Should You Avoid Theravance Biopharma Inc (TBPH)?

Because Theravance Biopharma Inc (NASDAQ:TBPH) has witnessed a declination in interest from hedge fund managers, it’s safe to say that there were a few funds that elected to cut their full holdings in the third quarter. Interestingly, Steven Boyd’s Armistice Capital dropped the biggest position of all the hedgies tracked by Insider Monkey, worth an estimated $12.7 million in stock, and Jim Simons’s Renaissance Technologies was right behind this move, as the fund dropped about $3.4 million worth. These transactions are intriguing to say the least, as total hedge fund interest fell by 3 funds in the third quarter.

Let’s also examine hedge fund activity in other stocks similar to Theravance Biopharma Inc (NASDAQ:TBPH). We will take a look at Kirkland’s, Inc. (NASDAQ:KIRK), XO Group Inc (NYSE:XOXO), Keryx Biopharmaceuticals (NASDAQ:KERX), and Mistras Group, Inc. (NYSE:MG). This group of stocks’ market caps match TBPH’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
KIRK 11 46620 -4
XOXO 16 108910 -1
KERX 16 122562 -2
MG 11 38747 1

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 $79 million. That figure was $105 million in TBPH’s case. XO Group Inc (NYSE:XOXO) is the most popular stock in this table. On the other hand Kirkland’s, Inc. (NASDAQ:KIRK) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks Theravance Biopharma Inc (NASDAQ:TBPH) is even less popular than KIRK. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.