More and More Hedge Funds Are Selling Quest Diagnostics Inc (DGX)

Hedge funds and other investment firms run by legendary investors like Israel Englander and Ray Dalio are entrusted to manage billions of dollars of accredited investors’ money because they are without peer in the resources they use to identify the best investments for their chosen investment horizon. Moreover, they are more willing to invest a greater amount of their resources in small-cap stocks than big brokerage houses, and this is often where they generate their outperformance, which is why we pay particular attention to their best ideas in this space.

Is Quest Diagnostics Inc (NYSE:DGX) ready to rally soon? Hedge funds are in a bearish mood. The number of long hedge fund bets went down by 1 lately. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Cenovus Energy Inc (USA) (NYSE:CVE), Oneok Partners LP (NYSE:OKS), and ArcelorMittal (ADR) (NYSE:MT) to gather more data points.

At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.

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Hedge fund activity in Quest Diagnostics Inc (NYSE:DGX)

At the end of the third quarter, a total of 24 of the hedge funds tracked by Insider Monkey held long positions in this stock, a decline of 4% from the second quarter of 2016 and the second quarterly drop in hedge fund ownership in a row. With hedge funds’ sentiment swirling, there exists a few notable hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Cliff Asness’ AQR Capital Management has the biggest position in Quest Diagnostics Inc (NYSE:DGX), worth close to $107.9 million. The second most bullish fund manager is Marshall Wace LLP, managed by Paul Marshall and Ian Wace, which holds a $78.1 million position. Remaining peers with similar optimism include John W. Rogers’ Ariel Investments, Joel Greenblatt’s Gotham Asset Management and Bernard Horn’s Polaris Capital Management.