Hedge Funds Are Cashing Out Of Intellia Therapeutics, Inc. (NTLA)

The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 867 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their September 30th holdings, data that is available nowhere else. Should you consider Intellia Therapeutics, Inc. (NASDAQ:NTLA) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.

Is Intellia Therapeutics, Inc. (NASDAQ:NTLA) worth your attention right now? Investors who are in the know were getting less bullish. The number of bullish hedge fund bets shrunk by 4 in recent months. Intellia Therapeutics, Inc. (NASDAQ:NTLA) was in 37 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 41. Our calculations also showed that NTLA isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings). There were 41 hedge funds in our database with NTLA positions at the end of the second quarter.

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. Keeping this in mind we’re going to analyze the key hedge fund action regarding Intellia Therapeutics, Inc. (NASDAQ:NTLA).

Do Hedge Funds Think NTLA Is A Good Stock To Buy Now?

At third quarter’s end, a total of 37 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -10% from the second quarter of 2021. On the other hand, there were a total of 15 hedge funds with a bullish position in NTLA a year ago. With the smart money’s capital changing hands, there exists a few key hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).

Among these funds, ARK Investment Management held the most valuable stake in Intellia Therapeutics, Inc. (NASDAQ:NTLA), which was worth $904.6 million at the end of the third quarter. On the second spot was Viking Global which amassed $171.6 million worth of shares. Darwin Global Management, Adage Capital Management, and Driehaus Capital were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Darwin Global Management allocated the biggest weight to Intellia Therapeutics, Inc. (NASDAQ:NTLA), around 18.57% of its 13F portfolio. Himension Capital is also relatively very bullish on the stock, dishing out 4.4 percent of its 13F equity portfolio to NTLA.

Seeing as Intellia Therapeutics, Inc. (NASDAQ:NTLA) has faced a decline in interest from the aggregate hedge fund industry, we can see that there were a few money managers that slashed their entire stakes last quarter. It’s worth mentioning that Neil Shahrestani’s Ikarian Capital said goodbye to the largest stake of all the hedgies followed by Insider Monkey, totaling close to $47.7 million in call options, and Jeffrey Jay and David Kroin’s Great Point Partners was right behind this move, as the fund dumped about $16.2 million worth. These transactions are interesting, as total hedge fund interest was cut by 4 funds last quarter.

Let’s check out hedge fund activity in other stocks similar to Intellia Therapeutics, Inc. (NASDAQ:NTLA). We will take a look at Levi Strauss & Co. (NYSE:LEVI), Chegg Inc (NYSE:CHGG), Hubbell Incorporated (NYSE:HUBB), Wynn Resorts, Limited (NASDAQ:WYNN), CubeSmart (NYSE:CUBE), Penumbra Inc (NYSE:PEN), and A. O. Smith Corporation (NYSE:AOS). This group of stocks’ market values are closest to NTLA’s market value.

View table here if you experience formatting issues.

As you can see these stocks had an average of 28.4 hedge funds with bullish positions and the average amount invested in these stocks was $420 million. That figure was $1620 million in NTLA’s case. Chegg Inc (NYSE:CHGG) is the most popular stock in this table. On the other hand Hubbell Incorporated (NYSE:HUBB) is the least popular one with only 18 bullish hedge fund positions. Intellia Therapeutics, Inc. (NASDAQ:NTLA) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for NTLA is 73.3. 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 positive signal but 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 28.6% in 2021 through November 30th and beat the market again by 5.6 percentage points. Unfortunately NTLA wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on NTLA were disappointed as the stock returned -14.3% since the end of September (through 11/30) 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 many of these stocks already outperformed the market since 2019.

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