In this article we will check out the progression of hedge fund sentiment towards Coherus Biosciences Inc (NASDAQ:CHRS) and determine whether it is a good investment right now. We at Insider Monkey like to examine what billionaires and hedge funds think of a company before spending days of research on it. Given their 2 and 20 payment structure, hedge funds have more incentives and resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also employ numerous Ivy League graduates and MBAs. Like everyone else, hedge funds perform miserably at times, but their consensus picks have historically outperformed the market after risk adjustments.
Coherus Biosciences Inc (NASDAQ:CHRS) shareholders have witnessed an increase in support from the world’s most elite money managers of late. CHRS was in 35 hedge funds’ portfolios at the end of the first quarter of 2020. There were 32 hedge funds in our database with CHRS holdings at the end of the previous quarter. Our calculations also showed that CHRS isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
In the eyes of most stock holders, hedge funds are viewed as worthless, old investment tools of yesteryear. While there are more than 8000 funds with their doors open at the moment, Our researchers hone in on the moguls of this club, around 850 funds. These money managers have their hands on the lion’s share of all hedge funds’ total asset base, and by shadowing their finest picks, Insider Monkey has uncovered a number of investment strategies that have historically surpassed the market. Insider Monkey’s flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
Kris Jenner of Rock Springs Capital Management
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out trades like this one. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. With all of this in mind let’s take a look at the new hedge fund action regarding Coherus Biosciences Inc (NASDAQ:CHRS).
What does smart money think about Coherus Biosciences Inc (NASDAQ:CHRS)?
At the end of the first quarter, a total of 35 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 9% from the previous quarter. By comparison, 27 hedge funds held shares or bullish call options in CHRS a year ago. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Consonance Capital Management was the largest shareholder of Coherus Biosciences Inc (NASDAQ:CHRS), with a stake worth $32.8 million reported as of the end of September. Trailing Consonance Capital Management was Rock Springs Capital Management, which amassed a stake valued at $31.6 million. Rubric Capital Management, D E Shaw, and Sio Capital were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Sio Capital allocated the biggest weight to Coherus Biosciences Inc (NASDAQ:CHRS), around 5.86% of its 13F portfolio. Rubric Capital Management is also relatively very bullish on the stock, dishing out 4.06 percent of its 13F equity portfolio to CHRS.
With a general bullishness amongst the heavyweights, some big names have jumped into Coherus Biosciences Inc (NASDAQ:CHRS) headfirst. Consonance Capital Management, managed by Mitchell Blutt, created the most valuable position in Coherus Biosciences Inc (NASDAQ:CHRS). Consonance Capital Management had $32.8 million invested in the company at the end of the quarter. Larry Robbins’s Glenview Capital also initiated a $6.9 million position during the quarter. The other funds with brand new CHRS positions are Kevin C. Tang’s Tang Capital Management, Chuck Royce’s Royce & Associates, and Aaron Cowen’s Suvretta Capital Management.
Let’s now take a look at hedge fund activity in other stocks similar to Coherus Biosciences Inc (NASDAQ:CHRS). These stocks are Dana Incorporated (NYSE:DAN), Altra Industrial Motion Corp. (NASDAQ:AIMC), Sykes Enterprises, Incorporated (NASDAQ:SYKE), and Inogen Inc (NASDAQ:INGN). All of these stocks’ market caps are closest to CHRS’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| DAN | 28 | 143927 | 1 |
| AIMC | 15 | 80915 | 0 |
| SYKE | 14 | 56085 | -4 |
| INGN | 12 | 60103 | -9 |
| Average | 17.25 | 85258 | -3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 17.25 hedge funds with bullish positions and the average amount invested in these stocks was $85 million. That figure was $217 million in CHRS’s case. Dana Incorporated (NYSE:DAN) is the most popular stock in this table. On the other hand Inogen Inc (NASDAQ:INGN) is the least popular one with only 12 bullish hedge fund positions. Compared to these stocks Coherus Biosciences Inc (NASDAQ:CHRS) is more popular among hedge funds. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 8.3% in 2020 through the end of May and still beat the market by 13.2 percentage points. Unfortunately CHRS wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on CHRS were disappointed as the stock returned 14.9% during the second quarter (through the end of May) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
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Disclosure: None. This article was originally published at Insider Monkey.
