SAGE Therapeutics Inc (NASDAQ:SAGE)
SAGE Therapeutics Inc (NASDAQ:SAGE) was Casdin Capital’s top equity pick at the end of the first quarter, with the fund having sold a paltry 4,500 shares of the company during that period. The stock has been on a bull run since the second-half of 2016 and managed to end the first quarter up by over 40%. During those three months, the value of Casdin Capital’s holding in the company rose to $18.12 million, though the fund’s 13F portfolio’s exposure to the stock remained nearly the same, which just goes to show how well that portfolio performed during that time.
A large part of the gains that the stock saw during the first quarter came in mid-February when the company reported positive trial data for its major depressive disorder (MDD) candidate SAGE-217. A few days after announcing that data, SAGE Therapeutics Inc (NASDAQ:SAGE)’s CEO, Jeff Jonas, said that the company has received overtures for a possible buyout, which caused the stock to rally even further. However, the very next day, on February 17, SAGE released a statement saying that its CEO acknowledged industry interest in the MDD data, but that it didn’t imply that the company was in talks with any potential acquirer. Earlier this month the company reported better-than-expected first-quarter results, declaring a loss of $1.52 per share versus analysts’ expectations of a loss of $1.61 per share.
Considering that SAGE’s stock has been moving swiftly this year on news, be sure to subscribe to real-time e-mail alerts on the stock below.
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On the next page we’ll check out two other stocks favored by Casdin Capital.
Foundation Medicine Inc (NASDAQ:FMI)
Foundation Medicine Inc (NASDAQ:FMI) has been one of the best performing pharma stocks this year, producing a gain of over 100% for its shareholders. With a gain as large as that in such a short period, it’s natural for investors to take some profits off the table and that’s exactly what we believe Casdin Capital did during the first quarter, reducing its stake in the company by 12% or 66,000 shares. However, this reduction in the stake didn’t reduce the Casdin Capital’s exposure to the stock in its 13F portfolio, with it instead accounting for a larger share (9.13%) of its portfolio at the end of March than it did at the end of December (7.98%).
On March 9, short-selling focused website TheStreetSweeper posted a bearish article on Foundation Medicine Inc (NASDAQ:FMI), stating that the stock was grossly overvalued. Interestingly, nearly all the gains that Foundation’s stock has generated this year came before this article was posted. Although the stock hasn’t retraced much since the article was published, it has been range-bound for more than two months. In the article, Sonya Colberg pointed out that the company has been reporting gradual declines in its financial performance for the past four quarters (and now five if one includes its latest quarterly results that were announced after the article was posted). Moreover, it also highlighted how Foundation’s gross margins have declined to 39% from 57% in the preceding year and that the company is no match to rivals Myriad Genetics, Inc. (NASDAQ:MYGN) and NeoGenomics, Inc. (NASDAQ:NEO) when it comes to its operational performance (which could be considered a valid concern, but also as a potential opportunity for improvement).
We have one more stock to cover on the next page.
