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Is CRISPR Therapeutics AG (CRSP) Going to Burn These Hedge Funds?

The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors endured a torrid quarter, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards CRISPR Therapeutics AG (NASDAQ:CRSP).

Is CRISPR Therapeutics AG (NASDAQ:CRSP) a splendid stock to buy now? The smart money is taking a bearish view. The number of long hedge fund positions decreased by 1 recently. Our calculations also showed that CRSP isn’t among the 30 most popular stocks among hedge funds.

If you’d ask most shareholders, hedge funds are assumed to be unimportant, old financial vehicles of yesteryear. While there are over 8,000 funds trading at the moment, Our researchers look at the upper echelon of this group, approximately 700 funds. These money managers shepherd bulk of all hedge funds’ total asset base, and by paying attention to their unrivaled picks, Insider Monkey has uncovered a number of investment strategies that have historically outrun the broader indices. Insider Monkey’s flagship hedge fund strategy surpassed the S&P 500 index by 6 percentage points annually since its inception in May 2014 through early November 2018. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 24% since February 2017 (through December 3rd) even though the market was up nearly 23% during the same period. We just shared a list of 11 short targets in our latest quarterly update.

Samuel Isaly Orbimed Advisors

Let’s analyze the recent hedge fund action encompassing CRISPR Therapeutics AG (NASDAQ:CRSP).

How are hedge funds trading CRISPR Therapeutics AG (NASDAQ:CRSP)?

At the end of the third quarter, a total of 16 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -6% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards CRSP over the last 13 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were adding to their holdings meaningfully (or already accumulated large positions).


Among these funds, Farallon Capital held the most valuable stake in CRISPR Therapeutics AG (NASDAQ:CRSP), which was worth $45.2 million at the end of the third quarter. On the second spot was EcoR1 Capital which amassed $22.2 million worth of shares. Moreover, OrbiMed Advisors, Two Sigma Advisors, and Clough Capital Partners were also bullish on CRISPR Therapeutics AG (NASDAQ:CRSP), allocating a large percentage of their portfolios to this stock.

Due to the fact that CRISPR Therapeutics AG (NASDAQ:CRSP) has faced bearish sentiment from hedge fund managers, logic holds that there was a specific group of hedge funds that slashed their entire stakes last quarter. Interestingly, Jim Simons’s Renaissance Technologies sold off the biggest position of the “upper crust” of funds watched by Insider Monkey, totaling an estimated $10.1 million in stock, and Steven Boyd’s Armistice Capital was right behind this move, as the fund cut about $7.3 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest dropped by 1 funds last quarter.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as CRISPR Therapeutics AG (NASDAQ:CRSP) but similarly valued. We will take a look at Dillard’s, Inc. (NYSE:DDS), Forward Air Corporation (NASDAQ:FWRD), Hope Bancorp, Inc. (NASDAQ:HOPE), and KB Home (NYSE:KBH). This group of stocks’ market valuations match CRSP’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
DDS 16 153752 0
FWRD 15 100893 -1
HOPE 14 81903 7
KBH 17 331197 3
Average 15.5 166936 2.25

View table here if you experience formatting issues.

As you can see these stocks had an average of 15.5 hedge funds with bullish positions and the average amount invested in these stocks was $167 million. That figure was $172 million in CRSP’s case. KB Home (NYSE:KBH) is the most popular stock in this table. On the other hand Hope Bancorp, Inc. (NASDAQ:HOPE) is the least popular one with only 14 bullish hedge fund positions. CRISPR Therapeutics AG (NASDAQ:CRSP) 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. In this regard KBH might be a better candidate to consider a long position.

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

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