At Insider Monkey, we pore over the filings of nearly 873 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we’ve gathered as a result gives us access to a wealth of collective knowledge based on these firms’ portfolio holdings as of June 30th. In this article, we will use that wealth of knowledge to determine whether or not United Therapeutics Corporation (NASDAQ:UTHR) makes for a good investment right now.
United Therapeutics Corporation (NASDAQ:UTHR) investors should pay attention to an increase in hedge fund sentiment of late. United Therapeutics Corporation (NASDAQ:UTHR) was in 45 hedge funds’ portfolios at the end of June. The all time high for this statistic was previously 42. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 42 hedge funds in our database with UTHR holdings at the end of March. Our calculations also showed that UTHR isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
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Joseph Edelman of Perceptive Advisors
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Do Hedge Funds Think UTHR Is A Good Stock To Buy Now?
At second quarter’s end, a total of 45 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 7% from the first quarter of 2020. By comparison, 41 hedge funds held shares or bullish call options in UTHR a year ago. 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 United Therapeutics Corporation (NASDAQ:UTHR) was held by Renaissance Technologies, which reported holding $558 million worth of stock at the end of June. It was followed by Avoro Capital Advisors (venBio Select Advisor) with a $538.2 million position. Other investors bullish on the company included Palo Alto Investors, Perceptive Advisors, and Millennium Management. In terms of the portfolio weights assigned to each position Avoro Capital Advisors (venBio Select Advisor) allocated the biggest weight to United Therapeutics Corporation (NASDAQ:UTHR), around 9.36% of its 13F portfolio. Palo Alto Investors is also relatively very bullish on the stock, dishing out 6.79 percent of its 13F equity portfolio to UTHR.
With a general bullishness amongst the heavyweights, specific money managers have been driving this bullishness. Point72 Asset Management, managed by Steve Cohen, initiated the most outsized position in United Therapeutics Corporation (NASDAQ:UTHR). Point72 Asset Management had $99.1 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital also made a $21.5 million investment in the stock during the quarter. The other funds with new positions in the stock are Louis Bacon’s Moore Global Investments, Dan Kozlowski’s Plaisance Capital, and Greg Poole’s Echo Street Capital Management.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as United Therapeutics Corporation (NASDAQ:UTHR) but similarly valued. These stocks are YETI Holdings, Inc. (NYSE:YETI), Kinross Gold Corporation (NYSE:KGC), Mobile TeleSystems Public Joint Stock Company (NYSE:MBT), Autohome Inc (NYSE:ATHM), Gentex Corporation (NASDAQ:GNTX), Donaldson Company, Inc. (NYSE:DCI), and Amedisys Inc (NASDAQ:AMED). This group of stocks’ market caps match UTHR’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| YETI | 34 | 282409 | 4 |
| KGC | 28 | 360274 | 1 |
| MBT | 10 | 293155 | -1 |
| ATHM | 16 | 344855 | -2 |
| GNTX | 34 | 440659 | -1 |
| DCI | 21 | 258723 | -7 |
| AMED | 26 | 271283 | 0 |
| Average | 24.1 | 321623 | -0.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 24.1 hedge funds with bullish positions and the average amount invested in these stocks was $322 million. That figure was $2334 million in UTHR’s case. YETI Holdings, Inc. (NYSE:YETI) is the most popular stock in this table. On the other hand Mobile TeleSystems Public Joint Stock Company (NYSE:MBT) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks United Therapeutics Corporation (NASDAQ:UTHR) is more popular among hedge funds. Our overall hedge fund sentiment score for UTHR is 88. 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 returned 29.6% in 2021 through November 5th but still managed to beat the market by 3.1 percentage points. Hedge funds were also right about betting on UTHR as the stock returned 12.8% since the end of June (through 11/5) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
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Disclosure: None. This article was originally published at Insider Monkey.
