In this article, we discuss the top 10 stock picks of Eli Casdin’s Casdin Capital.
Unprecedented inflation, increasing interest rates, and a worldwide recession pose risks to the 10-year upward trend in the S&P 500 index in the United States (SPX). With a 16% decline this year, the S&P 500 stock index is on track to have its most challenging year since 2008. As a result, the performance of hedge funds is anticipated to be at its lowest point in ten years, indicating that stock-picking tactics may be losing favor. In the year ending July 31, the global cumulative returns of stock-buying and stock-selling funds fell 12.24%. Year-to-date results for 2022 have declined by 11.42%.
Eli Casdin’s Casdin Capital portfolio value also decreased from $2.23 billion in Q1 to $1.18 billion in Q2 2022. It is a hedge fund located in New York and was established in 2011. As of October 2020, the hedge fund was managing about $2.2 billion in assets. The fund made five new purchases in the second quarter, made additional purchases in 2 stocks, sold out of 12 equities, and reduced holdings in 19 stocks.
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Casdin Capital invests in early-stage to late-stage private enterprises and operates a long-short equity fund. In the second quarter of 2022, the hedge fund made investments primarily in the medical (76.46%) sector. It is in a good position to profit from a disruptive, undervalued technology transition that is now taking place in the life sciences and healthcare sector. Investment possibilities are available throughout the healthcare spectrum and in industries including manufacturing, agriculture, and conventional information technology. Due to its extensive engagement and experience, Casdin Capital is one of the few knowledgeable investors in the field. Some of the notable holdings in the healthcare sector include Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX), McKesson Corporation (NYSE:MCK), and Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY).
Our Methodology
We have selected the top 10 stocks from Eli Casdin’s second quarter 13F holdings. We have assessed the hedge fund sentiment from Insider Monkey’s database of 895 elite hedge funds tracked as of the end of the second quarter of 2022.
Top Stock Picks of Eli Casdin’s Casdin Capital
10. Verve Therapeutics, Inc. (NASDAQ:VERV)
Casdin Capital’s Stake Value: $47,951,000
Percentage of Casdin Capital’s 13F Portfolio: 4.05%
Number of Hedge Fund Holders: 19
Verve Therapeutics, Inc. (NASDAQ:VERV) is a genetic pharmaceuticals firm working on a novel approach for the treatment of cardiovascular disease. Eli Casdin’s Casdin Capital owned 3.14 million shares of Verve Therapeutics, Inc. in Q2 2022, worth around $47.95 million. The company has featured on Casdin’s portfolio since the second quarter of 2021.
Given his cautious outlook on VERVE-101, Credit Suisse analyst Richard Law initiated coverage of Verve Therapeutics, Inc. on October 6, assigning the stock a ‘Neutral’ rating and a $48 price target. Verve Therapeutics, Inc. developed the novel experimental gene editing medication VERVE-101 as a single-course treatment to permanently silence the PCSK9 gene in the liver and reduce disease-causing low-density lipoprotein cholesterol (LDL-C).
19 out of the 895 hedge funds tracked by Insider Monkey held stakes in Verve Therapeutics, Inc. in the second quarter of 2022, worth $200.48 million, compared to the same number of funds in the preceding quarter, holding stakes in Verve Therapeutics, Inc. valued at $272.48 million.
Just like Vertex Pharmaceuticals Incorporated, McKesson Corporation, and Alnylam Pharmaceuticals, Inc., Verve Therapeutics, Inc. is a notable stock to consider.
9. Sarepta Therapeutics, Inc. (NASDAQ:SRPT)
Casdin Capital’s Stake Value: $48,724,000
Percentage of Casdin Capital’s 13F Portfolio: 4.11%
Number of Hedge Fund Holders: 41
Sarepta Therapeutics, Inc. (NASDAQ:SRPT) is a commercial stage bio-pharmaceutical company that specialises in the research and development of RNA-targeted medicines, gene therapies, and other genetic therapeutic modalities for the treatment of uncommon ailments.
As of September 8, Morgan Stanley analyst Matthew Harrison maintained an ‘Equal Weight’ rating on Sarepta Therapeutics, Inc. shares due to his worries over the Phase 3 EMBARK trial and his conservative estimate of the study’s 60% probability of success. However, he raised his price objective on Sarepta Therapeutics, Inc. from $100 to $135 since he realised that the share price does not yet fully represent the option value associated with an early filing.
According to regulatory filings for the second quarter, Eli Casdin’s Casdin Capital owned 650,000 shares of Sarepta Therapeutics, Inc. worth $48.72 million, which represented 4.11% of the fund’s overall portfolio. The hedge fund reduced its stake in the firm by 19% in the second quarter of 2022.
At the end of the second quarter of 2022, 41 hedge funds in the database of Insider Monkey held stakes worth $1.38 billion in Sarepta Therapeutics, Inc., down from 42 the preceding quarter worth $1.33 billion.
8. Fate Therapeutics, Inc. (NASDAQ:FATE)
Casdin Capital’s Stake Value: $52,038,000
Percentage of Casdin Capital’s 13F Portfolio: 4.39%
Number of Hedge Fund Holders: 23
Fate Therapeutics, Inc. (NASDAQ:FATE) is an American clinical-stage bio-pharmaceutical firm. It is working on programmed cellular immuno-therapies for cancer and immunological diseases. In the second quarter, Casdin Capital sold 1.30 million shares of Fate Therapeutics, Inc., reducing its stake by about 39%. At of the end of the quarter, the hedge fund still held more than 2.10 million shares of Fate, worth about $52.04 million. The company stands eighth on the list of top 10 stock picks of Eli Casdin’s Casdin Capital.
Canaccord analyst Bill Maughan initiated coverage of Fate Therapeutics, Inc. on October 10, assigning the stock a ‘Buy’ rating and a $42 price target. With many years of clinical development expertise and nine clinical initiatives, Fate is one of the most advanced natural killer (NK) cell firms in clinical research, according to Maughan.
Out of the hedge funds tracked by Insider Monkey, 23 hedge funds were long Fate Therapeutics, Inc. during the second quarter with aggregate stakes worth $774.28 million. This is compared to 31 hedge funds in the prior quarter which held $1.26 billion worth of positions in Fate Therapeutics, Inc..
7. SomaLogic, Inc. (NASDAQ:SLGC)
Casdin Capital’s Stake Value: $55,999,000
Percentage of Casdin Capital’s 13F Portfolio: 4.73%
Number of Hedge Fund Holders: 30
SomaLogic, Inc. (NASDAQ:SLGC), based in Boulder, Colorado, is a protein biomarker research and clinical diagnostics firm. Casdin Capital, the leading shareholder in SomaLogic, Inc. during Q2 2022, held 12.39 million shares of the firm valued at roughly $56 million and representing 4.73% of the fund’s total holdings. With a market capitalization of $570.539 million, SomaLogic, Inc. has generated returns of 6.55% to its shareholders over the past one month as of October 26.
On August 16, Cowen analyst Dan Brennan maintained an ‘Outperform’ rating while reducing his price objective on SomaLogic, Inc. from $11 to $9. The analyst asserted that investors were preparing for a bad conclusion even though there has never been a decline in large pharma demand.
The number of hedge funds tracked by Insider Monkey having stakes in SomaLogic, Inc. fell to 30 in Q2 2022 from 37 in the previous quarter. The hedge funds held stakes in the firm worth $167.51 million in Q2, down from $434.57 million in Q1.
6. Blueprint Medicines Corporation (NASDAQ:BPMC)
Casdin Capital’s Stake Value: $58,087,000
Percentage of Casdin Capital’s 13F Portfolio: 4.91%
Number of Hedge Fund Holders: 26
Blueprint Medicines Corporation (NASDAQ:BPMC) is a multinational precision therapy firm that develops treatments for cancer and blood diseases. Cadian Capital is the top shareholder of Blueprint Medicines Corporation, with a stake consisting of more than 2.02 million shares worth approximately $102.06 million.
Berenberg analyst Zhiqiang Shu initiated coverage of Blueprint Medicines Corporation on September 14, assigning the stock a ‘Buy’ rating and a $90 price target. Shu claimed that Blueprint has a history of using its unique discovery engine to produce novel drugs.
Eli Casdin’s Casdin Capital, according to 13F filings for the second quarter, owned 1.15 million shares of Blueprint Medicines Corporation worth $58.09 million. The hedge fund’s stake in Blueprint Medicines Corporation decreased by 26% in the second quarter, and represented 4.91% of its overall holdings.
Out of all the hedge funds tracked by Insider Monkey, 26 were long Blueprint Medicines Corporation in the second quarter of 2022, with aggregate stakes worth $458.34 million, as compared to 29 hedge funds with stakes worth $650.58 million in the earlier quarter.
In addition to Vertex Pharmaceuticals Incorporated, McKesson Corporation, and Alnylam Pharmaceuticals, Inc., Blueprint Medicines Corporation is one of the stocks on the radar of elite investors.
5. MaxCyte, Inc. (NASDAQ:MXCT)
Casdin Capital’s Stake Value: $66,084,000
Percentage of Casdin Capital’s 13F Portfolio: 5.58%
Number of Hedge Fund Holders: 10
MaxCyte, Inc. (NASDAQ:MXCT), a worldwide life sciences company, is involved in the research, development, and commercialization of novel cell therapies. Following MaxCyte, Inc.’s “beat and raise” Q2 report on August 14, BTIG analyst Mark Massaro increased his price target on the stock to $11 from $10 and maintained a ‘Buy’ rating on the shares.
Comprising of 13.97 million shares, Casdin Capital’s stake in MaxCyte, Inc. at the end of the second quarter was worth $66.08 million. The stock accounts for 5.58% of the fund’s total 13F portfolio. Out of the hedge funds being tracked by Insider Monkey, New York-based investment firm Casdin Capital is the leading shareholder of MaxCyte, Inc..
According to Insider Monkey’s data, 10 hedge funds were long MaxCyte, Inc. at the end of Q2 2022, compared to 12 funds in the prior quarter.
Here is what Baron Funds, an asset management firm, had to say about MaxCyte, Inc. in its Q2 2022 investor letter:
“During the quarter, we exited MaxCyte, Inc., an early-stage cell and gene therapy tools company, whose value largely depends on milestone payments and commercialized product revenues of its customers.”
4. Relay Therapeutics, Inc. (NASDAQ:RLAY)
Casdin Capital’s Stake Value: $68,149,000
Percentage of Casdin Capital’s 13F Portfolio: 5.76%
Number of Hedge Fund Holders: 17
Relay Therapeutics, Inc. (NASDAQ:RLAY) is a clinical-stage precision medicine firm. Research & development costs of Relay Therapeutics, Inc. were $60.5 million in the second quarter of 2022, up from $45.1 million in the same period the previous year. The company has five ongoing discovery projects, with three of them being cancer-related. Two more are for diseases that run in families.
Barclays analyst Peter Lawson initiated coverage on Relay Therapeutics, Inc. on September 30, assigning the stock an ‘Equal Weight’ rating and a $23 price target. Biotechnology Value Fund / BVF Inc is Relay Therapeutics, Inc.’s largest shareholder, with shares worth $73.45 million.
Casdin Capital owned 4.07 million shares of Relay Therapeutics, Inc. in the second quarter, worth $68.15 million and representing 5.76% of the fund’s total portfolio. The hedge fund elevated its position in Relay Therapeutics, Inc. by 6% in Q2 2022.
According to Insider Monkey’s data, 17 hedge funds held stakes in Relay Therapeutics, Inc. during the second quarter of 2022, collectively worth $349.36 million. This is down from 18 hedge funds in the preceding quarter with stakes worth $587.71 million in the company.
3. BioLife Solutions, Inc. (NASDAQ:BLFS)
Casdin Capital’s Stake Value: $104,490,000
Percentage of Casdin Capital’s 13F Portfolio: 8.83%
Number of Hedge Fund Holders: 10
BioLife Solutions, Inc. (NASDAQ:BLFS) develops, produces, and sells instruments for biologically preserving cells and tissues. On August 10, Max Masucci, a Cowen analyst, cut his price objective on BioLife Solutions, Inc. from $32 to $29 while maintaining an ‘Outperform’ rating for the stock. Although he expected further SMID-cap volatility, the analyst believed the firm had solid long-term growth and profitability prospects.
On October 11, CSafe and BioLife Solutions, Inc. announced a new partnership to provide a combined global service network to support CGT products with a focus on improved reliability, security, and quality. CSafe is one of the largest active and passive temperature-controlled shipping solutions providers for pharmaceuticals.
According to regulatory data for the second quarter, Casdin Capital owned 7.57 million shares of BioLife Solutions, Inc. worth $104.49 million. The fund first bought a stake in the firm in the second quarter of 2018. In total, 10 hedge funds were bullish on BioLife Solutions, Inc. in the second quarter, down from 12 a quarter ago. Casdin Capital is the most significant shareholder of the company.
2. Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY)
Casdin Capital’s Stake Value: $117,409,000
Percentage of Casdin Capital’s 13F Portfolio: 9.92%
Number of Hedge Fund Holders: 40
Alnylam Pharmaceuticals, Inc. is a bio-pharmaceutical firm specialising in the discovery, development, and commercialization of new medicines based on ribonucleic acid interference. VenBio Select Advisor held a $198.36 million stake in Alnylam Pharmaceuticals, Inc. during the second quarter consisting of 1.36 million shares, making it the top shareholder of the firm.
After Alnylam Pharmaceuticals, Inc. released additional data from the APOLLO-B trial on October 3, Jefferies analyst Maury Raycroft increased his price target on Alnylam to $232 from $218 and reiterated a ‘Buy’ rating on the shares. He reassured the investors by stating that the totality of the research demonstrated consistency of benefit across all sub-groups.
Alnylam Pharmaceuticals, Inc. is the second largest stock holding of Eli Casdin’s Casdin Capital as of the second quarter. Casdin owned 805,000 shares of Alnylam Pharmaceuticals, Inc. valued at $117.41 million, which represented 9.92% of the fund’s overall portfolio.
40 hedge funds reported bullish bets on Alnylam Pharmaceuticals, Inc. in Q2 2022, with aggregate holdings worth $775.05 million. In contrast, 38 hedge funds were bullish on the stock a quarter ago.
1. EQRx, Inc. (NASDAQ:EQRX)
Casdin Capital’s Stake Value: $185,385,000
Percentage of Casdin Capital’s 13F Portfolio: 15.67%
Number of Hedge Fund Holders: 26
EQRx, Inc. (NASDAQ:EQRX), a pharmaceutical company, develops pharmaceuticals primarily for the treatment of cancer and immune-inflammatory illnesses. A ‘Neutral’ rating was reiterated on EQRx, Inc. by JPMorgan analyst Chris Schott on August 16. The analyst also placed a $5.50 price target on the stock.
There were 26 hedge funds long EQRx, Inc. in the second quarter of 2022, with a total stake value of $355.51 million. In comparison, 38 hedge funds were bullish on the stock in the previous quarter, with a total stake value of $494.29 million.
EQRx, Inc. stands first on the list of top 10 stock picks of Eli Casdin’s Casdin Capital. According to the 13F filings for the second quarter of 2022, the hedge fund held 39.53 million shares of EQRx, Inc., amounting to more than $185.39 million and representing 15.67% of the fund’s portfolio.
You can also take a peek at Top 9 Stock Picks of Eduardo Costa’s Calixto Global Investors and Top 10 Stock Picks of Roberto Mignone’s Bridger Management.
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This article is originally published at Insider Monkey.
