While the market driven by short-term sentiment influenced by the accomodative interest rate environment in the US, increasing oil prices and deteriorating expectations towards the resolution of the trade war with China, many smart money investors kept their cautious approach regarding the current bull run in the second quarter and hedging or reducing many of their long positions. Some fund managers like this one are betting on Dow hitting 40,000 to generate strong returns. However, as we know, big investors usually buy stocks with strong fundamentals that can deliver gains both in bull and bear markets, which is why we believe we can profit from imitating them. In this article, we are going to take a look at the smart money sentiment surrounding Evolus, Inc. (NASDAQ:EOLS).
Evolus, Inc. (NASDAQ:EOLS) has seen an increase in hedge fund interest lately. EOLS was in 12 hedge funds’ portfolios at the end of June. There were 6 hedge funds in our database with EOLS positions at the end of the previous quarter. Our calculations also showed that EOLS isn’t among the 30 most popular stocks among hedge funds (see the video below).
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
Today there are many metrics investors can use to appraise stocks. Two of the most innovative metrics are hedge fund and insider trading signals. We have shown that, historically, those who follow the top picks of the best money managers can outclass the broader indices by a solid margin (see the details here).
Unlike former hedge manager, Dr. Steve Sjuggerud, who is convinced Dow will soar past 40000, our long-short investment strategy doesn’t rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. Let’s view the latest hedge fund action encompassing Evolus, Inc. (NASDAQ:EOLS).
Hedge fund activity in Evolus, Inc. (NASDAQ:EOLS)
At Q2’s end, a total of 12 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 100% from the first quarter of 2019. On the other hand, there were a total of 0 hedge funds with a bullish position in EOLS a year ago. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Point72 Asset Management was the largest shareholder of Evolus, Inc. (NASDAQ:EOLS), with a stake worth $4.2 million reported as of the end of March. Trailing Point72 Asset Management was Millennium Management, which amassed a stake valued at $2.3 million. Royce & Associates, MFN Partners, and Prosight Capital were also very fond of the stock, giving the stock large weights in their portfolios.
With a general bullishness amongst the heavyweights, some big names were leading the bulls’ herd. Point72 Asset Management, managed by Steve Cohen, created the biggest position in Evolus, Inc. (NASDAQ:EOLS). Point72 Asset Management had $4.2 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also initiated a $2.3 million position during the quarter. The following funds were also among the new EOLS investors: Farhad Nanji and Michael DeMichele’s MFN Partners, Lawrence Hawkins’s Prosight Capital, and Simon Sadler’s Segantii Capital.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Evolus, Inc. (NASDAQ:EOLS) but similarly valued. We will take a look at PDL BioPharma Inc. (NASDAQ:PDLI), Consolidated Communications Holdings Inc (NASDAQ:CNSL), Agenus Inc (NASDAQ:AGEN), and Telenav Inc (NASDAQ:TNAV). This group of stocks’ market caps are closest to EOLS’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PDLI | 13 | 66848 | -5 |
| CNSL | 14 | 8843 | 3 |
| AGEN | 6 | 14030 | -1 |
| TNAV | 12 | 90686 | 2 |
| Average | 11.25 | 45102 | -0.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 11.25 hedge funds with bullish positions and the average amount invested in these stocks was $45 million. That figure was $15 million in EOLS’s case. Consolidated Communications Holdings Inc (NASDAQ:CNSL) is the most popular stock in this table. On the other hand Agenus Inc (NASDAQ:AGEN) is the least popular one with only 6 bullish hedge fund positions. Evolus, Inc. (NASDAQ:EOLS) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 20 most popular stocks among hedge funds returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Hedge funds were also right about betting on EOLS as the stock returned 6.8% during the third quarter and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published at Insider Monkey.
