We at Insider Monkey have gone over 738 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds’ and investors’ portfolio positions as of March 31st. In this article, we look at what those funds think of Heska Corp (NASDAQ:HSKA) based on that data.
Heska Corp (NASDAQ:HSKA) shareholders have witnessed a decrease in enthusiasm from smart money in recent months. Our calculations also showed that HSKA isn’t among the 30 most popular stocks among hedge funds.
To most market participants, hedge funds are viewed as underperforming, outdated financial vehicles of years past. While there are greater than 8000 funds with their doors open at the moment, Our experts choose to focus on the elite of this group, approximately 750 funds. These hedge fund managers administer the lion’s share of the hedge fund industry’s total asset base, and by keeping an eye on their best picks, Insider Monkey has uncovered various investment strategies that have historically outpaced the market. Insider Monkey’s flagship hedge fund strategy outrun the S&P 500 index by around 5 percentage points annually since its inception in May 2014 through June 18th. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 28.2% since February 2017 (through June 18th) even though the market was up nearly 30% during the same period. We just shared a list of 5 short targets in our latest quarterly update and they are already down an average of 8.2% in a month whereas our long picks outperformed the market by 2.5 percentage points in this volatile 5 week period (our long picks also beat the market by 15 percentage points so far this year).
We’re going to take a look at the latest hedge fund action regarding Heska Corp (NASDAQ:HSKA).
Hedge fund activity in Heska Corp (NASDAQ:HSKA)
At the end of the first quarter, a total of 11 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -8% from the fourth quarter of 2018. The graph below displays the number of hedge funds with bullish position in HSKA over the last 15 quarters. With the smart money’s sentiment swirling, there exists a select group of key hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).
More specifically, Redmile Group was the largest shareholder of Heska Corp (NASDAQ:HSKA), with a stake worth $19.2 million reported as of the end of March. Trailing Redmile Group was Millennium Management, which amassed a stake valued at $11 million. GAMCO Investors, Citadel Investment Group, and AlphaOne Capital Partners were also very fond of the stock, giving the stock large weights in their portfolios.
Since Heska Corp (NASDAQ:HSKA) has faced bearish sentiment from the smart money, we can see that there were a few hedgies who were dropping their full holdings heading into Q3. Interestingly, Peter S. Park’s Park West Asset Management cut the largest investment of the 700 funds tracked by Insider Monkey, comprising close to $9.1 million in stock, and Paul Marshall and Ian Wace’s Marshall Wace LLP was right behind this move, as the fund sold off about $2.4 million worth. These bearish behaviors are important to note, as total hedge fund interest fell by 1 funds heading into Q3.
Let’s check out hedge fund activity in other stocks similar to Heska Corp (NASDAQ:HSKA). We will take a look at Hanmi Financial Corp (NASDAQ:HAFC), Construction Partners, Inc. (NASDAQ:ROAD), Osiris Corporation (OTC:OSIR), and Apollo Medical Holdings, Inc. (NASDAQ:AMEH). This group of stocks’ market valuations match HSKA’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| HAFC | 12 | 37575 | 2 |
| ROAD | 8 | 13006 | 0 |
| OSIR | 13 | 55531 | 5 |
| AMEH | 3 | 851 | 0 |
| Average | 9 | 26741 | 1.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 9 hedge funds with bullish positions and the average amount invested in these stocks was $27 million. That figure was $38 million in HSKA’s case. Osiris Corporation (OTC:OSIR) is the most popular stock in this table. On the other hand Apollo Medical Holdings, Inc. (NASDAQ:AMEH) is the least popular one with only 3 bullish hedge fund positions. Heska Corp (NASDAQ:HSKA) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 20 most popular stocks among hedge funds returned 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. Unfortunately HSKA wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on HSKA were disappointed as the stock returned -2.5% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published at Insider Monkey.
