Before we spend countless hours researching a company, we like to analyze what insiders, hedge funds and billionaire investors think of the stock first. This is a necessary first step in our investment process because our research has shown that the elite investors’ consensus returns have been exceptional. In the following paragraphs, we find out what the billionaire investors and hedge funds think of CryoPort, Inc. (NASDAQ:CYRX).
Is CryoPort, Inc. (NASDAQ:CYRX) a splendid investment today? Hedge funds were in a bearish mood. The number of long hedge fund positions retreated by 1 recently. CryoPort, Inc. (NASDAQ:CYRX) was in 20 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 21. Our calculations also showed that CYRX isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).
So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 115 percentage points since March 2017 (see the details here). We have been able to outperform the passive index funds by tracking the moves of corporate insiders and hedge funds, and we believe small investors can benefit a lot from reading hedge fund investor letters and 13F filings.
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, pet market is growing at a 7% annual rate and is expected to reach $110 billion in 2021. So, we are checking out the 5 best stocks for animal lovers. We go through lists like the 15 best Jim Cramer stocks to identify the next Tesla that will deliver outsized returns. 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 homepage. Keeping this in mind we’re going to view the recent hedge fund action regarding CryoPort, Inc. (NASDAQ:CYRX).
Do Hedge Funds Think CYRX Is A Good Stock To Buy Now?
At Q1’s end, a total of 20 of the hedge funds tracked by Insider Monkey were long this stock, a change of -5% from one quarter earlier. By comparison, 9 hedge funds held shares or bullish call options in CYRX a year ago. With hedgies’ sentiment swirling, there exists a few noteworthy hedge fund managers who were adding to their stakes considerably (or already accumulated large positions).
The largest stake in CryoPort, Inc. (NASDAQ:CYRX) was held by Impax Asset Management, which reported holding $31.7 million worth of stock at the end of December. It was followed by Driehaus Capital with a $25.1 million position. Other investors bullish on the company included Alyeska Investment Group, Millennium Management, and Citadel Investment Group. In terms of the portfolio weights assigned to each position Roubaix Capital allocated the biggest weight to CryoPort, Inc. (NASDAQ:CYRX), around 1.73% of its 13F portfolio. Precept Capital Management is also relatively very bullish on the stock, earmarking 1.42 percent of its 13F equity portfolio to CYRX.
Due to the fact that CryoPort, Inc. (NASDAQ:CYRX) has witnessed a decline in interest from hedge fund managers, logic holds that there were a few money managers that elected to cut their entire stakes last quarter. It’s worth mentioning that Robert Joseph Caruso’s Select Equity Group said goodbye to the biggest position of the 750 funds watched by Insider Monkey, comprising about $18.9 million in stock, and Paul Marshall and Ian Wace’s Marshall Wace LLP was right behind this move, as the fund cut about $5.1 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest dropped by 1 funds last quarter.
Let’s go over hedge fund activity in other stocks similar to CryoPort, Inc. (NASDAQ:CYRX). These stocks are Cubic Corporation (NYSE:CUB), WSFS Financial Corporation (NASDAQ:WSFS), Mueller Industries, Inc. (NYSE:MLI), Ultra Clean Holdings Inc (NASDAQ:UCTT), Boise Cascade Co (NYSE:BCC), Avaya Holdings Corp. (NYSE:AVYA), and Himax Technologies, Inc. (NASDAQ:HIMX). All of these stocks’ market caps are closest to CYRX’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 21.3 hedge funds with bullish positions and the average amount invested in these stocks was $242 million. That figure was $129 million in CYRX’s case. Avaya Holdings Corp. (NYSE:AVYA) is the most popular stock in this table. On the other hand WSFS Financial Corporation (NASDAQ:WSFS) is the least popular one with only 10 bullish hedge fund positions. CryoPort, Inc. (NASDAQ:CYRX) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for CYRX is 51.1. 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. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. 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 gained 23.8% in 2021 through July 16th and surpassed the market again by 7.7 percentage points. Unfortunately CYRX wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); CYRX investors were disappointed as the stock returned 5.4% since the end of March (through 7/16) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2021.
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Disclosure: None. This article was originally published at Insider Monkey.