We at Insider Monkey have gone over 821 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 March 31st, near the height of the coronavirus market crash. In this article, we look at what those funds think of Achieve Life Sciences, Inc. (NASDAQ:ACHV) based on that data.
Is Achieve Life Sciences, Inc. (NASDAQ:ACHV) ready to rally soon? Prominent investors are betting on the stock. The number of bullish hedge fund bets advanced by 3 lately. Our calculations also showed that ACHV 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.
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 51 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 36% through May 18th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Israel Englander of Millennium Management
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. Now let’s take a gander at the latest hedge fund action surrounding Achieve Life Sciences, Inc. (NASDAQ:ACHV).
What have hedge funds been doing with Achieve Life Sciences, Inc. (NASDAQ:ACHV)?
At the end of the first quarter, a total of 5 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 150% from the fourth quarter of 2019. On the other hand, there were a total of 3 hedge funds with a bullish position in ACHV a year ago. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).
More specifically, Pura Vida Investments was the largest shareholder of Achieve Life Sciences, Inc. (NASDAQ:ACHV), with a stake worth $0.4 million reported as of the end of September. Trailing Pura Vida Investments was Renaissance Technologies, which amassed a stake valued at $0.2 million. Citadel Investment Group, Millennium Management, and Two Sigma Advisors 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 Pura Vida Investments allocated the biggest weight to Achieve Life Sciences, Inc. (NASDAQ:ACHV), around 0.11% of its 13F portfolio. Renaissance Technologies is also relatively very bullish on the stock, earmarking 0.0002 percent of its 13F equity portfolio to ACHV.
With a general bullishness amongst the heavyweights, key money managers were breaking ground themselves. Citadel Investment Group, managed by Ken Griffin, initiated the most outsized position in Achieve Life Sciences, Inc. (NASDAQ:ACHV). Citadel Investment Group had $0 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made a $0 million investment in the stock during the quarter. The only other fund with a new position in the stock is John Overdeck and David Siegel’s Two Sigma Advisors.
Let’s go over hedge fund activity in other stocks similar to Achieve Life Sciences, Inc. (NASDAQ:ACHV). We will take a look at Conatus Pharmaceuticals Inc (NASDAQ:CNAT), Monaker Group, Inc. (NASDAQ:MKGI), AEterna Zentaris Inc. (NASDAQ:AEZS), and PDS Biotechnology Corporation (NASDAQ:PDSB). This group of stocks’ market caps resemble ACHV’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CNAT | 2 | 90 | 1 |
| MKGI | 1 | 209 | 0 |
| AEZS | 2 | 69 | -2 |
| PDSB | 4 | 340 | 2 |
| Average | 2.25 | 177 | 0.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 2.25 hedge funds with bullish positions and the average amount invested in these stocks was $0 million. That figure was $1 million in ACHV’s case. PDS Biotechnology Corporation (NASDAQ:PDSB) is the most popular stock in this table. On the other hand Monaker Group, Inc. (NASDAQ:MKGI) is the least popular one with only 1 bullish hedge fund positions. Compared to these stocks Achieve Life Sciences, Inc. (NASDAQ:ACHV) 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 returned 8.3% in 2020 through the end of May but still managed to beat the market by 13.2 percentage points. Hedge funds were also right about betting on ACHV as the stock returned 24.2% so far in Q2 (through the end of May) 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.
Follow Achieve Life Sciences Inc. (NASDAQ:ACHV)
Follow Achieve Life Sciences Inc. (NASDAQ:ACHV)
Disclosure: None. This article was originally published at Insider Monkey.