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 Brainstorm Cell Therapeutics Inc. (NASDAQ:BCLI).
Brainstorm Cell Therapeutics Inc. (NASDAQ:BCLI) has experienced a decrease in enthusiasm from smart money recently. Brainstorm Cell Therapeutics Inc. (NASDAQ:BCLI) was in 3 hedge funds’ portfolios at the end of September. The all time high for this statistics is 6. There were 6 hedge funds in our database with BCLI positions at the end of the second quarter. Our calculations also showed that BCLI isn’t among the 30 most popular stocks among hedge funds (click for Q3 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.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 66 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 17th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
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 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. With all of this in mind let’s take a glance at the new hedge fund action encompassing Brainstorm Cell Therapeutics Inc. (NASDAQ:BCLI).
Hedge fund activity in Brainstorm Cell Therapeutics Inc. (NASDAQ:BCLI)
Heading into the fourth quarter of 2020, a total of 3 of the hedge funds tracked by Insider Monkey were long this stock, a change of -50% from the second quarter of 2020. By comparison, 2 hedge funds held shares or bullish call options in BCLI a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).
More specifically, Citadel Investment Group was the largest shareholder of Brainstorm Cell Therapeutics Inc. (NASDAQ:BCLI), with a stake worth $4.1 million reported as of the end of September. Trailing Citadel Investment Group was Winton Capital Management, which amassed a stake valued at $1.6 million. AQR Capital Management was 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 Winton Capital Management allocated the biggest weight to Brainstorm Cell Therapeutics Inc. (NASDAQ:BCLI), around 0.05% of its 13F portfolio. OZ Management is also relatively very bullish on the stock, earmarking 0.0014 percent of its 13F equity portfolio to BCLI.
Because Brainstorm Cell Therapeutics Inc. (NASDAQ:BCLI) has faced falling interest from the aggregate hedge fund industry, it’s safe to say that there lies a certain “tier” of fund managers who were dropping their full holdings last quarter. It’s worth mentioning that Renaissance Technologies sold off the largest stake of all the hedgies monitored by Insider Monkey, valued at close to $1.6 million in stock, and D. E. Shaw’s D E Shaw was right behind this move, as the fund said goodbye to about $0.4 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest dropped by 3 funds last quarter.
Let’s now take a look at hedge fund activity in other stocks similar to Brainstorm Cell Therapeutics Inc. (NASDAQ:BCLI). We will take a look at Intersect ENT Inc (NASDAQ:XENT), Marine Products Corp. (NYSE:MPX), SurModics, Inc. (NASDAQ:SRDX), Washington Trust Bancorp (NASDAQ:WASH), Scholar Rock Holding Corporation (NASDAQ:SRRK), Vanda Pharmaceuticals Inc. (NASDAQ:VNDA), and Hycroft Mining Holding Corporation (NASDAQ:HYMC). This group of stocks’ market values are closest to BCLI’s market value.
|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 12.7 hedge funds with bullish positions and the average amount invested in these stocks was $123 million. That figure was $2 million in BCLI’s case. Vanda Pharmaceuticals Inc. (NASDAQ:VNDA) is the most popular stock in this table. On the other hand Scholar Rock Holding Corporation (NASDAQ:SRRK) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks Brainstorm Cell Therapeutics Inc. (NASDAQ:BCLI) is even less popular than SRRK. Our overall hedge fund sentiment score for BCLI is 17. 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. Hedge funds dodged a bullet by taking a bearish stance towards BCLI. Our calculations showed that the top 20 most popular hedge fund stocks returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 28.1% in 2020 through November 23rd but managed to beat the market again by 15.4 percentage points. Unfortunately BCLI wasn’t nearly as popular as these 20 stocks (hedge fund sentiment was very bearish); BCLI investors were disappointed as the stock returned -71.6% since the end of the third quarter (through 11/23) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as most of these stocks already outperformed the market so far in 2020.
Disclosure: None. This article was originally published at Insider Monkey.