Were Hedge Funds Right About Piling Into Uniqure NV (QURE)?

While the market driven by short-term sentiment influenced by the accomodative interest rate environment in the US, virus news and stimulus talks, many smart money investors are starting to get cautious towards the current bull run since March and hedging or reducing many of their long positions. Some fund managers are betting on Dow hitting 30,000 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 Uniqure NV (NASDAQ:QURE).

Uniqure NV (NASDAQ:QURE) investors should pay attention to an increase in enthusiasm from smart money in recent months. Uniqure NV (NASDAQ:QURE) was in 49 hedge funds’ portfolios at the end of the second quarter of 2020. The all time high for this statistics is 44. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 44 hedge funds in our database with QURE positions at the end of the first quarter. Our calculations also showed that QURE isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings and see the video for a quick look at the top 5 stocks).

Video: Watch our video about the top 5 most popular hedge fund stocks.

To the average investor there are many tools shareholders employ to analyze stocks. A duo of the most useful tools are hedge fund and insider trading activity. Our experts have shown that, historically, those who follow the top picks of the best hedge fund managers can beat the market by a very impressive amount (see the details here).

Michael Gelband of ExodusPoint Capital

At Insider Monkey we scour multiple sources to uncover the next great investment idea. Hedge fund sentiment towards Tesla reached its all time high at the end of 2019 and Tesla shares more than quadrupled this year. We are trying to identify other EV revolution winners, so we are checking out this under-the-radar lithium stock. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. 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 to get excerpts of these letters in your inbox. With all of this in mind we’re going to take a gander at the latest hedge fund action encompassing Uniqure NV (NASDAQ:QURE).

What have hedge funds been doing with Uniqure NV (NASDAQ:QURE)?

At the end of June, a total of 49 of the hedge funds tracked by Insider Monkey were long this stock, a change of 11% from the previous quarter. The graph below displays the number of hedge funds with bullish position in QURE over the last 20 quarters. So, let’s examine 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, Nantahala Capital Management, managed by Wilmot B. Harkey and Daniel Mack, holds the number one position in Uniqure NV (NASDAQ:QURE). Nantahala Capital Management has a $70.7 million position in the stock, comprising 2.1% of its 13F portfolio. The second largest stake is held by Avoro Capital Advisors (venBio Select Advisor), led by Behzad Aghazadeh, holding a $67.6 million position; the fund has 1.3% of its 13F portfolio invested in the stock. Other members of the smart money that are bullish comprise Jeremy Green’s Redmile Group, Steve Cohen’s Point72 Asset Management and Wilmot B. Harkey and Daniel Mack’s Nantahala Capital Management. In terms of the portfolio weights assigned to each position Aquilo Capital Management allocated the biggest weight to Uniqure NV (NASDAQ:QURE), around 6.18% of its 13F portfolio. Corriente Advisors is also relatively very bullish on the stock, setting aside 5.26 percent of its 13F equity portfolio to QURE.

Consequently, some big names were leading the bulls’ herd. Point72 Asset Management, managed by Steve Cohen, initiated the most outsized position in Uniqure NV (NASDAQ:QURE). Point72 Asset Management had $49.3 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made a $12.2 million investment in the stock during the quarter. The other funds with new positions in the stock are Mark Hart III’s Corriente Advisors, Richard Mashaal’s Rima Senvest Management, and Michael Gelband’s ExodusPoint Capital.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Uniqure NV (NASDAQ:QURE) but similarly valued. We will take a look at Barnes Group Inc. (NYSE:B), Extended Stay America Inc (NASDAQ:STAY), Nu Skin Enterprises, Inc. (NYSE:NUS), PJT Partners Inc (NYSE:PJT), Spectrum Brands Holdings, Inc. (NYSE:SPB), Principia Biopharma Inc. (NASDAQ:PRNB), and AssetMark Financial Holdings, Inc. (NYSE:AMK). This group of stocks’ market valuations resemble QURE’s market valuation.

View table here if you experience formatting issues.

As you can see these stocks had an average of 21.9 hedge funds with bullish positions and the average amount invested in these stocks was $239 million. That figure was $595 million in QURE’s case. Extended Stay America Inc (NASDAQ:STAY) is the most popular stock in this table. On the other hand AssetMark Financial Holdings, Inc. (NYSE:AMK) is the least popular one with only 6 bullish hedge fund positions. Compared to these stocks Uniqure NV (NASDAQ:QURE) is more popular among hedge funds. Our overall hedge fund sentiment score for QURE 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 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 30% in 2020 through October 23rd and still beat the market by 21 percentage points. Unfortunately QURE wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on QURE were disappointed as the stock returned -5.4% since the end of the second quarter (through 10/23) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.

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