Hedge Funds Are Selling Kamada Ltd (KMDA)

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 nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Kamada Ltd (NASDAQ:KMDA), so let’s take a closer look at the sentiment that surrounds it in the current quarter.

Kamada Ltd (NASDAQ:KMDA) shareholders have witnessed a decrease in support from the world’s most elite money managers recently. Kamada Ltd (NASDAQ:KMDA) was in 4 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 6. There were 5 hedge funds in our database with KMDA positions at the end of the fourth quarter. Our calculations also showed that KMDA isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).

If you’d ask most shareholders, hedge funds are perceived as worthless, outdated financial vehicles of the past. While there are more than 8000 funds with their doors open today, We hone in on the top tier of this club, approximately 850 funds. Most estimates calculate that this group of people shepherd bulk of the smart money’s total capital, and by watching their top equity investments, Insider Monkey has discovered many investment strategies that have historically outperformed Mr. Market. Insider Monkey’s flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points a year since its inception in March 2017. Also, our monthly newsletter’s portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .

Cathie Wood of ARK Investment Management

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $28 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Now we’re going to analyze the new hedge fund action regarding Kamada Ltd (NASDAQ:KMDA).

Do Hedge Funds Think KMDA Is A Good Stock To Buy Now?

At the end of March, a total of 4 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -20% from the fourth quarter of 2020. Below, you can check out the change in hedge fund sentiment towards KMDA over the last 23 quarters. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were increasing their holdings meaningfully (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Renaissance Technologies has the number one position in Kamada Ltd (NASDAQ:KMDA), worth close to $7.5 million, corresponding to less than 0.1%% of its total 13F portfolio. On Renaissance Technologies’s heels is ARK Investment Management, managed by Catherine D. Wood, which holds a $5.3 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other professional money managers that are bullish encompass Roy Vermus and Shlomi Bracha’s Noked Capital, Ken Griffin’s Citadel Investment Group and . In terms of the portfolio weights assigned to each position Noked Capital allocated the biggest weight to Kamada Ltd (NASDAQ:KMDA), around 0.03% of its 13F portfolio. ARK Investment Management is also relatively very bullish on the stock, designating 0.01 percent of its 13F equity portfolio to KMDA.

Since Kamada Ltd (NASDAQ:KMDA) has experienced bearish sentiment from the smart money, it’s safe to say that there lies a certain “tier” of hedgies who were dropping their full holdings last quarter. Intriguingly, Paul Marshall and Ian Wace’s Marshall Wace LLP cut the largest investment of the “upper crust” of funds followed by Insider Monkey, comprising close to $0.4 million in stock, and Israel Englander’s Millennium Management was right behind this move, as the fund cut about $0.4 million worth. These moves are intriguing to say the least, 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 Kamada Ltd (NASDAQ:KMDA) but similarly valued. We will take a look at EZCORP Inc (NASDAQ:EZPW), NextCure, Inc. (NASDAQ:NXTC), Invacare Corporation (NYSE:IVC), Biglari Holdings Inc (NYSE:BH), WAVE Life Sciences Ltd. (NASDAQ:WVE), Diana Shipping Inc. (NYSE:DSX), and Provident Bancorp, Inc. (NASDAQ:PVBC). This group of stocks’ market values match KMDA’s market value.

View table here if you experience formatting issues.

As you can see these stocks had an average of 12.6 hedge funds with bullish positions and the average amount invested in these stocks was $54 million. That figure was $13 million in KMDA’s case. WAVE Life Sciences Ltd. (NASDAQ:WVE) is the most popular stock in this table. On the other hand Provident Bancorp, Inc. (NASDAQ:PVBC) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks Kamada Ltd (NASDAQ:KMDA) is even less popular than PVBC. Our overall hedge fund sentiment score for KMDA is 24. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Hedge funds dodged a bullet by taking a bearish stance towards KMDA. Our calculations showed that the top 10 most popular hedge fund stocks returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 17.2% in 2021 through June 11th but managed to beat the market again by 3.3 percentage points. Unfortunately KMDA wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was very bearish); KMDA investors were disappointed as the stock returned -4.7% since the end of the first quarter (through 6/11) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market since 2019.

Disclosure: None. This article was originally published at Insider Monkey.