The elite funds run by legendary investors such as Dan Loeb and David Tepper make hundreds of millions of dollars for themselves and their investors by spending enormous resources doing research on small cap stocks that big investment banks don’t follow. Because of their pay structures, they have strong incentive to do the research necessary to beat the market. That’s why we pay close attention to what they think in small cap stocks. In this article, we take a closer look at Clovis Oncology Inc (NASDAQ:CLVS) from the perspective of those elite funds.
Is Clovis Oncology Inc (NASDAQ:CLVS) a good investment right now? Investors who are in the know seem to be in a bullish mood, as the number of funds tracked by Insider Monkey long the stock advanced by 12 to 33 between July and September. At the end of this article we will also compare CLVS to other stocks including Heritage Financial Corporation (NASDAQ:HFWA), Rapid7 Inc (NASDAQ:RPD), and Lands’ End, Inc. (NASDAQ:LE) to get a better sense of its popularity.
Follow Clovis Oncology Inc. (NASDAQ:CLVS)
Follow Clovis Oncology Inc. (NASDAQ:CLVS)
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
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Keeping this in mind, we’re going to go over the fresh action surrounding Clovis Oncology Inc (NASDAQ:CLVS).
What have hedge funds been doing with Clovis Oncology Inc (NASDAQ:CLVS)?
As stated earlier, a total of 33 funds tracked by Insider Monkey were long Clovis Oncology at the end of September, a change of 57% from one quarter earlier. With hedge funds’ capital changing hands, there exists a few key hedge fund managers who were boosting their stakes meaningfully (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Palo Alto Investors, managed by William Leland Edwards, holds the biggest investment in Clovis Oncology Inc (NASDAQ:CLVS). Palo Alto Investors has a $137.1 million position in the stock, comprising 8% of its 13F portfolio. The second largest stake is held by Mitchell Blutt’s Consonance Capital Management, which disclosed a $127.3 million position; the fund has 12.3% of its 13F portfolio invested in the stock. Other professional money managers that hold long positions consist of Zach Schreiber’s Point State Capital, Jeremy Green’s Redmile Group, and Dmitry Balyasny’s Balyasny Asset Management.
As industrywide interest jumped, key hedge funds were breaking ground themselves. Cormorant Asset Management, managed by Bihua Chen, initiated the biggest position in Clovis Oncology Inc (NASDAQ:CLVS). Cormorant Asset Management had $23.4 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $22.5 million position during the quarter. The other funds with brand new CLVS positions are Paul Sinclair’s Blue Jay Capital Management, Joseph Edelman’s Perceptive Advisors, and Paul Marshall and Ian Wace’s Marshall Wace LLP.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Clovis Oncology Inc (NASDAQ:CLVS) but similarly valued. We will take a look at Heritage Financial Corporation (NASDAQ:HFWA), Rapid7 Inc (NASDAQ:RPD), Lands’ End, Inc. (NASDAQ:LE), and Vera Bradley, Inc. (NASDAQ:VRA). This group of stocks’ market values are similar to CLVS’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| HFWA | 12 | 23687 | -1 |
| RPD | 7 | 16593 | 0 |
| LE | 9 | 152042 | -1 |
| VRA | 16 | 111913 | 0 |
As you can see these stocks had an average of 11 investors with bullish positions and the average amount invested in these stocks was $76 million. That figure was $752 million in CLVS’s case. Vera Bradley, Inc. (NASDAQ:VRA) is the most popular stock in this table with 16 funds holding shares. On the other hand Rapid7 Inc (NASDAQ:RPD) is the least popular one with only seven funds reporting long holdings. Compared to these stocks Clovis Oncology Inc (NASDAQ:CLVS) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
