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 CytomX Therapeutics, Inc. (NASDAQ:CTMX) based on that data.
Hedge fund interest in CytomX Therapeutics, Inc. (NASDAQ:CTMX) shares was flat at the end of last quarter. This is usually a negative indicator. At the end of this article we will also compare CTMX to other stocks including Rosetta Stone Inc (NYSE:RST), Utah Medical Products, Inc. (NASDAQ:UTMD), and Tekla Life Sciences Investors (NYSE:HQL) to get a better sense of its popularity.
Video: 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 was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 58 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.
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 trades 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 let’s view the new hedge fund action encompassing CytomX Therapeutics, Inc. (NASDAQ:CTMX).
What have hedge funds been doing with CytomX Therapeutics, Inc. (NASDAQ:CTMX)?
At the end of the first quarter, a total of 22 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from the previous quarter. On the other hand, there were a total of 18 hedge funds with a bullish position in CTMX a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Biotechnology Value Fund / BVF Inc, managed by Mark Lampert, holds the largest position in CytomX Therapeutics, Inc. (NASDAQ:CTMX). Biotechnology Value Fund / BVF Inc has a $30.1 million position in the stock, comprising 2.8% of its 13F portfolio. On Biotechnology Value Fund / BVF Inc’s heels is Perceptive Advisors, managed by Joseph Edelman, which holds a $25 million position; 0.7% of its 13F portfolio is allocated to the company. Some other hedge funds and institutional investors that hold long positions contain Renaissance Technologies, D. E. Shaw’s D E Shaw and John Overdeck and David Siegel’s Two Sigma Advisors. In terms of the portfolio weights assigned to each position Burrage Capital Management allocated the biggest weight to CytomX Therapeutics, Inc. (NASDAQ:CTMX), around 3.41% of its 13F portfolio. Biotechnology Value Fund / BVF Inc is also relatively very bullish on the stock, designating 2.8 percent of its 13F equity portfolio to CTMX.
Due to the fact that CytomX Therapeutics, Inc. (NASDAQ:CTMX) has experienced bearish sentiment from the aggregate hedge fund industry, we can see that there exists a select few fund managers that elected to cut their positions entirely last quarter. It’s worth mentioning that Minhua Zhang’s Weld Capital Management cut the biggest investment of all the hedgies monitored by Insider Monkey, comprising an estimated $0.7 million in stock. Michael Gelband’s fund, ExodusPoint Capital, also dumped its stock, about $0.3 million worth. These moves are interesting, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Let’s check out hedge fund activity in other stocks similar to CytomX Therapeutics, Inc. (NASDAQ:CTMX). These stocks are Rosetta Stone Inc (NYSE:RST), Utah Medical Products, Inc. (NASDAQ:UTMD), Tekla Life Sciences Investors (NYSE:HQL), and Realogy Holdings Corp (NYSE:RLGY). All of these stocks’ market caps are closest to CTMX’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.5 hedge funds with bullish positions and the average amount invested in these stocks was $59 million. That figure was $99 million in CTMX’s case. Realogy Holdings Corp (NYSE:RLGY) is the most popular stock in this table. On the other hand Tekla Life Sciences Investors (NYSE:HQL) is the least popular one with only 1 bullish hedge fund positions. CytomX Therapeutics, Inc. (NASDAQ:CTMX) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. 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 13.9% in 2020 through June 10th but beat the market by 14.2 percentage points. Unfortunately CTMX wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on CTMX were disappointed as the stock returned 3.4% during the same time period 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 many of these stocks already outperformed the market so far this year.
Disclosure: None. This article was originally published at Insider Monkey.