Is Trinity Biotech plc (NASDAQ:TRIB) a good place to invest some of your money right now? We can gain invaluable insight to help us answer that question by studying the investment trends of top investors, who employ world-class Ivy League graduates, who are given immense resources and industry contacts to put their financial expertise to work. The top picks of these firms have historically outperformed the market when we account for known risk factors, making them very valuable investment ideas.
Is Trinity Biotech plc (NASDAQ:TRIB) undervalued? The smart money was in a pessimistic mood. The number of long hedge fund bets dropped by 2 recently. Trinity Biotech plc (NASDAQ:TRIB) was in 3 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistics is 20. Our calculations also showed that TRIB isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks). There were 5 hedge funds in our database with TRIB holdings at the end of June.
Video: Watch our video about the top 5 most popular hedge fund stocks.
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 monthly stock picks returned 113% since March 2017 and outperformed the S&P 500 ETFs by more than 66 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
Ken Griffin of Citadel Investment Group
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Keeping this in mind let’s take a gander at the latest hedge fund action regarding Trinity Biotech plc (NASDAQ:TRIB).
Hedge fund activity in Trinity Biotech plc (NASDAQ:TRIB)
At Q3’s end, a total of 3 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -40% from the second quarter of 2020. By comparison, 5 hedge funds held shares or bullish call options in TRIB a year ago. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Renaissance Technologies held the most valuable stake in Trinity Biotech plc (NASDAQ:TRIB), which was worth $3.4 million at the end of the third quarter. On the second spot was Citadel Investment Group which amassed $0.1 million worth of shares. Citadel Investment Group 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 Renaissance Technologies allocated the biggest weight to Trinity Biotech plc (NASDAQ:TRIB), around 0.0034% of its 13F portfolio. Millennium Management is also relatively very bullish on the stock, setting aside 0 percent of its 13F equity portfolio to TRIB.
Seeing as Trinity Biotech plc (NASDAQ:TRIB) has witnessed a decline in interest from the entirety of the hedge funds we track, we can see that there is a sect of hedgies who were dropping their positions entirely by the end of the third quarter. At the top of the heap, Ken Griffin’s Citadel Investment Group said goodbye to the largest position of all the hedgies tracked by Insider Monkey, worth close to $16.4 million in stock, and Ali Motamed’s Invenomic Capital Management was right behind this move, as the fund cut about $0.3 million worth. These moves are important to note, as aggregate hedge fund interest was cut by 2 funds by the end of the third quarter.
Let’s go over hedge fund activity in other stocks similar to Trinity Biotech plc (NASDAQ:TRIB). These stocks are Neovasc Inc. (NASDAQ:NVCN), Universal Stainless & Alloy Products (NASDAQ:USAP), Broadwind Inc. (NASDAQ:BWEN), IZEA Worldwide Inc. (NASDAQ:IZEA), AmeriServ Financial, Inc. (NASDAQ:ASRV), Gulf Island Fabrication, Inc. (NASDAQ:GIFI), and Hallmark Financial Services, Inc. (NASDAQ:HALL). This group of stocks’ market values are closest to TRIB’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| NVCN | 5 | 4806 | 1 |
| USAP | 7 | 9992 | 1 |
| BWEN | 7 | 5334 | 3 |
| IZEA | 1 | 22 | 0 |
| ASRV | 3 | 4529 | 0 |
| GIFI | 6 | 6449 | -1 |
| HALL | 7 | 2053 | -3 |
| Average | 5.1 | 4741 | 0.1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.1 hedge funds with bullish positions and the average amount invested in these stocks was $5 million. That figure was $4 million in TRIB’s case. Universal Stainless & Alloy Products (NASDAQ:USAP) is the most popular stock in this table. On the other hand IZEA Worldwide Inc. (NASDAQ:IZEA) is the least popular one with only 1 bullish hedge fund positions. Trinity Biotech plc (NASDAQ:TRIB) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for TRIB is 24.2. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 28.1% in 2020 through November 23rd and still beat the market by 15.4 percentage points. A small number of hedge funds were also right about betting on TRIB as the stock returned 75.2% since the end of the third quarter (through 11/23) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.
