Aetna Inc. (AET): Hedge Fund Bullishness Hits 3-Year High
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Hedge funds and other investment firms that we track manage billions of dollars of their wealthy clients' money, and needless to say, they are painstakingly thorough when analyzing where to invest this money, as their own wealth depends on it. Regardless of the various methods used by elite investors like David Tepper and Dan Loeb, the resources they expend are second-to-none. This is especially valuable when it comes to small-cap stocks, which is where they generate their strongest outperformance, as their resources give them a huge edge when it comes to studying these stocks compared to the average investor, which is why we intently follow their activity in the small-cap space. However, in this article we'll look at their feelings towards large-cap healthcare giant Aetna Inc. (NYSE:AET).
Hedge funds continue to grow more bullish on Aetna Inc. (NYSE:AET), as there was a 14% jump during Q3 in the number of funds that own shares of the company. With 79 funds now long the stock (as of September 30), Aetna ranked 21st on our countdown of the 30 Most Popular Stocks Among Hedge Funds, being owned by prominent healthcare investors like Larry Robbins' Glenview Capital and Matthew Halbower's Pentwater Capital. Aetna also topped our list of the 5 Best Dental Insurance Stocks To Buy Heading Into 2019.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey's flagship best performing hedge funds strategy returned 17.4% year to date and outperformed the market by more than 14 percentage points this year. This strategy also outperformed the market by 3 percentage points in the fourth quarter despite the market volatility (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
What have hedge funds been doing with Aetna Inc. (NYSE:AET)?
At Q3's end, a total of 79 of the hedge funds tracked by Insider Monkey were bullish on this stock, a 14% jump from one quarter earlier. The graph below displays the number of hedge funds with bullish positions in AET over the last 13 quarters. With hedgies' positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were adding to their stakes significantly (or already accumulated large positions).