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Do Hedge Funds Still Like Oxford Immunotec Global PLC (OXFD)?

How do you pick the next stock to invest in? One way would be to spend days of research browsing through thousands of publicly traded companies. However, an easier way is to look at the stocks that smart money investors are collectively bullish on. Hedge funds and other institutional investors usually invest large amounts of capital and have to conduct due diligence while choosing their next pick. They don’t always get it right, but, on average, their stock picks historically generated strong returns after adjusting for known risk factors. With this in mind, let’s take a look at the recent hedge fund activity surrounding Oxford Immunotec Global PLC (NASDAQ:OXFD) and determine whether hedge funds had an edge regarding this stock.

Oxford Immunotec Global PLC (NASDAQ:OXFD) was in 18 hedge funds’ portfolios at the end of June. The all time high for this statistics is 20. OXFD investors should be aware of a decrease in enthusiasm from smart money in recent months. There were 20 hedge funds in our database with OXFD holdings at the end of March. Our calculations also showed that OXFD isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings and see the video for a quick look at the top 5 stocks).

Video: Watch our video about the top 5 most popular hedge fund stocks.

In today’s marketplace there are dozens of indicators shareholders use to size up stocks. A pair of the less known indicators are hedge fund and insider trading interest. We have shown that, historically, those who follow the best picks of the best hedge fund managers can outpace the S&P 500 by a very impressive amount (see the details here).

Paul Marshall Marshall Wace

Paul Marshall of Marshall Wace

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we are checking out this junior gold mining stock and we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. 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 website to get excerpts of these letters in your inbox. Keeping this in mind let’s take a glance at the key hedge fund action regarding Oxford Immunotec Global PLC (NASDAQ:OXFD).

Hedge fund activity in Oxford Immunotec Global PLC (NASDAQ:OXFD)

Heading into the third quarter of 2020, a total of 18 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -10% from the first quarter of 2020. By comparison, 16 hedge funds held shares or bullish call options in OXFD a year ago. With the smart money’s sentiment swirling, there exists a select group of key hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).

Is OXFD A Good Stock To Buy?

Of the funds tracked by Insider Monkey, Polar Capital, managed by Brian Ashford-Russell and Tim Woolley, holds the biggest position in Oxford Immunotec Global PLC (NASDAQ:OXFD). Polar Capital has a $33.4 million position in the stock, comprising 0.3% of its 13F portfolio. The second most bullish fund manager is Alyeska Investment Group, managed by Anand Parekh, which holds a $24.5 million position; 0.4% of its 13F portfolio is allocated to the company. Other professional money managers that hold long positions comprise Richard Mashaal’s Rima Senvest Management, Vishal Saluja and Pham Quang’s Endurant Capital Management and Israel Englander’s Millennium Management. In terms of the portfolio weights assigned to each position Birchview Capital allocated the biggest weight to Oxford Immunotec Global PLC (NASDAQ:OXFD), around 1.34% of its 13F portfolio. Rima Senvest Management is also relatively very bullish on the stock, setting aside 1.18 percent of its 13F equity portfolio to OXFD.

Since Oxford Immunotec Global PLC (NASDAQ:OXFD) has faced bearish sentiment from hedge fund managers, logic holds that there lies a certain “tier” of hedgies who were dropping their entire stakes by the end of the second quarter. At the top of the heap, Mitchell Blutt’s Consonance Capital Management dumped the biggest investment of the 750 funds tracked by Insider Monkey, comprising close to $11.5 million in stock, and Timothy P. Lynch’s Stonepine Capital was right behind this move, as the fund cut about $3.5 million worth. These bearish behaviors are important to note, as total hedge fund interest fell by 2 funds by the end of the second quarter.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Oxford Immunotec Global PLC (NASDAQ:OXFD) but similarly valued. These stocks are United Insurance Holdings Corp. (NASDAQ:UIHC), Solaris Oilfield Infrastructure, Inc. (NYSE:SOI), Motorcar Parts of America, Inc. (NASDAQ:MPAA), Natural Grocers by Vitamin Cottage Inc (NYSE:NGVC), International General Insurance Holdings Ltd. (NASDAQ:IGIC), Farmers National Banc Corp (NASDAQ:FMNB), and International Tower Hill Mines Ltd (NYSE:THM). All of these stocks’ market caps are closest to OXFD’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
UIHC 9 6144 0
SOI 17 30849 6
MPAA 8 65552 2
NGVC 12 29127 3
IGIC 9 10808 -1
FMNB 8 11104 -1
THM 4 169801 0
Average 9.6 46198 1.3

View table here if you experience formatting issues.

As you can see these stocks had an average of 9.6 hedge funds with bullish positions and the average amount invested in these stocks was $46 million. That figure was $144 million in OXFD’s case. Solaris Oilfield Infrastructure, Inc. (NYSE:SOI) is the most popular stock in this table. On the other hand International Tower Hill Mines Ltd (NYSE:THM) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks Oxford Immunotec Global PLC (NASDAQ:OXFD) is more popular among hedge funds. Our overall hedge fund sentiment score for OXFD is 80. 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 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 24.8% in 2020 through the end of September and still beat the market by 19.3 percentage points. Unfortunately OXFD wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on OXFD were disappointed as the stock returned -10% during the third quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.

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Disclosure: None. This article was originally published at Insider Monkey.