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Hedge Funds Never Been Less Bullish On Trevena Inc (TRVN)

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 821 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 March 31st, a week after the market trough. In this article we look at what those investors think of Trevena Inc (NASDAQ:TRVN).

Trevena Inc (NASDAQ:TRVN) was in 4 hedge funds’ portfolios at the end of the first quarter of 2020. TRVN investors should pay attention to a decrease in support from the world’s most elite money managers of late. There were 5 hedge funds in our database with TRVN positions at the end of the previous quarter. Our calculations also showed that TRVN 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).

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

At the moment there are a multitude of metrics market participants can use to value stocks. A couple of the most under-the-radar metrics are hedge fund and insider trading moves. Our experts have shown that, historically, those who follow the best picks of the top investment managers can beat the S&P 500 by a very impressive amount (see the details here).

John Overdeck of Two Sigma

John Overdeck of Two Sigma Advisors

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. 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. With all of this in mind we’re going to take a look at the fresh hedge fund action encompassing Trevena Inc (NASDAQ:TRVN).

How have hedgies been trading Trevena Inc (NASDAQ:TRVN)?

At Q1’s end, a total of 4 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -20% from the fourth quarter of 2019. On the other hand, there were a total of 6 hedge funds with a bullish position in TRVN a year ago. With the smart money’s sentiment swirling, there exists a select group of noteworthy hedge fund managers who were adding to their stakes meaningfully (or already accumulated large positions).

Is TRVN A Good Stock To Buy?

When looking at the institutional investors followed by Insider Monkey, Renaissance Technologies, holds the most valuable position in Trevena Inc (NASDAQ:TRVN). Renaissance Technologies has a $1.4 million position in the stock, comprising less than 0.1%% of its 13F portfolio. On Renaissance Technologies’s heels is Winton Capital Management, led by David Harding, holding a $0.3 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other professional money managers with similar optimism encompass Ken Griffin’s Citadel Investment Group, John Zaro’s Bourgeon Capital and . In terms of the portfolio weights assigned to each position Bourgeon Capital allocated the biggest weight to Trevena Inc (NASDAQ:TRVN), around 0.02% of its 13F portfolio. Winton Capital Management is also relatively very bullish on the stock, designating 0.01 percent of its 13F equity portfolio to TRVN.

Since Trevena Inc (NASDAQ:TRVN) has faced declining sentiment from the smart money, it’s easy to see that there is a sect of fund managers that elected to cut their full holdings by the end of the third quarter. Intriguingly, John Overdeck and David Siegel’s Two Sigma Advisors dumped the largest investment of the “upper crust” of funds followed by Insider Monkey, worth about $0 million in stock, and Michael Gelband’s ExodusPoint Capital was right behind this move, as the fund dumped about $0 million worth. These transactions are interesting, as aggregate hedge fund interest was cut by 1 funds by the end of the third quarter.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Trevena Inc (NASDAQ:TRVN) but similarly valued. These stocks are Strattec Security Corp. (NASDAQ:STRT), LMP Automotive Holdings, Inc. (NASDAQ:LMPX), Trevi Therapeutics, Inc. (NASDAQ:TRVI), and Bassett Furniture Industries Inc. (NASDAQ:BSET). This group of stocks’ market caps are closest to TRVN’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
STRT 4 9062 0
LMPX 1 292 0
TRVI 2 580 -2
BSET 10 10660 2
Average 4.25 5149 0

View table here if you experience formatting issues.

As you can see these stocks had an average of 4.25 hedge funds with bullish positions and the average amount invested in these stocks was $5 million. That figure was $2 million in TRVN’s case. Bassett Furniture Industries Inc. (NASDAQ:BSET) is the most popular stock in this table. On the other hand LMP Automotive Holdings, Inc. (NASDAQ:LMPX) is the least popular one with only 1 bullish hedge fund positions. Trevena Inc (NASDAQ:TRVN) is not the least popular stock in this group but hedge fund interest is still below average. 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. A small number of hedge funds were also right about betting on TRVN as the stock returned 129.3% during the second quarter and outperformed the market by an even larger margin.

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