The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. Insider Monkey finished processing 821 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of March 31st, 2020. What do these smart investors think about Catabasis Pharmaceuticals Inc (NASDAQ:CATB)?
Is Catabasis Pharmaceuticals Inc (NASDAQ:CATB) an attractive stock to buy now? Hedge funds are becoming hopeful. The number of long hedge fund positions went up by 1 in recent months. Our calculations also showed that CATB 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.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 58 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 36% through May 18th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Samuel Isaly of OrbiMed Advisors
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 stocks recommended/scorned by legendary Bill Miller. 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. Now we’re going to take a peek at the key hedge fund action surrounding Catabasis Pharmaceuticals Inc (NASDAQ:CATB).
What does smart money think about Catabasis Pharmaceuticals Inc (NASDAQ:CATB)?
At the end of the first quarter, a total of 7 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 17% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards CATB over the last 18 quarters. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Catabasis Pharmaceuticals Inc (NASDAQ:CATB) was held by Alyeska Investment Group, which reported holding $4.7 million worth of stock at the end of September. It was followed by Samsara BioCapital with a $1.2 million position. Other investors bullish on the company included Parkman Healthcare Partners, Renaissance Technologies, and Winton Capital Management. In terms of the portfolio weights assigned to each position Samsara BioCapital allocated the biggest weight to Catabasis Pharmaceuticals Inc (NASDAQ:CATB), around 0.72% of its 13F portfolio. Parkman Healthcare Partners is also relatively very bullish on the stock, earmarking 0.3 percent of its 13F equity portfolio to CATB.
With a general bullishness amongst the heavyweights, some big names were leading the bulls’ herd. Parkman Healthcare Partners, managed by Greg Martinez, assembled the most outsized position in Catabasis Pharmaceuticals Inc (NASDAQ:CATB). Parkman Healthcare Partners had $0.6 million invested in the company at the end of the quarter. Samuel Isaly’s OrbiMed Advisors also initiated a $0.2 million position during the quarter. The only other fund with a brand new CATB position is Efrem Kamen’s Pura Vida Investments.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Catabasis Pharmaceuticals Inc (NASDAQ:CATB) but similarly valued. These stocks are Research Solutions, Inc (NASDAQ:RSSS), NN, Inc. (NASDAQ:NNBR), Aquestive Therapeutics, Inc. (NASDAQ:AQST), and Cyclerion Therapeutics, Inc. (NASDAQ:CYCN). This group of stocks’ market caps resemble CATB’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| RSSS | 1 | 22697 | 1 |
| NNBR | 7 | 9567 | -2 |
| AQST | 9 | 8380 | -6 |
| CYCN | 11 | 20052 | 0 |
| Average | 7 | 15174 | -1.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 7 hedge funds with bullish positions and the average amount invested in these stocks was $15 million. That figure was $3 million in CATB’s case. Cyclerion Therapeutics, Inc. (NASDAQ:CYCN) is the most popular stock in this table. On the other hand Research Solutions, Inc (NASDAQ:RSSS) is the least popular one with only 1 bullish hedge fund positions. Catabasis Pharmaceuticals Inc (NASDAQ:CATB) is not the least popular stock in this group but hedge fund interest is still below average. 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 13.9% in 2020 through June 10th and still beat the market by 14.2 percentage points. A small number of hedge funds were also right about betting on CATB as the stock returned 65.5% during the second quarter and outperformed the market by an even larger margin.
Follow Astria Therapeutics Inc. (NASDAQ:ATXS)
Follow Astria Therapeutics Inc. (NASDAQ:ATXS)
Disclosure: None. This article was originally published at Insider Monkey.
