5 Biotech Penny Stocks Smart Money Is Piling On

#3 Peregrine Pharmaceuticals (NASDAQ:PPHM)

– Hedge Funds With Long Positions (as of June 30): 10

– Value of Hedge Funds’ Holdings (as of June 30): $1.53 Million

Peregrine Pharmaceuticals (NASDAQ:PPHM) is another stock which took a huge beating in February, and as a result, is trading down by more than 69% year-to-date. The slump in the stock came in late-February after the company revealed that its lead product candidate, Bavituximab, failed a Phase 3 clinical trial in patients suffering from non-squamous non-small cell lung cancer. Nevertheless, the popularity of Peregrine Pharmaceuticals (NASDAQ:PPHM) among the hedge funds in our database saw a notable increase during the second quarter, as ownership of the stock doubled and the aggregate value of their holdings in it jumped by 119.3%. On September 9, the company reported its fiscal year 2017 first quarter results, declaring a loss of $0.04 per share on revenue of $5.61 million, compared to a loss of $0.09 per share on revenue of $9.52 million for the same quarter of last year.

#2 XOMA Corp (NASDAQ:XOMA)

– Hedge Funds With Long Positions (as of June 30): 10

– Value of Hedge Funds’ Holdings (as of June 30): $3.22 Million

Moving on, the number of hedge funds that we track that were long XOMA Corp (NASDAQ:XOMA) increased by four during the second quarter, though the aggregate value of their holdings in it fell by 34.5% during that time. Hedge funds that initiated a stake in the company during the second quarter included billionaire Jim Simons‘ Renaissance Technologies and Gavin Saitowitz and Cisco J. Del Valle’s Springbok Capital. XOMA Corp (NASDAQ:XOMA)’s stock has lost a significant amount of its value in 2016, being down by almost 80%, though its status as a penny stock changed a few days ago when the company executed a 1-for-20 reverse stock split to lift its stock back above the $1.00 mark to comply with Nasdaq’s listing standards. For its second quarter, the California-based development-stage biotechnology company reported a loss of $0.13 per share on revenue of $0.44 million, missing analysts’ expectations of an EPS loss of $0.12 on revenue of $0.90 million.

#1 AVEO Pharmaceuticals, Inc. (NASDAQ:AVEO)

– Hedge Funds With Long Positions (as of June 30): 10

– Value of Hedge Funds’ Holdings (as of June 30): $9.12 Million

AVEO Pharmaceuticals, Inc. (NASDAQ:AVEO) was the most popular biotech penny stock at the end of the first-half of 2016 among the hedge funds that we track, with more money invested in it than the other two stocks with the same number of hedge fund shareholders. The number of funds long the stock increased by four during the second quarter, with the aggregate value of their holdings in it increasing by 38%. AVEO Pharmaceuticals, Inc. (NASDAQ:AVEO)’s stock is down by 41.27% year-to-date, and by almost 96% over the last five years. In May, the company revealed that it has raised $17 million through a private placement of 17.64 million units at $0.95 per unit. Each unit consisted of one share of common stock along with a five-year warrant to purchase one share of common stock at $1.00. The company intends to use the proceeds from the private placement to fund the U.S. Phase 3 study of its lead product candidate, tivozanib, and for general corporate purposes. On September 9, analysts at FBR & Co reiterated their ‘Buy’ rating on the stock.

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