The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors endured a torrid quarter, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Allena Pharmaceuticals, Inc. (NASDAQ:ALNA).
Is Allena Pharmaceuticals, Inc. (NASDAQ:ALNA) a bargain? Money managers are becoming less hopeful. The number of long hedge fund bets dropped by 1 lately. Our calculations also showed that ALNA isn’t among the 30 most popular stocks among hedge funds. ALNA was in 5 hedge funds’ portfolios at the end of the third quarter of 2018. There were 6 hedge funds in our database with ALNA holdings at the end of the previous quarter.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s flagship best performing hedge funds strategy returned 6.3% year to date (through December 3rd) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 18 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We’re going to review the key hedge fund action encompassing Allena Pharmaceuticals, Inc. (NASDAQ:ALNA).
How are hedge funds trading Allena Pharmaceuticals, Inc. (NASDAQ:ALNA)?
At the end of the third quarter, a total of 5 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -17% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in ALNA over the last 13 quarters. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Frazier Healthcare Partners, managed by Alan Frazier, holds the largest position in Allena Pharmaceuticals, Inc. (NASDAQ:ALNA). Frazier Healthcare Partners has a $35.8 million position in the stock, comprising 6.5% of its 13F portfolio. On Frazier Healthcare Partners’s heels is Partner Fund Management, managed by Christopher James, which holds a $19 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Remaining hedge funds and institutional investors that are bullish encompass Phill Gross and Robert Atchinson’s Adage Capital Management, Joseph Edelman’s Perceptive Advisors and Ken Griffin’s Citadel Investment Group.
Because Allena Pharmaceuticals, Inc. (NASDAQ:ALNA) has faced a decline in interest from the smart money, it’s safe to say that there was a specific group of hedgies that decided to sell off their full holdings last quarter. Intriguingly, Israel Englander’s Millennium Management dropped the largest position of the “upper crust” of funds watched by Insider Monkey, valued at an estimated $2.9 million in stock, and Gavin Saitowitz and Cisco J. del Valle’s Springbok Capital was right behind this move, as the fund said goodbye to about $0 million worth. These transactions are interesting, as aggregate hedge fund interest was cut by 1 funds last quarter.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Allena Pharmaceuticals, Inc. (NASDAQ:ALNA) but similarly valued. We will take a look at CSI Compressco LP (NASDAQ:CCLP), Rosehill Resources Inc. (NASDAQ:ROSE), Hornbeck Offshore Services, Inc. (NYSE:HOS), and Universal Stainless & Alloy Products (NASDAQ:USAP). This group of stocks’ market valuations are similar to ALNA’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CCLP | 3 | 1734 | 1 |
| ROSE | 14 | 21634 | 11 |
| HOS | 18 | 91870 | 0 |
| USAP | 7 | 23380 | 0 |
| Average | 10.5 | 34655 | 3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 10.5 hedge funds with bullish positions and the average amount invested in these stocks was $35 million. That figure was $61 million in ALNA’s case. Hornbeck Offshore Services, Inc. (NYSE:HOS) is the most popular stock in this table. On the other hand CSI Compressco LP (NASDAQ:CCLP) is the least popular one with only 3 bullish hedge fund positions. Allena Pharmaceuticals, Inc. (NASDAQ:ALNA) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard HOS might be a better candidate to consider a long position.
Disclosure: None. This article was originally published at Insider Monkey.