Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow over 700 of the best-performing investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Intersect ENT Inc (NASDAQ:XENT), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Is Intersect ENT Inc (NASDAQ:XENT) worth your attention right now? Investors who are in the know are betting on the stock. The number of bullish hedge fund bets moved up by 1 in recent months. Our calculations also showed that XENT isn’t among the 30 most popular stocks among hedge funds.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 18 percentage points since May 2014 through December 3, 2018 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Let’s analyze the new hedge fund action regarding Intersect ENT Inc (NASDAQ:XENT).
How have hedgies been trading Intersect ENT Inc (NASDAQ:XENT)?
Heading into the fourth quarter of 2018, a total of 22 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 5% from the previous quarter. On the other hand, there were a total of 21 hedge funds with a bullish position in XENT at the beginning of this year. With hedge funds’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, James E. Flynn’s Deerfield Management has the biggest position in Intersect ENT Inc (NASDAQ:XENT), worth close to $61.8 million, corresponding to 2.2% of its total 13F portfolio. On Deerfield Management’s heels is Arthur B Cohen and Joseph Healey of Healthcor Management LP, with a $56.1 million position; the fund has 1.9% of its 13F portfolio invested in the stock. Remaining professional money managers that hold long positions contain Israel Englander’s Millennium Management, Kris Jenner, Gordon Bussard, Graham McPhail’s Rock Springs Capital Management and Eric Bannasch’s Cadian Capital.
As one would reasonably expect, key hedge funds have jumped into Intersect ENT Inc (NASDAQ:XENT) headfirst. Point72 Asset Management, managed by Steve Cohen, initiated the biggest position in Intersect ENT Inc (NASDAQ:XENT). Point72 Asset Management had $9.2 million invested in the company at the end of the quarter. Kevin Kotler’s Broadfin Capital also made a $6.7 million investment in the stock during the quarter. The following funds were also among the new XENT investors: Phill Gross and Robert Atchinson’s Adage Capital Management, Paul Marshall and Ian Wace’s Marshall Wace LLP, and Efrem Kamen’s Pura Vida Investments.
Let’s also examine hedge fund activity in other stocks similar to Intersect ENT Inc (NASDAQ:XENT). We will take a look at Resolute Energy Corp (NYSE:REN), iShares India 50 ETF (NASDAQ:INDY), Tahoe Resources Inc (NYSE:TAHO), and Innophos Holdings, Inc. (NASDAQ:IPHS). This group of stocks’ market values are similar to XENT’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| REN | 10 | 209903 | -4 |
| INDY | 2 | 11294 | 2 |
| TAHO | 13 | 32797 | -2 |
| IPHS | 10 | 49388 | -1 |
| Average | 8.75 | 75846 | -1.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 8.75 hedge funds with bullish positions and the average amount invested in these stocks was $76 million. That figure was $214 million in XENT’s case. Tahoe Resources Inc (NYSE:TAHO) is the most popular stock in this table. On the other hand 0 is the least popular one with only 2 bullish hedge fund positions. Compared to these stocks Intersect ENT Inc (NASDAQ:XENT) 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.
Disclosure: None. This article was originally published at Insider Monkey.
