In this article, we discuss the top 10 healthcare stock picks of Timothy P. Lynch’s Stonepine Capital. If you want to skip our detailed analysis of these stocks, go directly to Timothy P. Lynch’s Stonepine Capital Portfolio: Top 5 Healthcare Stocks.
Timothy Lynch is the managing member at Stonepine Capital, which is an investment management firm based in Bend, Oregon. The Q3 13F portfolio at Stonepine Capital is primarily focused on the life science industry, with the largest stock holding being Amryt Pharma plc (NASDAQ:AMYT), which represents 31.79% of the firm’s total securities.
Timothy Lynch attended the Colgate University and Harvard Business School, and began his career as an investment banker, serving at The Goldman Sachs Group, Inc. (NYSE:GS) and Chase Manhattan Bank. Lynch then joined Elan Corporation as the director of strategic planning, and executed acquisitions and corporate financings. After Elan, he joined InterMune, Inc. as the chief financial officer, a private start-up that he turned into a success. Timothy Lynch was also the CFO at Tercica, Inc., a start-up that he played an instrumental role in developing and managing. After Tercica, he moved on to Stonepine Capital, where he has been working for 12 years now.
As per the 13F filings from Q3 2021, Stonepine Capital has a portfolio valued at $219.76 million, and assets under management of $246.86 million. Almost 97% of Lynch’s Q3 portfolio consists of healthcare stocks.
The top stocks from Timothy Lynch’s portfolio as of September this year include Amryt Pharma plc (NASDAQ:AMYT), CTI BioPharma Corp. (NASDAQ:CTIC), Adamas Pharmaceuticals, Inc. (NASDAQ:ADMS), and Galapagos NV (NASDAQ:GLPG), among others discussed in detail below.
Our Methodology
We used the Q3 portfolio of Timothy Lynch to compile a list of his top 10 stock picks from the healthcare sector. The stocks are ranked according to Timothy Lynch’s Stonepine Capital’s stake value in each holding.
For an in-depth context about each company, we have mentioned the Q3 earnings, analyst ratings, and the hedge fund sentiment surrounding each stock.
Timothy P. Lynch’s Stonepine Capital Portfolio: Top Healthcare Stocks
10. Gamida Cell Ltd. (NASDAQ:GMDA)
Stonepine Capital’s Stake Value: $6,759,000
Percentage of Stonepine Capital’s 13F Portfolio: 3.07%
Number of Hedge Fund Holders: 12
Gamida Cell Ltd. (NASDAQ:GMDA), a company engaged in complex cell therapy to treat blood diseases and blood cancer, is one of the top stock picks of Timothy Lynch from the third quarter, with his investment firm holding 1.72 million shares in the company, worth $6.75 million. Gamida Cell Ltd. (NASDAQ:GMDA) represents 3.07% of Stonepine Capital’s Q3 13F securities.
As of September this year, 12 hedge funds in the database of Insider Monkey reported owning stakes in Gamida Cell Ltd. (NASDAQ:GMDA), valued at $26.6 million. This is compared to 14 funds being bullish on Gamida Cell Ltd. (NASDAQ:GMDA) in the preceding quarter, with a total stake value of $53.2 million.
Gamida Cell Ltd. (NASDAQ:GMDA) announced Q3 earnings on November 15, with EPS for the quarter being -$0.33, beating estimates by $0.15. Following the Q3 results, Oppenheimer analyst Mark Breidenbach on November 16 lowered the price target on Gamida Cell Ltd. (NASDAQ:GMDA) to $15 from $17 and kept an Outperform rating on the stock.
The leading Gamida Cell Ltd. (NASDAQ:GMDA) stakeholder as of Q3 is Rock Springs Capital Management, with 2.14 million shares amounting to $8.4 million.
In addition to Amryt Pharma plc (NASDAQ:AMYT), CTI BioPharma Corp. (NASDAQ:CTIC), Adamas Pharmaceuticals, Inc. (NASDAQ:ADMS), and Galapagos NV (NASDAQ:GLPG), Gamida Cell Ltd. (NASDAQ:GMDA) is a notable stock from Timothy Lynch’s Q3 portfolio.
9. Affimed N.V. (NASDAQ:AFMD)
Stonepine Capital’s Stake Value: $7,178,000
Percentage of Stonepine Capital’s 13F Portfolio: 3.26%
Number of Hedge Fund Holders: 19
Affimed N.V. (NASDAQ:AFMD), a clinical stage biopharmaceutical company specializing in immuno-oncology therapies, posted its Q3 earnings on November 10. EPS in the period totaled -$0.16, beating expected EPS by $0.03. The $9.94 million revenue was down 20.13% from the prior-year quarter, but outperformed estimates by $1.34 million. On November 17, Berenberg analyst Zhiqiang Shu initiated coverage of Affimed N.V. (NASDAQ:AFMD) with a Buy rating and a $11 price target.
Timothy Lynch’s Stonepine Capital holds 1.16 million shares in Affimed N.V. (NASDAQ:AFMD), worth $7.1 million, representing 3.26% of the firm’s total investments from the third quarter.
Of the 867 hedge funds tracked by Insider Monkey at the end of September this year, 19 funds were long Affimed N.V. (NASDAQ:AFMD), with total stakes valued at $156.3 million. The leading stakeholder of the company is Ari Zweiman’s 683 Capital Partners, with a $34.6 million stake in the company.
8. Apollo Endosurgery, Inc. (NASDAQ:APEN)
Stonepine Capital’s Stake Value: $8,264,000
Percentage of Stonepine Capital’s 13F Portfolio: 3.76%
Number of Hedge Fund Holders: 10
Offering an alternative to invasive surgeries, Apollo Endosurgery, Inc. (NASDAQ:APEN) develops medical devices that treat a variety of gastrointestinal conditions in a less invasive manner. Stonepine Capital holds an $8.26 million stake in Apollo Endosurgery, Inc. (NASDAQ:APEN), which accounts for 3.76% of the firm’s Q3 13F portfolio.
Apollo Endosurgery, Inc. (NASDAQ:APEN) reported Q3 results on November 1. EPS in the period equaled -$0.23, exceeding estimates by $0.05. The $16.35 million revenue for the third quarter was up 27.48% from the previous-year quarter, beating estimated revenue by $0.88 million.
Wilmot B. Harkey and Daniel Mack’s Nantahala Capital Management is the leading shareholder of Apollo Endosurgery, Inc. (NASDAQ:APEN), with 2.51 million shares worth $22.78 million. Overall, Insider Monkey’s Q3 database reported that 10 hedge funds were bullish on Apollo Endosurgery, Inc. (NASDAQ:APEN), with a total stake value of $61.73 million.
7. Strongbridge Biopharma PLC (NASDAQ:SBBP)
Stonepine Capital’s Stake Value: $9,159,000
Percentage of Stonepine Capital’s 13F Portfolio: 4.16%
Number of Hedge Fund Holders: 11
Strongbridge Biopharma PLC (NASDAQ:SBBP) is a company focused on creating treatments for rare neuromuscular and endocrine conditions. On October 5 2021, Strongbridge Biopharma PLC (NASDAQ:SBBP) was acquired by Xeris Biopharma Holdings, Inc. (NASDAQ:XERS). Timothy Lynch, via Stonepine Capital, holds a $9.1 million stake in the company as of Q3, which accounts for 4.16% of the firm’s total investments.
As of the third quarter of 2021, 11 hedge funds in the database of Insider Monkey were long Strongbridge Biopharma PLC (NASDAQ:SBBP), with a total stake value of $29.8 million. This is comparable to 12 funds being bullish on the company in the previous quarter, with total stakes amounting to $39.6 million.
David Rosen’s Rubric Capital Management is one of the leading Strongbridge Biopharma PLC (NASDAQ:SBBP) stakeholders, holding over 3 million shares worth $6.26 million.
6. Catalyst Biosciences, Inc. (NASDAQ:CBIO)
Stonepine Capital’s Stake Value: $10,830,000
Percentage of Stonepine Capital’s 13F Portfolio: 4.92%
Number of Hedge Fund Holders: 17
Catalyst Biosciences, Inc. (NASDAQ:CBIO), one of the top stocks from Lynch’s Q3 portfolio, is a clinical research and development biopharmaceutical company offering protease therapeutics that treat disorders of the complement system. Stonepine Capital holds a $10.83 million position in Catalyst Biosciences, Inc. (NASDAQ:CBIO), representing 4.92% of the firm’s total investments.
Catalyst Biosciences, Inc. (NASDAQ:CBIO) announced that it would pause the clinical development of its primary asset, MarzAA. Piper Sandler analyst Christopher Raymond lowered the price target on Catalyst Biosciences, Inc. (NASDAQ:CBIO) to $4 from $16 and kept an Overweight rating on the shares on November 12.
As of Q3 2021, 17 hedge funds in the database of Insider Monkey were long Catalyst Biosciences, Inc. (NASDAQ:CBIO), with total stakes valued at $48.65 million. This is compared to 13 funds holding stakes in the company worth $54.1 million in the previous quarter.
In addition to Amryt Pharma plc (NASDAQ:AMYT), CTI BioPharma Corp. (NASDAQ:CTIC), Adamas Pharmaceuticals, Inc. (NASDAQ:ADMS), and Galapagos NV (NASDAQ:GLPG), Catalyst Biosciences, Inc. (NASDAQ:CBIO) is a notable stock from Timothy Lynch’s Q3 portfolio.
Click to continue reading and see Timothy P. Lynch’s Stonepine Capital Portfolio: Top 5 Healthcare Stocks.
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Disclosure: None. Timothy P. Lynch’s Stonepine Capital Portfolio: Top 10 Healthcare Stocks is originally published on Insider Monkey.
