The financial regulations require hedge funds and wealthy investors that exceeded the $100 million equity holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on March 31st, about a week after the S&P 500 Index bottomed. We at Insider Monkey have made an extensive database of more than 821 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) based on those filings.
Is Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) a buy here? The smart money is buying. The number of bullish hedge fund positions improved by 7 in recent months. Our calculations also showed that IOVA isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks). IOVA was in 39 hedge funds’ portfolios at the end of the first quarter of 2020. There were 32 hedge funds in our database with IOVA holdings at the end of the previous quarter.
Video: Watch our video about the top 5 most popular hedge fund stocks.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s monthly stock picks returned 87% since March 2017 and outperformed the S&P 500 ETFs by more than 51 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, we believe electric vehicles and energy storage are set to become giant markets, and we want to take advantage of the declining lithium prices amid the COVID-19 pandemic. So we are checking out investment opportunities like this one. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now we’re going to take a look at the recent hedge fund action encompassing Iovance Biotherapeutics, Inc. (NASDAQ:IOVA).
How have hedgies been trading Iovance Biotherapeutics, Inc. (NASDAQ:IOVA)?
At Q1’s end, a total of 39 of the hedge funds tracked by Insider Monkey were long this stock, a change of 22% from one quarter earlier. On the other hand, there were a total of 25 hedge funds with a bullish position in IOVA a year ago. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were adding to their stakes significantly (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Perceptive Advisors, managed by Joseph Edelman, holds the largest position in Iovance Biotherapeutics, Inc. (NASDAQ:IOVA). Perceptive Advisors has a $349.3 million position in the stock, comprising 9.1% of its 13F portfolio. The second largest stake is held by Behzad Aghazadeh of Avoro Capital Advisors (venBio Select Advisor), with a $269.7 million position; 9.1% of its 13F portfolio is allocated to the stock. Remaining peers that are bullish comprise Farallon Capital, Samuel Isaly’s OrbiMed Advisors and Steve Cohen’s Point72 Asset Management. In terms of the portfolio weights assigned to each position Avoro Capital Advisors (venBio Select Advisor) allocated the biggest weight to Iovance Biotherapeutics, Inc. (NASDAQ:IOVA), around 9.1% of its 13F portfolio. Perceptive Advisors is also relatively very bullish on the stock, earmarking 9.1 percent of its 13F equity portfolio to IOVA.
As aggregate interest increased, some big names have jumped into Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) headfirst. Acuta Capital Partners, managed by Manfred Yu, assembled the largest position in Iovance Biotherapeutics, Inc. (NASDAQ:IOVA). Acuta Capital Partners had $12 million invested in the company at the end of the quarter. Henrik Rhenman’s Rhenman & Partners Asset Management also initiated a $10.9 million position during the quarter. The other funds with new positions in the stock are Dmitry Balyasny’s Balyasny Asset Management, Carl Tiedemann and Michael Tiedemann’s TIG Advisors, and Israel Englander’s Millennium Management.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) but similarly valued. We will take a look at Integra Lifesciences Holdings Corp (NASDAQ:IART), Healthcare Realty Trust Inc (NYSE:HR), East West Bancorp, Inc. (NASDAQ:EWBC), and Silicon Laboratories Inc. (NASDAQ:SLAB). This group of stocks’ market valuations are closest to IOVA’s market valuation.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
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As you can see these stocks had an average of 19.5 hedge funds with bullish positions and the average amount invested in these stocks was $96 million. That figure was $1345 million in IOVA’s case. East West Bancorp, Inc. (NASDAQ:EWBC) is the most popular stock in this table. On the other hand Healthcare Realty Trust Inc (NYSE:HR) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) is more popular among hedge funds. 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 8.3% in 2020 through the end of May and still beat the market by 13.2 percentage points. Unfortunately IOVA wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on IOVA were disappointed as the stock returned 7.2% during the second quarter (through the end of May) 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.