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Should You Buy Theravance Inc (THRX)?

We know that hedge funds generate strong, risk-adjusted returns over the long run, therefore imitating the picks that they are collectively bullish on can be a profitable strategy for retail investors. With billions of dollars in assets, smart money investors have to conduct complex analyses, spend many resources and use tools that are not always available for the general crowd. This doesn’t mean that they don’t have occasional colossal losses; they do (like Ackman’s recent Valeant losses). However, it is still good idea to keep an eye on hedge fund activity. With this in mind, as the current round of 13F filings has just ended, let’s examine the smart money sentiment towards Theravance Inc (NASDAQ:THRX).

Is Theravance Inc (NASDAQ:THRX) a bargain? Investors who are in the know are becoming hopeful. The number of bullish hedge fund bets advanced by 9 in recent months. At the end of this article we will also compare THRX to other stocks including Veeco Instruments Inc. (NASDAQ:VECO), BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX), and Lifelock Inc (NYSE:LOCK) to get a better sense of its popularity.

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With all of this in mind, let’s analyze the new action surrounding Theravance Inc (NASDAQ:THRX).

How have hedgies been trading Theravance Inc (NASDAQ:THRX)?

At Q3’s end, a total of 20 of the hedge funds tracked by Insider Monkey were long this stock, a change of 82% from the second quarter. With hedgies’ sentiment swirling, there exists a select group of key hedge fund managers who were boosting their stakes meaningfully (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Seth Klarman’s Baupost Group has the number one position in Theravance Inc (NASDAQ:THRX), worth close to $142.3 million, amounting to 2.4% of its total 13F portfolio. Coming in second is Iridian Asset Management, led by David Cohen and Harold Levy, holding a $89.8 million position; the fund has 0.8% of its 13F portfolio invested in the stock. Remaining peers that hold long positions consist of Michael A. Price and Amos Meron’s Empyrean Capital Partners, Jamie Zimmerman’s Litespeed Management and Richard Perry’s Perry Capital.

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