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Hedge Funds Watching Xtant Medical Holdings, Inc. (XTNT) From Afar

A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended September 30, so let’s proceed with the discussion of the hedge fund sentiment on Xtant Medical Holdings, Inc. (NYSE:XTNT).

Xtant Medical Holdings, Inc. (NYSE:XTNT) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 3 hedge funds’ portfolios at the end of September. At the end of this article we will also compare XTNT to other stocks including Xcel Brands Inc (NASDAQ:XELB), Capstone Turbine Corporation (NASDAQ:CPST), and Actinium Pharmaceuticals Inc (NYSEMKT:ATNM) to get a better sense of its popularity.

At the moment there are many metrics market participants have at their disposal to value publicly traded companies. A duo of the most under-the-radar metrics are hedge fund and insider trading activity. Our researchers have shown that, historically, those who follow the best picks of the elite investment managers can outperform their index-focused peers by a solid amount (see the details here).

Samuel Isaly Orbimed Advisors

Samuel Isaly of OrbiMed Advisors

Unlike the largest US hedge funds that are convinced Dow will soar past 40,000 or the world’s most bearish hedge fund that’s more convinced than ever that a crash is coming, our long-short investment strategy doesn’t rely on bull or bear markets to deliver double digit returns. We only rely on the best performing hedge funds‘ buy/sell signals. Let’s check out the recent hedge fund action regarding Xtant Medical Holdings, Inc. (NYSE:XTNT).

How have hedgies been trading Xtant Medical Holdings, Inc. (NYSE:XTNT)?

Heading into the fourth quarter of 2019, a total of 3 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 0% from one quarter earlier. On the other hand, there were a total of 3 hedge funds with a bullish position in XTNT a year ago. With hedgies’ sentiment swirling, there exists a select group of noteworthy hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).

XTNT_nov2019

More specifically, OrbiMed Advisors was the largest shareholder of Xtant Medical Holdings, Inc. (NYSE:XTNT), with a stake worth $26.1 million reported as of the end of September. Trailing OrbiMed Advisors was Park West Asset Management, which amassed a stake valued at $3.6 million. Renaissance Technologies was 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 OrbiMed Advisors allocated the biggest weight to Xtant Medical Holdings, Inc. (NYSE:XTNT), around 0.5% of its portfolio. Park West Asset Management is also relatively very bullish on the stock, setting aside 0.17 percent of its 13F equity portfolio to XTNT.

Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Xtant Medical Holdings, Inc. (NYSE:XTNT) but similarly valued. These stocks are Xcel Brands Inc (NASDAQ:XELB), Capstone Turbine Corporation (NASDAQ:CPST), Actinium Pharmaceuticals Inc (NYSEMKT:ATNM), and Basic Energy Services, Inc (NYSE:BAS). This group of stocks’ market values are similar to XTNT’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
XELB 4 613 2
CPST 5 3897 0
ATNM 6 3882 0
BAS 8 11744 0
Average 5.75 5034 0.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 5.75 hedge funds with bullish positions and the average amount invested in these stocks was $5 million. That figure was $30 million in XTNT’s case. Basic Energy Services, Inc (NYSE:BAS) is the most popular stock in this table. On the other hand Xcel Brands Inc (NASDAQ:XELB) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks Xtant Medical Holdings, Inc. (NYSE:XTNT) is even less popular than XELB. Hedge funds dodged a bullet by taking a bearish stance towards XTNT. Our calculations showed that the top 20 most popular hedge fund stocks returned 34.7% in 2019 through November 22nd and outperformed the S&P 500 ETF (SPY) by 8.5 percentage points. Unfortunately XTNT wasn’t nearly as popular as these 20 stocks (hedge fund sentiment was very bearish); XTNT investors were disappointed as the stock returned -35.9% during the fourth quarter (through 11/22) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 70 percent of these stocks already outperformed the market so far in Q4.

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

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