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Hedge Funds Have Never Been This Bullish On CohBar, Inc. (CWBR)

We at Insider Monkey have gone over 752 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds’ and investors’ portfolio positions as of September 30th. In this article, we look at what those funds think of CohBar, Inc. (NASDAQ:CWBR) based on that data.

Is CohBar, Inc. (NASDAQ:CWBR) a bargain? Hedge funds are taking an optimistic view. The number of long hedge fund bets advanced by 2 recently. Our calculations also showed that CWBR isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings). CWBR was in 4 hedge funds’ portfolios at the end of September. There were 2 hedge funds in our database with CWBR positions at the end of the previous quarter.
5 Most Popular Stocks Among Hedge Funds
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.

Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the Russell 2000 ETFs by 40 percentage points since May 2014 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.

CITADEL INVESTMENT GROUP

Ken Griffin of Citadel Investment Group

We leave no stone unturned when looking for the next great investment idea. For example Discover is offering this insane cashback card, so we look into shorting the stock. One of the most bullish analysts in America just put his money where his mouth is. He says, “I’m investing more today than I did back in early 2009.” So we check out his pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We even check out this option genius’ weekly trade ideas. This December, we recommended Adams Energy as a one-way bet based on an under-the-radar fund manager’s investor letter and the stock already gained 20 percent. Now let’s check out the recent hedge fund action surrounding CohBar, Inc. (NASDAQ:CWBR).

What does smart money think about CohBar, Inc. (NASDAQ:CWBR)?

At the end of the third quarter, a total of 4 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 100% from the previous quarter. By comparison, 0 hedge funds held shares or bullish call options in CWBR a year ago. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

When looking at the institutional investors followed by Insider Monkey, Israel Englander’s Millennium Management has the number one position in CohBar, Inc. (NASDAQ:CWBR), worth close to $0.4 million, corresponding to less than 0.1%% of its total 13F portfolio. The second largest stake is held by Paloma Partners, led by Donald Sussman, holding a $0.1 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other peers that are bullish consist of Ken Griffin’s Citadel Investment Group, Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners and . In terms of the portfolio weights assigned to each position Paloma Partners allocated the biggest weight to CohBar, Inc. (NASDAQ:CWBR), around 0.0021% of its 13F portfolio. LMR Partners is also relatively very bullish on the stock, designating 0.0009 percent of its 13F equity portfolio to CWBR.

As industrywide interest jumped, key money managers were leading the bulls’ herd. Citadel Investment Group, managed by Ken Griffin, established the most outsized position in CohBar, Inc. (NASDAQ:CWBR). Citadel Investment Group had $0 million invested in the company at the end of the quarter.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as CohBar, Inc. (NASDAQ:CWBR) but similarly valued. We will take a look at Lincoln Educational Services Corporation (NASDAQ:LINC), Ascena Retail Group Inc (NASDAQ:ASNA), Vermillion, Inc. (NASDAQ:VRML), and Teligent, Inc. (NASDAQ:TLGT). This group of stocks’ market values resemble CWBR’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
LINC 4 12664 -1
ASNA 12 10244 0
VRML 4 2683 1
TLGT 7 11557 -1
Average 6.75 9287 -0.25

View table here if you experience formatting issues.

As you can see these stocks had an average of 6.75 hedge funds with bullish positions and the average amount invested in these stocks was $9 million. That figure was $1 million in CWBR’s case. Ascena Retail Group Inc (NASDAQ:ASNA) is the most popular stock in this table. On the other hand Lincoln Educational Services Corporation (NASDAQ:LINC) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks CohBar, Inc. (NASDAQ:CWBR) is even less popular than LINC. Hedge funds clearly dropped the ball on CWBR as the stock delivered strong returns, though hedge funds’ consensus picks still generated respectable returns. Our calculations showed that top 20 most popular stocks among hedge funds returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. A small number of hedge funds were also right about betting on CWBR as the stock returned 34.6% during the fourth quarter (through the end of November) and outperformed the market by an even larger margin.

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

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