Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Is Dynavax Technologies Corporation (DVAX) A Good Stock To Buy?

How do we determine whether Dynavax Technologies Corporation (NASDAQ:DVAX) makes for a good investment at the moment? We analyze the sentiment of a select group of the very best investors in the world, who spend immense amounts of time and resources studying companies. They may not always be right (no one is), but data shows that their consensus long positions have historically outperformed the market when we adjust for known risk factors.

Dynavax Technologies Corporation (NASDAQ:DVAX) investors should be aware of a decrease in activity from the world’s largest hedge funds recently. Our calculations also showed that DVAX isn’t among the 30 most popular stocks among hedge funds.

In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s flagship best performing hedge funds strategy returned 20.7% year to date (through March 12th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 32 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.

Oleg Nodelman EcoR1 Capital

We’re going to check out the key hedge fund action encompassing Dynavax Technologies Corporation (NASDAQ:DVAX).

Hedge fund activity in Dynavax Technologies Corporation (NASDAQ:DVAX)

At Q4’s end, a total of 18 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -5% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in DVAX over the last 14 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

DVAX_may2019

Among these funds, Healthcor Management LP held the most valuable stake in Dynavax Technologies Corporation (NASDAQ:DVAX), which was worth $38.6 million at the end of the fourth quarter. On the second spot was Rima Senvest Management which amassed $28.3 million worth of shares. Moreover, D E Shaw, Farallon Capital, and Brookside Capital were also bullish on Dynavax Technologies Corporation (NASDAQ:DVAX), allocating a large percentage of their portfolios to this stock.

Because Dynavax Technologies Corporation (NASDAQ:DVAX) has witnessed a decline in interest from the smart money, logic holds that there lies a certain “tier” of hedge funds who sold off their positions entirely by the end of the third quarter. Interestingly, Zach Schreiber’s Point State Capital said goodbye to the biggest stake of the 700 funds tracked by Insider Monkey, worth about $16.3 million in stock, and Steve Cohen’s Point72 Asset Management was right behind this move, as the fund dropped about $1.8 million worth. These bearish behaviors are interesting, as total hedge fund interest was cut by 1 funds by the end of the third quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Dynavax Technologies Corporation (NASDAQ:DVAX) but similarly valued. We will take a look at W&T Offshore, Inc. (NYSE:WTI), Triumph Group Inc (NYSE:TGI), Blue Hills Bancorp Inc (NASDAQ:BHBK), and HomeStreet Inc (NASDAQ:HMST). All of these stocks’ market caps resemble DVAX’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
WTI 21 56548 4
TGI 8 16478 1
BHBK 7 19541 -2
HMST 7 6175 1
Average 10.75 24686 1

View table here if you experience formatting issues.

As you can see these stocks had an average of 10.75 hedge funds with bullish positions and the average amount invested in these stocks was $25 million. That figure was $137 million in DVAX’s case. W&T Offshore, Inc. (NYSE:WTI) is the most popular stock in this table. On the other hand Blue Hills Bancorp Inc (NASDAQ:BHBK) is the least popular one with only 7 bullish hedge fund positions. Dynavax Technologies Corporation (NASDAQ:DVAX) 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 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Unfortunately DVAX wasn’t nearly as popular as these 15 stock and hedge funds that were betting on DVAX were disappointed as the stock returned -30.5% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.

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

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading...