Amid The Perceived Gloom In The Hedge Fund Universe, This Hedge Fund’s Stock Picks Gained 38.8% in Q1

Loxo Oncology Inc (NASDAQ:LOXO)

Another major winner for Casdin Capital this year has been Loxo Oncology Inc (NASDAQ:LOXO), whose stock has appreciated by 38.7% year-to-date. It’s also the only company among the fund’s top-three stock picks in which it didn’t reduce its holding during the first-quarter, keeping it unchanged. Though the stock generated over $5 million in profit for the fund during the first-quarter, Casdin Capital actually had less exposure to it in its 13F portfolio by the end of the quarter (down to 8.94% from 9.55%) due to the relative outperformance of other stocks that the fund held.

At the beginning of the year, Loxo Oncology Inc (NASDAQ:LOXO) held a secondary public offering of 3.87 million units of its common stock at $31 each. The company disclosed that it would be using the net proceeds from the sale for R&D, to fund early commercialization activities for its lead product candidate larotrectinib (LOXO-101), and for general corporate purposes. In March, the company announced that it had signed a collaboration agreement with Ventana Medical Systems to develop and commercialize a pan-TRK immunohistochemistry (IHC) test as a companion diagnostic to identify suitable patients for treatment with larotrectinib. Earlier this month, Loxo Oncology Inc (NASDAQ:LOXO) enjoyed a major win when the FDA designated larotrectinib as an Orphan drug for the treatment of solid tumors with rare genetic abnormalities called NTRK-fusion proteins. Most analysts which cover Loxo are currently bullish on it, including Morgan Stanley analyst Mathew Harrison, who has an ‘Overweight’ rating and $59 price target on it, suggesting upside potential of 32.46%.

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