We can judge whether CEL-SCI Corporation (NYSEAMEX:CVM) is a good investment right now by following the lead of some of the best investors in the world and piggybacking their ideas. There’s no better way to get these firms’ immense resources and analytical capabilities working for us than to follow their lead into their best ideas. While not all of these picks will be winners, research shows that these picks historically outperformed the market when we factor in known risk factors.
Is CEL-SCI Corporation (NYSEAMEX:CVM) a buy here? Prominent investors are taking a pessimistic view. The number of long hedge fund bets stayed the same which is a slightly negative development in our experience. At the end of this article we will also compare CVM to other stocks, including AdCare Health Systems, Inc. (NYSEMKT:ADK), Gulf Coast Ultra Deep Royalty Trust (OTCMKTS:GULTU), and Ballantyne Strong Inc (NYSEAMEX:BTN) to get a better sense of its popularity.
Follow Cel Sci Corp (NYSEMKT:CVM)
Follow Cel Sci Corp (NYSEMKT:CVM)
In the financial world, there are a lot of gauges investors use to value publicly traded companies. Two of the most underrated gauges are hedge fund and insider trading signals. Our researchers have shown that, historically, those who follow the best picks of the elite hedge fund managers can outpace the S&P 500 by a very impressive amount (see the details here).
Now, we’re going to view the latest action encompassing CEL-SCI Corporation (NYSEAMEX:CVM).
What have hedge funds been doing with CEL-SCI Corporation (NYSEAMEX:CVM)?
Heading into Q4, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the second quarter. With the smart money’s capital changing hands, there exist a few notable hedge fund managers who were increasing their holdings substantially (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Peter S. Park’s Park West Asset Management has the biggest position in CEL-SCI Corporation (NYSEAMEX:CVM), worth close to $0.5 million, comprising less than 0.1%% of its total 13F portfolio. Sitting at the No. 2 spot is Nathan Fischel of DAFNA Capital Management, with a $100,000 position; the fund has 0.1% of its 13F portfolio invested in the stock. Other professional money managers that are bullish include Israel Englander’s Millennium Management, and Bart Baum’s Ionic Capital Management.
We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Sabby Capital. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case here because only one of the 700+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was “Park West Asset Management).
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as CEL-SCI Corporation (:CVM) but similarly valued. We will take a look at AdCare Health Systems, Inc. (NYSEMKT:ADK), Gulf Coast Ultra Deep Royalty Trust (OTCMKTS:GULTU), Ballantyne Strong Inc (NYSEAMEX:BTN), and OncoGenex Pharmaceuticals Inc (NASDAQ:OGXI). This group of stocks’ market values are similar to CVM’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ADK | 5 | 3606 | 1 |
| GULTU | 14 | 21142 | -4 |
| BTN | 4 | 16596 | 0 |
| OGXI | 5 | 2715 | -2 |
As you can see these stocks had an average of 7 hedge funds with bullish positions and the average amount invested in these stocks was $11 million. Gulf Coast Ultra Deep Royalty Trust (OTCMKTS:GULTU) is the most popular stock in this table, while Ballantyne Strong Inc (NYSEAMEX:BTN) is the least popular one. Compared to these stocks CEL-SCI Corporation (NYSEAMEX:CVM) is even less popular than BTN. Moreover, hedge funds held just $1.0 million worth of CVM’s shares at the end of September. Therefore, it seems that smart money is not very fond of CVM, which does not necessarily mean that the stock is overvalued and a further analysis might still suggest that the stock is worth buying. However, we think it may be better to look into stocks that hedge funds are collectively most bullish on.