very bullish on the stock, setting aside 2.79 percent of its 13F equity portfolio to SLGC.
Now, key money managers were leading the bulls’ herd. Casdin Capital, managed by Eli Casdin, established the largest position in SomaLogic Inc. (NASDAQ:SLGC) . Casdin Capital had $153.5 million invested in the company at the end of the quarter. Catherine D. Wood’s ARK Investment Management also made a $78.5 million investment in the stock during the quarter. The other funds with brand new SLGC positions are Farallon Capital, Jeremy Green’s Redmile Group, and Keith Meister’s Corvex Capital.
Let’s also examine hedge fund activity in other stocks similar to SomaLogic Inc. (NASDAQ:SLGC) . We will take a look at O-I Glass, Inc. (NYSE:OI), Glaukos Corporation (NYSE:GKOS), First Financial Bancorp (NASDAQ:FFBC), Hillman Solutions Corp. (NASDAQ:HLMN), Telephone & Data Systems, Inc. (NYSE:TDS), Astra Space Inc. (NASDAQ:ASTR), and D-MARKET Elektronik Hizmetler ve Ticaret Anonim Sirketi (NASDAQ:HEPS). This group of stocks’ market values are closest to SLGC’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| OI | 32 | 258993 | 8 |
| GKOS | 23 | 176344 | 4 |
| FFBC | 7 | 10840 | 0 |
| HLMN | 25 | 481224 | 25 |
| TDS | 19 | 120636 | 1 |
| ASTR | 13 | 85412 | 1 |
| HEPS | 7 | 14494 | 7 |
| Average | 18 | 163992 | 6.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 18 hedge funds with bullish positions and the average amount invested in these stocks was $164 million. That figure was $648 million in SLGC’s case. O-I Glass, Inc. (NYSE:OI) is the most popular stock in this table. On the other hand First Financial Bancorp (NASDAQ:FFBC) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks SomaLogic Inc. (NASDAQ:SLGC) is more popular among hedge funds. Our overall hedge fund sentiment score for SLGC 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 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 28.6% in 2021 through November 30th and still beat the market by 5.6 percentage points. Unfortunately SLGC wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on SLGC were disappointed as the stock returned -6.6% since the end of the third quarter (through 11/30) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.
