Here is What Hedge Funds Think About Calithera Biosciences Inc (CALA)

The worries about the election and the ongoing uncertainty about the path of interest-rate increases have been keeping investors on the sidelines. Of course, most hedge funds and other asset managers have been underperforming main stock market indices since the middle of 2015. Interestingly though, smaller-cap stocks registered their best performance relative to the large-capitalization stocks since the end of the June quarter, suggesting that this may be the best time to take a cue from their stock picks. In fact, the Russell 2000 Index gained more than 15% since the beginning of the third quarter, while the Standard and Poor’s 500 benchmark returned less than 6%. This article will lay out and discuss the hedge fund and institutional investor sentiment towards Calithera Biosciences Inc (NASDAQ:CALA).

Calithera Biosciences Inc (NASDAQ:CALA) was in 6 hedge funds’ portfolios at the end of the third quarter of 2016. CALA shareholders have witnessed a decrease in hedge fund sentiment of late. There were 8 hedge funds in our database with CALA positions at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Perceptron, Inc. (NASDAQ:PRCP), Innodata Inc (NASDAQ:INOD), and InfuSystem Holdings, Inc. (NYSEAMEX:INFU) to gather more data points.

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Now, we’re going to take a look at the fresh action surrounding Calithera Biosciences Inc (NASDAQ:CALA).

How have hedgies been trading Calithera Biosciences Inc (NASDAQ:CALA)?

At Q3’s end, a total of 6 of the hedge funds tracked by Insider Monkey held long positions in this stock, a drop of 25% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in CALA over the last 5 quarters. With hedgies’ capital changing hands, there exists a select group of key hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Phill Gross and Robert Atchinson’s Adage Capital Management has the largest position in Calithera Biosciences Inc (NASDAQ:CALA), worth close to $10.2 million. On Adage Capital Management’s heels is Hal Mintz’s Sabby Capital, which holds a $1.1 million position. Some other peers that hold long positions comprise Millennium Management which is one of the 10 largest hedge funds in the world, Jim Simons’ Renaissance Technologies and D. E. Shaw’s D E Shaw. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.

Judging by the fact that Calithera Biosciences Inc (NASDAQ:CALA) has witnessed bearish sentiment from the entirety of the hedge funds we track, it’s safe to say that there were a few hedgies that slashed their entire stakes in the third quarter. Interestingly, Jean-Marie Eveillard’s First Eagle Investment Management dropped the biggest stake of the “upper crust” of funds studied by Insider Monkey, worth close to $0.8 million in stock, and Mark Lampert’s Biotechnology Value Fund / BVF Inc was right behind this move, as the fund said goodbye to about $0.5 million worth of shares.

Let’s also examine hedge fund activity in other stocks similar to Calithera Biosciences Inc (NASDAQ:CALA). We will take a look at Perceptron, Inc. (NASDAQ:PRCP), Innodata Inc (NASDAQ:INOD), InfuSystem Holdings, Inc. (NYSEAMEX:INFU), and Netlist, Inc. (NASDAQ:NLST). This group of stocks’ market values are similar to CALA’s market value.

As you can see these stocks had an average of 4 hedge funds with bullish positions and the average amount invested in these stocks was $9 million. That figure was $12 million in CALA’s case. Perceptron, Inc. (NASDAQ:PRCP) is the most popular stock in this table. On the other hand InfuSystem Holdings, Inc. (NYSEAMEX:INFU) is the least popular one with only 3 bullish hedge fund positions. Compared to these stocks Calithera Biosciences Inc (NASDAQ:CALA) 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