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Hedge Funds Can’t Buy Enough Of Iovance Biotherapeutics, Inc. (IOVA)

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 at Insider Monkey have plowed through 823 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of June 30th, when the S&P 500 Index was trading around the 3100 level. Stocks kept going up since then. In this article we look at how hedge funds traded Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) and determine whether the smart money was really smart about this stock.

Is Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) a buy, sell, or hold? Money managers were taking a bullish view. The number of bullish hedge fund bets increased by 4 recently. Iovance Biotherapeutics, Inc. (NASDAQ:IOVA) was in 43 hedge funds’ portfolios at the end of the second quarter of 2020. The all time high for this statistics is 39. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that IOVA 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). There were 39 hedge funds in our database with IOVA positions at the end of the first quarter.

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

To most market participants, hedge funds are viewed as worthless, outdated investment tools of years past. While there are greater than 8000 funds with their doors open at present, We hone in on the aristocrats of this club, around 850 funds. These hedge fund managers administer most of the smart money’s total capital, and by following their matchless stock picks, Insider Monkey has figured out a few investment strategies that have historically defeated Mr. Market. Insider Monkey’s flagship short hedge fund strategy outstripped the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Our portfolio of short stocks lost 34% since February 2017 (through August 17th) even though the market was up 53% during the same period. We just shared a list of 8 short targets in our latest quarterly update .

Dmitry Balyasny of Balyasny Asset Managemnet

Dmitry Balyasny of Balyasny Asset Management

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, legal marijuana is one of the fastest growing industries right now, so we are checking out stock pitches like “the Starbucks of cannabis” to identify the next tenbagger. 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. Hedge fund sentiment towards Tesla reached its all time high at the end of 2019 and Tesla shares more than tripled this year. We are trying to identify other EV revolution winners, so if you have any good ideas send us an email. Now let’s take a look at the latest hedge fund action regarding Iovance Biotherapeutics, Inc. (NASDAQ:IOVA).

Hedge fund activity in Iovance Biotherapeutics, Inc. (NASDAQ:IOVA)

Heading into the third quarter of 2020, a total of 43 of the hedge funds tracked by Insider Monkey were long this stock, a change of 10% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards IOVA over the last 20 quarters. With hedgies’ sentiment swirling, there exists a few notable hedge fund managers who were adding to their stakes meaningfully (or already accumulated large positions).

Is IOVA A Good Stock To Buy?

Among these funds, Perceptive Advisors held the most valuable stake in Iovance Biotherapeutics, Inc. (NASDAQ:IOVA), which was worth $324.2 million at the end of the third quarter. On the second spot was Avoro Capital Advisors (venBio Select Advisor) which amassed $284.4 million worth of shares. OrbiMed Advisors, Farallon Capital, and Great Point Partners 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 Great Point Partners allocated the biggest weight to Iovance Biotherapeutics, Inc. (NASDAQ:IOVA), around 8.17% of its 13F portfolio. Avoro Capital Advisors (venBio Select Advisor) is also relatively very bullish on the stock, setting aside 5.62 percent of its 13F equity portfolio to IOVA.

With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Sphera Global Healthcare Fund, managed by Doron Breen and Mori Arkin, created the biggest position in Iovance Biotherapeutics, Inc. (NASDAQ:IOVA). Sphera Global Healthcare Fund had $9.6 million invested in the company at the end of the quarter. Anand Parekh’s Alyeska Investment Group also made a $8.5 million investment in the stock during the quarter. The following funds were also among the new IOVA investors: Donald Sussman’s Paloma Partners, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and Michael Gelband’s ExodusPoint Capital.

Let’s check out 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 TFS Financial Corporation (NASDAQ:TFSL), AerCap Holdings N.V. (NYSE:AER), Manpowergroup Inc (NYSE:MAN), Integra Lifesciences Holdings Corp (NASDAQ:IART), Darling Ingredients Inc. (NYSE:DAR), BOK Financial Corporation (NASDAQ:BOKF), and Wyndham Hotels & Resorts, Inc. (NYSE:WH). 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
TFSL 11 122677 2
AER 30 934619 -2
MAN 34 377077 11
IART 23 101326 1
DAR 25 403765 0
BOKF 17 203603 -5
WH 36 760057 5
Average 25.1 414732 1.7

View table here if you experience formatting issues.

As you can see these stocks had an average of 25.1 hedge funds with bullish positions and the average amount invested in these stocks was $415 million. That figure was $1342 million in IOVA’s case. Wyndham Hotels & Resorts, Inc. (NYSE:WH) is the most popular stock in this table. On the other hand TFS Financial Corporation (NASDAQ:TFSL) 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 overall hedge fund sentiment score for IOVA is 89. 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 returned 33% in 2020 through the end of August but still managed to beat the market by 23.2 percentage points. Hedge funds were also right about betting on IOVA as the stock returned 21.4% since the end of June and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.

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