Reputable billionaire investors such as Nelson Peltz and David Tepper generate exorbitant profits for their wealthy accredited investors (a minimum of $1 million in investable assets would be required to invest in a hedge fund and most successful hedge funds won’t accept your savings unless you commit at least $5 million) by pinpointing winning small-cap stocks. There is little or no publicly-available information at all on some of these small companies, which makes it hard for an individual investor to pin down a winner within the small-cap space. However, hedge funds and other big asset managers can do the due diligence and analysis for you instead, thanks to their highly-skilled research teams and vast resources to conduct an appropriate evaluation process. Looking for potential winners within the small-cap galaxy of stocks? We believe following the smart money is a good starting point.
Coherus Biosciences Inc (NASDAQ:CHRS) was in 19 hedge funds’ portfolios at the end of the third quarter of 2016. CHRS has seen an increase in hedge fund sentiment in recent months. There were 14 hedge funds in our database with CHRS holdings at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Pacific Premier Bancorp, Inc. (NASDAQ:PPBI), Lydall, Inc. (NYSE:LDL), and Veeco Instruments Inc. (NASDAQ:VECO) to gather more data points.
Follow Coherus Biosciences Inc. (NASDAQ:CHRS)
Follow Coherus Biosciences Inc. (NASDAQ:CHRS)
We follow over 700 hedge funds and other institutional investors and by analyzing their quarterly 13F filings, we identify stocks that they are collectively bullish on and develop investment strategies based on this data. One strategy that outperformed the market over the last year, involves selecting the 100 best-performing funds and identifying the 30 mid-cap stocks that they are collectively most bullish on. Over the past year, this strategy generated returns of 18%, topping the 8% gain registered by S&P 500 ETFs.
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With all of this in mind, we’re going to analyze the recent action regarding Coherus Biosciences Inc (NASDAQ:CHRS).
Hedge fund activity in Coherus Biosciences Inc (NASDAQ:CHRS)
At the end of the third quarter, a total of 19 of the hedge funds tracked by Insider Monkey held long positions in this stock, a boost of 36% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Israel Englander’s Millennium Management has the largest position in Coherus Biosciences Inc (NASDAQ:CHRS), worth close to $27 million, comprising less than 0.1% of its total 13F portfolio. The second most bullish fund manager is OrbiMed Advisors, led by Samuel Isaly, which holds a $18 million position; 0.2% of its 13F portfolio is allocated to the stock. Some other members of the smart money with similar optimism include Bihua Chen’s Cormorant Asset Management, Kris Jenner, Gordon Bussard, Graham McPhail’s Rock Springs Capital Management and James Dondero’s Highland Capital Management.
With a general bullishness amongst the heavyweights, key money managers were breaking ground themselves. OrbiMed Advisors, managed by Samuel Isaly, created the most valuable position in Coherus Biosciences Inc (NASDAQ:CHRS). The fund reportedly had $18 million invested in the company at the end of the quarter. Roberto Mignone’s Bridger Management also initiated a $9.6 million position during the quarter. The other funds with new positions in the stock are D. E. Shaw’s D E Shaw, Michael Castor’s Sio Capital, and David Costen Haley’s HBK Investments.
Let’s also examine hedge fund activity in other stocks similar to Coherus Biosciences Inc (NASDAQ:CHRS). We will take a look at Pacific Premier Bancorp, Inc. (NASDAQ:PPBI), Lydall, Inc. (NYSE:LDL), Veeco Instruments Inc. (NASDAQ:VECO), and VASCO Data Security International, Inc. (NASDAQ:VDSI). This group of stocks’ market caps resemble CHRS’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PPBI | 10 | 28960 | -3 |
| LDL | 12 | 67062 | -1 |
| VECO | 11 | 133447 | 1 |
| VDSI | 16 | 63008 | 2 |
As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $73 million. That figure was $121 million in CHRS’s case. VASCO Data Security International, Inc. (NASDAQ:VDSI) is the most popular stock in this table. On the other hand Pacific Premier Bancorp, Inc. (NASDAQ:PPBI) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks Coherus Biosciences Inc (NASDAQ:CHRS) 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.
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Disclosure: none.
